Patna: The CAG report for the financial year 2016-17 has raised questions about financial management of the state government, especially its failure to check the "rush of expenditure" in the closing month of the financial year - popularly called "March Loot".
The report, tabled by deputy chief minister Sushil Kumar Modi in the Assembly on Monday, points out that 11 key departments had shown expenditure of more than a third of its total budget in the month of March 2017. The CAG has maintained that the Bihar budget manual stipulates the rush of expenditure, particularly in the closing month of the fiscal, as a financial irregularity and should be avoided.
The major departments which witnessed a March rush for expenditure include agriculture, building construction, art, culture and youth affairs, urban development and housing, water resources, food and consumer affairs. In the backward and most backward classes welfare department, more than 99 per cent of the budget was shown in the month of March.
Another area the CAG has objected to is "suspense account" - payment of funds which have yet to be reconciled in government accounts. It has pointed out that during the last five years - 2012-13 to 2016-17 - the amount in suspense accounts has jumped from Rs 1,749 crore to Rs 4,959 crore. The suspense account has been identified in payment of salaries, civil payments, TDS payment and material purchase settlement.
The report also shows that the state government still lags behind when it comes to providing a detailed contingency (DC) bill. The CAG has pointed out that gross expenditure includes Rs 1,809 crore drawn on abstract contingency(AC) bills. DC bills are outstanding for the sum of Rs 1,370 crore.
The report indicates that though GSDP of the state increased by 15 per cent between 2015-16 and 2016-2017, the revenue collection increased by only 10 per cent.
The increase in total tax collection was mainly due to corporation tax, sales tax, service tax and customs. It has also maintained that state's own tax revenue to GSDP is lower than the target of 6.4 per cent recommended by the 14th Finance Commission. In 2016-17, the state's own tax was just 5.42 per cent of the GSDP.
The report also points out that during 2016-17, revenue expenditure fell short by over Rs 15,000 crore. It has maintained that the state is unable to spend whatever has been budgeted though the resources were available.
