Following exposé of the alleged illegal parking of funds in the Rural Development and Panchayat Raj Department, the Fiscal Management Review Committee (FMRC) headed by Chief Secretary Kaushik Mukherjee has instructed principal secretaries, secretaries, and directors of various departments to not park unutilised grants and funds in bank accounts.
The committee said that there has been a tendency to draw funds and keep the same either in deposit accounts or bank accounts to avoid lapse of budgetary provisions at the end of the financial year. In such cases, though the expenditure gets booked, the actual realisation of funds will happen much later.
“Administrative departments shall ensure that such idle parking of funds outside is completely avoided,” the panel said.
The instruction from the Chief Secretary came after RDPR Minister H.K. Patil cracked the whip on the alleged illegal parking of funds to the tune of Rs. 500 crore in multiple bank accounts in Bengaluru by some department officials for pocketing the interest.
Referring to the Mid-Year Review of State Finances (2015-16), the panel told departments to utilise reserve funds and deposits maintained in the public account to meet the net additional expenditure.
The review has observed that it is necessary to improve the quality of expenditure in the Water Resources and Public Works Departments owing to higher capital outlays to these two sectors.
The State’s economic growth in 2015-16 was estimated at 7.4 per cent of the Gross State Domestic Product (GSDP).
Receipts
The total receipt of the State during April-September 2015 was Rs. 54,192 crore, including the State’s own tax revenue of Rs. 35,671 crore. The State’s own non-tax revenue stood at Rs. 2,213 crore.
Liabilities
The total outstanding liabilities to the GSDP was expected to increase from Rs. 1,16,747 crore in 2014-15 to Rs. 1,80,815 crore in 2015-16. The total liabilities to GSDP ratio would remain within 25 per cent.
Revenue
The State has been maintaining revenue surplus of Rs. 4,381 crore as compared to the budget estimate of Rs. 911 crore, reflecting a comfortable mid-year revenue position.
The revenue surplus would be maintained at the end of 2015-16, the mid-year review report said.
Off-budget borrowings
It said that off-budget borrowings of Rs. 2,250 crore have been allowed for the special purpose vehicle of Water Resources Department agencies such as Krishna Bhagya Jal Nigam Ltd., Karnataka Neeravari Nigam Ltd., and Cauvery Neeravari Nigam Ltd.
The Finance Department has allowed the Karnataka Police Housing Corporation to borrow Rs. 250 crore.
