New Delhi, March 21: The Comptroller and Auditor General (CAG) told Parliament that low fiscal deficit was due to the government’s failure to spend the money allotted to welfare schemes.

In its report on public finances, CAG has pegged the fiscal deficit at 3.34 per cent of the GDP for 2004-05 compared with the finance ministry’s estimate of 4.4 per cent. Unable to pinpoint the exact reasons for the gap, CAG officials said, “The exceptional low fiscal deficit is a result of a debt swap scheme, which saw states returning money they owed the Centre through a book transfer.”

The low fiscal deficit was caused by the failure of government departments to fully utilise the allotted money rather than by an attempt to trim profligacy on the part of the government, CAG said.

In 2004-05, the department of reproductive and child health could not spend 43 per cent of its allotment of Rs 225 crore, while 61 per cent of Rs 5,032 crore allocated remained unused.

Decline in capital expenditure and loans and advances relative to the budget estimates also contributed to the reduction in fiscal deficit, officials said. They added that total disbursement of the Centre increased from an average of Rs 4,33,716 crore during 1992-97 to Rs 15,84,585 crore in 2004-05. But yet the money spent remained colossal.

“Better targeted spending and less returns to the exchequer would perhaps help bring social goods to the people faster,” CAG officials said.

CAG has also taken the ministry of tourism on task for incurring irregular expenditure of over Rs 83 lakh on engagement of staff in Indiatourism offices abroad.

In its report tabled in Parliament today, CAG said the engagement of staff abroad was paid from contingencies against vacant posts or for work of regular nature.

This was “in disregard” of instructions given under the financial powers of the government of India.

According to the powers defined, regional directors or directors of India tourism offices abroad could employ only class IV staff and pay them from the contingency subject to certain conditions.

According to the conditions laid, the temporary staff should not be employed for a work of regular nature or against the vacant posts borne on the regular establishment.

CAG said, “India tourism offices in London, Milan and Paris had been engaging contingency-paid staff from July 2001 to March 2005 for work of regular nature or against vacant posts.”

The report also described the response of the ministry as “not tenable”. It said while Milan was appointing the temporary staff only during peak season to cope with the workload, the office in Paris was finding it difficult to appoint a candidate to the post of secretary as the benefits offered were not attractive enough.