Centre Notifies Rules for Environmental Protection Fund Usage from Penalties
The Ministry of Environment, Forest and Climate Change has officially notified new rules under the Environment Protection Act of 1986. These rules establish clear procedures for using the Environmental Protection Fund. This fund collects penalties imposed for violations under key environmental laws.
What the Fund Covers
The Environmental Protection Fund Rules, 2026, specify a wide range of activities eligible for funding. These include:
- Installation, operation, and maintenance of environmental monitoring equipment like air quality monitors.
- Capacity building through laboratory setups.
- Remediation of environmental damage, including work at existing contaminated sites.
- Conducting studies as directed by various courts and tribunals.
As many as eleven such activities have been listed in the rules. The fund can also cover administrative expenses. This includes salaries and emoluments for contractual staff and consultants in the project management unit administering the fund.
Financial Controls and Authority
Administrative expenses must not exceed five percent of the fund's available amount in a financial year. This applies to both the central and state governments. The Union Minister for Environment, Forest and Climate Change is designated as the competent authority.
This minister may approve the use of funds for any other purpose considered necessary for environmental protection and betterment. This provides flexibility for unforeseen needs.
Fund Management and Distribution
Penalty money collected will first be credited to the Consolidated Fund of India. It will then be transferred to the Public Account of India, as per the rules published on January 17.
The rules state that the administrator must remit 75 percent of collected penalties to the Consolidated Fund of the concerned state or union territory. The Centre retains the remaining 25 percent.
Background and Oversight
The creation of this environmental protection fund was provisioned in the Jan Vishwas Act of 2023. This act decriminalized several pollution-linked offences under existing laws. Penalties for contravention now range from a minimum of Rs 10,000 to Rs 15 lakh.
To ensure transparency, the accounts of the Environmental Protection Fund will be audited by the Comptroller and Auditor General of India. The audit reports will be tabled in Parliament and state legislatures for review.
These new rules provide a structured framework for utilizing environmental penalty funds. They aim to direct resources toward tangible improvements in monitoring, cleanup, and legal compliance.
