In keeping with tradition, the implementation of Annual Development Programme became faster in the later months of the fiscal year compared to the first half.
Hurried spending wastes government money and makes room for corruption, Research Director of Bangladesh Institute of Development Studies (BIDS) Zaid Bakht said.
In the first 10 months of the current fiscal year, ADP implementation was Tk 20,909 crore or 60 percent of the revised allocation, which means average monthly expenditure was about Tk 2,090 crore.
However, in the first month ADP implementation was Tk 836 crore or two percent of the allocation. In the first quarter, the average monthly expenditure was Tk 1,119 crore.
The government has already slashed the current fiscal year's ADP by more than Tk 3,000 crore to make it Tk 35,130 crore.
As per the revised plan, in the last two months of the current fiscal year the government will spend Tk 7,110 crore every month.
As the fiscal year is drawing nearer to an end, the expenditure is getting faster and with it government's bank borrowing is increasing. In the first six months of the current fiscal year the government's bank borrowing was very small. After 10 months the government has borrowed Tk 11,380 crore from the banking system.
In this year's budget, the government set a target to borrow around Tk 15,000 crore but it may exceed this target.
A Bangladesh Bank official said if the government borrows steadily every month as per its target it does not have any negative impact but if it borrows a huge amount in a small period, it destabilises the money market.
A high official of the planning ministry said after presenting the national budget every year the finance minister in the post-budget press conference urges secretaries to start implementing the ADP from the beginning of the financial year.
The ministries are told to make the purchasing plan ahead of the start of the fiscal year. But the situation does not change, planning ministry officials said. Most of the projects of the ADP are on-going.
According to planning ministry information, in the last fiscal year the total ADP utilisation was Tk 25,917 crore. In the last two months the expenditure was Tk 9,216 crore. In the last month the expenditure was Tk 6,395 crore.
Planning ministry officials said on many occasions the ministries do not actually spend the money rather show it spent. They show expenditures against different departments and divisions of various ministries. As a result, in the last month a high expenditure is shown.
Even on the last working day of the fiscal year, Tk 2,000 crore to Tk 3,000 crore was released from the government account in Bangladesh Bank.
Zaid Bakht said spending 40 percent of the allocations in 2 months would not only waste public money but also have detrimental effect on the quality of the completed projects.
Zaid Bakht was a member of the public expenditure review commission. Drawing from experience, he said there were instances where cheques were issued to show that the money was spent but in fact it was not and no work had been done.
The government takes up challenging ADPs with a large number of projects but the ministries concerned do not have the capability or the efficiency to implement them, which creates these problems.
A planning ministry official said hurried expenditure at the end of the year results in the government's original plan for ADP failing its goal. Even though ministries fail to implement the ADP fully at the end of the year, they make demand for more allocation.
Implementation Monitoring and Evaluation Department (IMED) in its report prepared in March mentioned several problems in ADP implemention.
The ministries take up more projects than the resources allocated to them under the medium-term budgetary framework. As the number of projects increases, both the tenure and expenditure go up.
In the current fiscal year, the number of total projects was 916, in the revised ADP allocation was cut by more than Tk 3,000 crore but the number of projects increased to 1,185. The planning ministry official said this is a yearly phenomenon.
According to the IMED report, the projects the government takes every year cannot be completed for the lack of necessary resources. In the current fiscal year, 287 projects were scheduled for completion but in the revised budget the number was reduced.
Project implementation is delayed due to various reasons including change in the project design, inefficiency and failure to release funds.
Source: The Daily Star (May 22, 2011)
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