1. Disinvestment target will be achieved this year: Ashok Lavasa, Finance Secretary

Disinvestment target will be achieved this year: Ashok Lavasa, Finance Secretary

The government has cut expenditure moderately from the revised estimate (RE) level to achieve the fiscal deficit target of 3.5% in 2016-17.

By: | Published: May 9, 2017 7:34 AM
In an interview with Prasanta Sahu, finance secretary Ashok Lavasa says in the current year, expenditure will be front-loaded for those schemes which require such policy. (PIB)

The government has cut expenditure moderately from the revised estimate (RE) level to achieve the fiscal deficit target of 3.5% in 2016-17. In an interview with Prasanta Sahu, finance secretary Ashok Lavasa says in the current year, expenditure will be front-loaded for those schemes which require such policy, but that may not be the case for all heads of expenditure. “The ministries concerned have the flexibility to calibrate spending,” he said. Excerpts:

Did government achieve the FY17 expenditure targets and the fiscal deficit target?

The numbers are not yet final. On the Plan side, Rs 5.7 lakh crore (`20,000 crore more than BE and Rs 13,000 crore less than RE) has been spent, which is Rs 1 lakh crore higher than FY16’s achievement. Capital expenditure has also exceeded the budget estimate. On the non-Plan side, the spending was lower than the target in FY17 (about Rs 28,000 crore less than BE and Rs 30,000 crore from RE). Overall, spending last year should be around Rs 19.71 lakh crore (slightly less than BE of Rs 19.78 lakh crore and about Rs 43,000 crore less than RE of Rs 20.14 lakh crore ). But we had not imposed any restrictions on spending. We are confident that we will achieve the 3.5% fiscal deficit target in FY17 (Tax revenue in FY17 stood at Rs 17.1 lakh crore, Rs 13,000 crore higher than the RE, but there were slippages on the non-tax revenue side).Earlier, the Budget used to be approved in May, but the FY18 Budget was approved before the new year began.

Has the spending begun from April itself?

We are expecting that the pace of expenditure in April will show an increase over last year. The spending was a mix of social sector, education, health and some of the infrastructure sectors. Secondly, the Plan period is over with the conclusion of the 12th Plan.

All the schemes which are to continued have to be evaluated and appraised again. This process is going on. We have drawn out a list of all the schemes, department-wise, which will require evaluation. The third thing what we have done is that pending their reappraisal, we have allowed the ministries to spend on such schemes which they want to continue till September without appraisal. The other change that we have brought about in order to speed up the decision-making process is to combine Expenditure Finance Commission (EFCs) with Committee on Establishment Expenditure to reduce the gap between approval of schemes and sanction for creation of staff for their implementation.

What is the strategy for expenditure management for the year?

Our effort is that there should be expenditure as per requirement. There are some schemes which may not require to spend in the early part of the year, but need more expenditure in the third or fourth quarter. There could be some where departments want to spend early. We have given that flexibility to the departments. They have to draw up their quarterly and monthly expenditure plans. But if one department wants to front-load, it will have to state that very clearly. Questions may arise about the impact on budget allocation. Obviously, requirement of such departments in the remaining period will be less.

Why were benefit disbursals via the Aadhaar payment bridge only 33% of the total Rs 67,731-crore direct benefit transfers (DBT) in FY17 despite 80% of Aadhaar seeding with bank accounts complete?

This is a work in progress. It may differ from scheme to scheme. I am sure it will gather momentum in the near future. Initially, some schemes have been identified and our effort is to bring them to the DBT platform as early as possible. There are some practical limitations of the system and we also have to keep in mind the experience while implementing DBT.

Little progress has been made on DBT in fertiliser and food. Any timeline for their full roll-out?

Based on the experience of the DBT pilot in 19 districts, fertilisers will see a faster roll-out through the DBT mode. We are yet to see the result of the DBT pilot on food.

Are you confident about meeting the ambitious disinvestment target of Rs 72,500 crore for FY18?

Disinvestment target will be achieved this year. Even people were not expecting the government to achieve `46,246 crore (as against the BE of Rs 56,500 crore) in FY17, but we still did.

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