The Kerala government is asking the NGT to exempt it from creating a dedicated account for liquid waste management

The Kerala government has asked the National Green Tribunal (NGT) to implement various environmental restoration, sewage and solid waste management projects through its existing decentralized plan for local self-government institutions instead of creating a separate, purpose-delimited account.

The New Delhi High Court had earlier asked authorities to set up a single centralized escrow account at the state level to deposit funds designated as “environmental compensation” for mismanagement of waste. He objected to the inclusion of funds received under various schemes, including the Atal Mission for Rejuvenation and Urban Transformation (AMRUT), in the earmarked account.

A report submitted to the court by the Ministry of Local Government (LSGD) states that “the creation of an exclusive purpose-protected account to deposit hundreds of millions of crowns for environmental compensation is administratively daunting and contrary to the model of democratic decentralization practiced in the state.”

“Administrative Obstacles”

In Kerala, around 1,200 Local Government Institutions (LSGIs) handle waste generation, collection and treatment. Centralizing these funds in a single escrow account creates administrative hurdles, delays disbursements at the field level and stifles the operational capabilities of local authorities implementing environmental projects on the ground, it said.

LSGD officials said Keralam currently transfers nearly 28.5% of its state expenditure directly to LSGI as plan funds. Funds earmarked for environmental protection are transferred directly to local authority accounts to ensure immediate operational autonomy for waste treatment and infrastructure maintenance, they said.

Local bodies formulated individual environmental and waste management schemes directly on the electronic plan monitoring and project management portal ‘Sulekha’, which was designed specifically for plan formulation, vetting and approval, they said.

The government asked the tribunal to accept the total amount of ₹4,068.2 crore currently earmarked under various earmarked budgetary allocations by the state and other schemes for liquid waste management as meeting the purpose fencing requirement recommended by the High Bench.

Officials of the Kerala State Pollution Control Board said the government had assured the tribunal that the funds earmarked for liquid waste management would remain solely for addressing the deficiencies and building the necessary infrastructure, including sewage treatment plants, to ensure waste was managed as per norms.

Published – October 5, 2026 12:52 PM IST