Committee to Design Middle Office Modalities

A committee comprising senior officials from the finance ministry and central bank was set up in September 2010 to work out the modalities to make the middle office operational and decide on its responsibilities. The government decided to form the middle office which would be a pre-cursor to an independent Debt Management Office (DMO),that will manage the Centre’s borrowing programme. The committee is expected to finalise on issues related to manpower, the IT framework and key functions that the middle office will undertake. The committee would also help in the transition of the middle office to the debt management office by looking at issues such as legislative changes. The middle office will have a lean workforce, which will initially study the debt markets and government borrowings. Later it is expected to take over various functions that the central bank does right now like deciding on the timeline of Centre’s borrowings. The Centre formally announced the decision to set up a debt management office in Budget 2007-08. The idea of forming a debt management office gained momentum in recent years with the enhanced Central government borrowing programme. The Centre borrowed 4.51 lakh crore in 2009-10 and is set to borrow Rs 4.47 lakh crore in 2010-11.