Central government expenditure: 4 key facts on spending

By: | Published: January 7, 2015 10:12 AM

Central government, as a whole, manages to spend more than the mandated 64 per cent in the first nine months of the fiscal, ministry wise spending is often uneven.

Prime Minister Narendra Modi has directed ministers to spend budgetary allocations to each ministry evenly throughout the year, rather than bunching up expenditure in the last quarter of the fiscal. However, while the Central government, as a whole, manages to spend more than the mandated 64 per cent in the first nine months of the fiscal, ministry-wise spending is often uneven.

1.  According to finance ministry guidelines, government ministries and departments should not spend more than 33 per cent of their budgeted allocation in the last quarter of the fiscal.

2. The finance ministry norms also restrict expenditure by ministries on schemes to 15 per cent of the Budget Estimates.

3. By November 31, 2014, the Centre’s total expenditure was Rs 10,74,183 crore or 59.8 per cent of the Budget Estimate of Rs 17,94,892 for 2014-15.

4. Analysts say that a rush of expenditure in the last quarter impacts the quality of spending as well as delivery of services. “Bunching of non-plan expenditure such as subsidies, impacts the entire chain of payments and cash flow of not only the government but also the receiving agencies,” said DK Pant, chief economist, India Ratings.

govt-expenditure

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