Department of Finance (Kerala) - History

History

The British Resident and Dewan, Col. John Munro, and Her Highness Rani Lakshmi Bai, as part of their reform and modernization of Kerala's administration between 1811 and 1814, had framed some of the major departments of the Secretariat like Finance, Revenue, Police, etc. A Peshkar (Secretary of the State) was appointed to manage state finances.

In the course of legislative developments in 1865, the foundation stone was laid for the Secretariat building by His Highness Ayilyam Thirunal Majaraja. The Secretariat began to function from 23 August 1869. Earlier, the Secretariat was known as Huzur Cutchery, Public Office or Puthen Kacheri. The Finance Department, ever since, has played a major role in governance. (The Secretariat later came to be known as ‘Government Secretariat’, from 25 August 1949, by virtue of Circular no. M3-5412/49/CS).

Unlike other Indian states, Revenue functions of Finance department is separated from the department and maintained as an independent department with another senior cabinet ranking minister, heading the portfolio. This was primarily because of Kerala’s long history in keep state revenues as an independent department during monarchical days. During Monarchical days in Kochi and Travancore Kingdoms, most of the land are owned by Royal governments, which has been leased to feudal lords, planters, industrialists, temple bodies and religious congregations for carrying out economic activities in return for fixed revenue. Prior to forming finance department, it was Pandara (also pronounced as Bhandra Dept- Malayalam name of Revenue dept) managing state finances. When separate finance department was formed to formulate state financial policies, expenditure controls, investment opportunities and controlling fiscal deficits, the tax collection and revenue remained as a separate body itself.