BENGALURU: The state finance audit report of the Comptroller and Auditor General of India for the year ended March 31, 2021 has pointed out that the share of expenditure under social services decreased by around 3 per cent during the financial year as compared to the previous year.
The CAG noted, “Adequate priority needs to be given to education and health sector as the ratio of expenditure under the sector to aggregate expenditure was less than the general category states and some of its neighbouring states.’’
Experts said the reduction was because of the pandemic and resulting poor collection of taxes. The report noted that Karnataka, which had recorded revenue surplus since 2004-05, witnessed a revenue deficit for the first time in 2020-21 to the tune of Rs 19,338 crore.
Burden of interest payment an increasing trend: CAG
AGAINST the projected revenue of Rs 69,592 crore, actual taxes collected by the state and GST compensation received aggregated to Rs 60,660.32 crore, a shortfall of Rs 8,932.17 crore. The CAG noted that open market loans amounted to 63 per cent in the total fiscal liabilities, including off-budget borrowings, by the state.
The burden of interest payment was on an increasing trend, and the ratio of interest payment to revenue receipts was highest during 2020-21 at 14.95 per cent. The CAG noted that against the total provision of Rs 2.65 lakh crore, expenditure incurred was Rs 2.42 lakh crore which meant an unspent provision of Rs 22,526.24 crore. It stated that orders were issued for incurring additional expenditure of Rs 5,281.70 crore without approval from the legislature.
These executive orders were later regularised through supplementar y demands. During 2020-21, the state government amended the Karnataka Fiscal Responsibility Act to raise the fiscal deficit from 3 per cent to 5 per cent of the estimated Gross State Domestic Product as a one time relaxation due to the pandemic.
