Fund utilization hits 10-yr low of 13.47 per cent
Only two of the 38 departments have achieved more than 30 % utilization
By : R Ayyappan
Update: 2014-10-07 05:11 GMT
THIRUVANANTHAPURAM: The first half of the 2014-15 has virtually gone down the drains in terms of development. In the first six months ending September, the plan fund utilisation is an abysmal 13.47 percent, the lowest in over a decade. This also means that in the next six months a revenue-starved state should spend over Rs 17,306 crore, more than the plan outlay for the last fiscal (2013-14).
The target set by the Planning Board by the end of September, to avoid bunching of expenditure in the last quarter, was 30 percent utilization. Only two of the 38 departments have achieved more than 30 percent utilization: public works (67.29 percent) and health and family welfare (37.52 percent).
Reflecting the fiscal crisis, the spending had been progressing at a snail’s pace right from the start of the fiscal. The first quarter spending (April-June) was a mere 2.73 percent, again the worst in a decade. With the growth rate of tax revenue still hovering around 10 percent as against an expected 25 percent, the sluggish trend has been sustained right through the second fiscal. Last fiscal, when the economic crisis was equally worse, the spending was better by the second quarter (18.28 percent). “This time the coffers have been swiped clean. All the money we borrow for development purposes has been used to pay salaries, interest and pensions,” a top finance official said.
By borrowing Rs 6900 crore, the state has already exhausted more than half of its borrowing limit for this fiscal. “Now, with expenditure controls in place, it would be a lot optimistic to believe that the state is going to utilize even 70 percent of its total plan outlay,” the finance official said.