Indecision, delay in clearing files and to a certain extent political upheavals seem to have crippled the State administrative machinery.
Implementation of several of the budgetary schemes and projects, especially those in the plan component, is happening at a snail’s pace, affecting development.
For the first time in the recent past, the plan expenditure of the government in the first quarter of the current fiscal (April to June) has slumped.
The government has been able to spend only about Rs 3,320 crore against Rs 4,150 crore during the same period of last year – a difference of a whopping Rs 850 crore, according to the receipts and expenditure document released by the Finance department (FD).
Going by the sheer size of the budget (outlay of Rs 1,02,742 crore) and the number of new schemes announced, the plan expenditure for development work in the current year should have been much more.
While the budget 2011-12 had pegged the plan expenditure target at Rs 34,644 crore, it is Rs 40,240 crore in the current fiscal. Compared to last year’s budget, the government has not announced any new scheme in the 2012-13 fiscal.
Launching of new schemes usually consumes a lot of time and, as a result, delays the expenditure process.The FD officials, who refused to be quoted, said the political turmoil that the State underwent between April and June, leading to D V Sadananda Gowda making way for Jagadish Shettar as chief minister, had cast a shadow on the administration.
The decision making process had come to a standstill and files pertaining to key policy decisions had piled up. Heads of departments chose to put a break on expenditure, anticipating change of guard. This was despite the FD for the first time authorising heads of all spending departments to draw up to 50 per cent of allocated money (scheme-wise) without any approval, officials pointed out.
The expenditure has dropped despite the State doing well in the revenue receipts front.
Though the national economy continues to be gloomy, the State has managed to mobilise revenue to the tune of Rs 17,657 crore, including Rs 13,471 crore of own tax revenue in the first quarter against Rs 13,960 crore during the same period of last year. As a result, the government was sitting on surplus revenue of Rs 5,452 crore at the end of the first quarter.
FD’s letter
Concerned with nosediving plan expenditure, the FD has recently dashed off a letter to heads of all 28 spending departments to look into the issue and take necessary steps to speed up implementation of budgetary programmes and schemes.
If the same expenditure pattern continues in the second quarter (July-September), it will be a matter of grave concern, officials said.However, the non-plan expenditure in the first quarter (spending mainly on routine administration and maintenance) has increased compared to last year’s – from Rs 8,937 crore in 2011-12 to Rs 10,448 crore.
Ironically, the government should be aiming at cutting down the non-plan expenditure so that money saved can be utilised on development (plan expenditure).
Both Additional Chief Secretary L V Nagarajan and Principal Secretary to FD Ajay Seth were not available for comments.
Dr R S Deshpande, Director, Institute for Social and Economic Change said that political instability and indecision may not be the sole reason. It is effective governance at bureaucratic level which matters most. The sluggish growth could be due to indecision about location of a mega project, lack of appraisal of schemes, delay in documentation etc.
Karnataka is the best in the country in terms of fiscal management, he said.
