Department of Finance, Government of Kerala

The Department of Finance manages the state finances and economy of Kerala. The Department takes decisions on matters related to the financial status of the state. The department is headed by a senior minister who has cabinet ranking as per Indian Cabinet Protocol Laws. The department is assisted by Finance Secretary and 17 additional secretaries. The finance department manages and regulates the state economy and finances through financial legislation, taxation, capital markets, financial institutions, center and state finances, and the state budget. The main duties and responsibilities of the Finance Department are outlined in Articles 202 to 206 of the Constitution of India. Therefore, the Finance Department carries out important constitutional responsibilities in the state administration system.

Formation of Finance Department

The British Resident and Diwan of Travancore, John Munro and the Travancore ruler, Rani Lakshmi Bai, as part of their reforms in Kerala's administration between 1811 and 1814, had framed some of the major secretariat (known in the name of Huzur Cutchery, Public Office or Puthen Kacheri at that time) departments like Finance, Revenue, Police, etc. A Peshkar (Secretary of the State) was appointed to manage state finances. The Secretariat officially started functioning on 23 August 1869. Soon the Finance Department was modernized in 1871 as part of the administrative reform and development plans in Travancore. This department, formed in 1871, continues to play a major role in the state administration system. The Secretariat came to be known as 'Government Secretariat' from 25th August 1949 onwards. Unlike other Indian states, Revenue functions of Finance department is separated from the department and maintained as an independent department with seperate minister heading the department. This is because the princely states of Kochi and Travancore considered the state revenues as an independent department during monarchical days. Prior to forming finance department, it was known as Pandara (now Revenue department) managing state finances. Most of the Pandara lands (Royal government lands), is given as lease to the feudal lords, industrialists, temples, planters and religious congregations for carrying out the economic activities in return for fixed revenue.

Functions of Department of Finance

The department controls the major functions like Stores & Purchase, Financial Enterprises, Agricultural Income Tax, Commercial Taxes, Treasuries, Lotteries, Local Fund Audit, State Insurance, Stamps & Stamp Duties etc. The Secretariat has three main sections - Administrative Secretariat, Finance Secretariat and Legal Secretariat. The Finance Department functions in the Finance Secretariat. The state's budget is managed by the Finance Department. The Treasury Department functions under the control of the Finance Department. 

Public Expenditure Review Committees

Kerala Government appoints committees called 'Public Expenditure Review Committee' for the purpose of preparation of Review reports every year. The Committee submites the report on december every year on the financial performance of the State during the previous year. The Public Expenditure Review Committees are formed under Kerala Fiscal Responsibility Act of 2003.

Line Departments

■ National Savings Department

■ Treasuries Department

■ Kerala State Audit Department

■ Kerala State Insurance Department

Agencies/Commissions

■ Kerala Financial Corporation

■ Central and State Finance Commissions

Special wings

■ Finance (Inspection – Non-Technical) Wing

■ Finance (Inspection – Technical) Wing

■ Finance (IT Division) Department