New Delhi, April 4: Buddhadeb Bhattacharjee may have figured out how to court business but his government has still not understood the business of managing money.
An audit has established that the Bengal government has made a mess of its finances, which hampers its ability to fund development programmes.
The Comptroller and Auditor General (CAG) of India has found that the overall fiscal liability of the state has ballooned from Rs 54,142 crore in 2000-01 to Rs 104,334 crore in 2004-05.
Citing the figure, the CAG has raised a disturbing question. “The increasing liabilities had raised the issue of sustainability of the state government finances.”
Terms like fiscal liability have a trite ring about them that helps governments gloss over the gravity of the situation.
But in lay language, it means that the state government is left with little money to spend on development programmes ' a pet theme of the Left Front ' after it services its old debts. It is the equivalent of a family income-earner using most of the salary on paying interest and repaying a part of the loans he took earlier.
In the case of Bengal, the net funds available for development projects after providing for interest and repayments were only 35 per cent of the money it borrowed during 2004-05.
This implies that out of a total of Rs 16,124 crore that the Bengal government borrowed from various sources last year, only Rs 5,614 crore was available for funding programmes.
The remaining money ' Rs 10,510 crore ' was used to repay principals and interests of loans taken several years ago. (See chart)
This unenviable situation is partly explained by the extremely poor returns the government is receiving on investments in its own enterprises.
As on March 31, 2005, the government had inves- ted Rs 5905.99 crore in its corporations, rural banks, joint stock companies and cooperatives.
In return, the government earned ' believe it or not ' Rs 43 lakh.
But even if the state administration had more funds at its disposal, it is doubtful whether the cash would have been shovelled to development projects, a goal the CPM had set for ' and keeps reminding ' the UPA government at the Centre.
The CAG has found that development grants totalling as much as Rs 930.47 crore were lying unspent with 70 state bodies that include district primary school councils, universities, district library authorities and municipal authorities.
“These bodies did not furnish reasons for non-utilisation and non-refund of the government grants. There was nothing on record to show any action having been taken to adjust or refund the unutilised grants,” the CAG report said.