Budgetary control lax in Bihar, finds CAG-Mar 31, 2011

Budgetary control lax in Bihar, finds CAG

Faizan Ahmad, TNN | Mar 31, 2011, 11.04pm IST


PATNA: Budgetary control over various government departments in Bihar leaves much to be desired, if the audit report of Comptroller and Auditor General (CAG) of the state's finances for the financial year 2009-10 is to be believed.

According to its report tabled in the assembly recently, as many as 26 departments surrendered their entire allocated amount during the year; some others – home department for instance – surrendered more money than what they had actually not utilized; some couldn't spend the allocation but didn't surrender the money.

The CAG has also noted with concern a 'rush of expenditure' in last month of the fiscal.

For renovation of primary and middle school buildings and for providing sports facilities to the children of these schools, a sum of Rs 66.84 crore was provided to the HRD department during 2009-10. The department surrendered the entire amount!

There are altogether 26 departments which surrendered the entire allocated amount totalling Rs 522.15 crore for 69 schemes during that fiscal.

The disaster management department decided to surrender Rs 252.56 crore, meant for relief to the victims of natural calamities, on the last day of the financial year. However, its plea was not accepted by the finance department due to delayed submission of surrender papers. As a result, the amount lapsed.

There are some other departments which surrendered more money than what they had actually not utilized. For example, the home department could not utilize Rs 242.72 crore, but it surrendered Rs 251.25 crore, an excess of Rs 8.53 crore.

On the other hand, there are departments which didn't surrender the unspent amount. For instance, the art and culture department did not utilize Rs 11.13 crore, but it failed to surrender the money.

The CAG has advised the state government to strengthen its budgetary controls to avoid such deficiencies in financial management. It also expressed concern over 'rush of expenditure' in the last month of the fiscal.

Commenting on the report's findings, chief minister Nitish Kumar said on Thursday, "The CAG brings to the notice of the government the irregularities or drawbacks and the government acts on its reports." He said the government comes to know about the violation of financial rules and budget manual through the audit report. "We honour the CAG's critical comments and will try to bring reforms in financial management," he added.

The CAG has remarked, "Departments should submit realistic budget estimates, keeping in view relevant factors like trends in economy, actual requirement of funds, expenditure during the last three years, besides others."

This comment came in the backdrop of the fact that at least 45 departments surrendered a sum of Rs 3,673.56 crore out of total provision of Rs 5,500.46 crore, which is a clear indication that the departments made unrealistic demands and ultimately failed to utilize the funds. For the central rural water supply programme, a grant of Rs 657 crore was provided but the PHED could utilize only Rs 293 crore and surrendered Rs 364 crore.

The CAG detected that there were 25 grants and appropriations in which Rs 5,861 crore had not been utilized, but Rs 3,182 crore was not surrendered by the departments concerned. Also, in 43 cases Rs 6,063 crore of unutilized money was surrendered on the last two working days of March, 2010.

"Audit scrutiny revealed instances where the amount surrendered was in excess of actual savings, indicating lack of or inadequate budgetary control," said the report. It said as against the non-utilized amount of Rs 462 crore in eight cases, the total amount surrendered was Rs 483 crore, resulting in excess surrender of Rs 21 crore.
The CAG suggested strengthening budgetary control in all the departments by close monitoring of expenditure. It said that anticipated savings should be surrendered in time and excess expenditure over grants should be regularized as required under the Constitution.