Spending

Audit Report – The New Indian Express

Express press service

BHUBANESWAR: Odisha may have gone through a transformation from an income deficit economy to an income surplus economy, but the surplus is mainly due to a substantial drop in income expenditure and capital expenditure. According to the latest state finance audit report, state tax expenditure decreased by Rs 3,826 crore on the back of an increase in revenue of Rs 2,819 crore in 2020-21 compared to 2019- 2020.

Expenditure on social services decreased significantly by Rs 3,616 crore from Rs 43,517 crore in 2019-20 to Rs 39,901 crore in 2020-21. Even though Odisha performed well in emphasizing development spending, economic services spending and education spending, it lagged behind other states in the areas of health spending and spending on social services.

The main decrease in expenditure of Rs 2,394 crore in 2020-21 was on social security and social protection due to lower expenditure in the pension-social security scheme, child protection and other programs. In addition, there was a reduction of Rs 1,709 crore in water supply and sanitation expenditure.

Agricultural expenditure also witnessed a drop of Rs 2,847 crore due to a decrease in expenditure on the Krushak Assistance for Livelihood and Income Augmentation (KALIA) Yojana and Jalanidhi farmers’ welfare scheme. The audit also revealed that relief expenditure due to natural calamities increased from Rs 4,290 crore in 2019-20 to Rs 2,653 crore in 2020-21.

The total expenditure was Rs 1,14,857 crore in 2020-2021 and Rs 1,20,673 crore in 2019-20 against the budget estimate of Rs 1.5 lakh crore and Rs 1.39 lakh crore respectively. Revenue expenditure of Rs 95,311 crore was 3.86% lower than Rs 99,137 crore in 2019-20. The decrease from the previous year was mainly due to lower spending in agriculture and related activities, social protection and nutrition, water supply, sanitation, housing and urban development and the welfare of SCs, STs, minorities and CBOs.

Similarly, capital expenditure of Rs 17,949 crore was 11.48% lower at Rs 20,277 crore in 2019-20. “The revenue surplus of Rs 9,076 crore in 2020-21 increased significantly by 273% from the surplus of Rs 2,430 crore in 2019-20 due to weak expenditure. There was a decline in capital spending from 2017-18 to 2020-21,” the report said.

Economists have expressed concern about declining capital spending as it contributes directly to asset creation and is essential to the well-being of people, while revenue spending helps maintain assets and respect government debt service obligations.