States fare badly in using Plan funds
Punjab, Bihar used less than 50% of funds
| Funds utilisation by even progressive states like Punjab has been below 50 per cent. In some years, Punjab's performance has been at par with Bihar, considered a backward state. |
| Also, the financial position of the states is precarious. Interest payments as a proportion of states' revenue expenditure rose from 12 per cent in 1990-91 to 22 per cent in 2003-04, while pension expenditure rose from 0.9 per cent to 9.4 per cent in the same period. As a result, the Tenth Plan outlay has been slashed in several areas. |
| In Rajasthan, for instance, while the outlay for 'agriculture & allied activities' was Rs 224 crore in the annual Plan for 2002-03, it was reduced to Rs 76 crore when it was found the state could not possibly spend more. This is a big drop from the Rs 317 crore outlay under this head in 1997-98. |
| In Punjab, expenditure on 'agriculture & allied activities' went up from Rs 49 crore in 1997-98 to Rs 138 crore in 2000-01, representing an 80 per cent usage of the Plan outlay for that year. |
| In 1999-2000, however, a mere 54 per cent of the funds were utilised. In that year, the utilisation of funds for rural development was even lower at 44 per cent. |
| Though Punjab has a record of spending 70 per cent of its annual outlay on irrigation (except in 1999-2000 when it was 40 per cent), this performance is not matched in 'social services', which includes expenditure on education and health. |
| In 1997-98, 65 per cent of the outlay for 'social services' was utilised, this fell to 54 per cent in the next fiscal, rose to 62 per cent in 1999-2000, and 65 per cent the year after. |
| West Bengal's record in utilising Plan funds is also not very good. In 1997-98, the state spent just Rs 78 crore of the Rs 151 crore outlay for 'agriculture and allied activities'. |
| While the actual expenditure figures are not yet available on the Planning Commission website, the revised expenditure in 2002-03 is just around 56 per cent of the approved outlay under this head. |
| For rural development, the state's revised outlay is down to around a third of the actual approved outlay, while for irrigation and flood control it is less than a fourth of it. Also, the state only spent 40 per cent of the funds allocated for social services in that fiscal. |
| Bihar, in 1997-98, utilised less than 40 per cent of the outlay for 'agriculture & allied activities'. This rose to 60 per cent in 2000-01. For irrigation and flood control, 70 per cent of the funds were utilised in 1997-98, which fell to 44 per cent in 2000-01. |
| In states like Madhya Pradesh and Orissa, the gap between the expenditure and the Plan outlay is small. Indeed, there are several instances where expenditure is higher than the original outlays. |
| Little can be said about states like Andhra Pradesh and Gujarat, as the Planning Commission does not have details of their expenditure under different heads for most years. |
| States' expenditures have not only gone down in relation to the original outlays, they have also gone down over consecutive years. |
| Expenditure on social services, on both the capital and current accounts, has gone down from 33 per cent of total expenditure in 1990-91 to 25 per cent in 2003-04. |
| In the same period, expenditure on education fell from 17 per cent to 13 per cent, while on medical and public health it went down from 5 per cent to 3 per cent. For agriculture, it slipped from 8 per cent to under 4 per cent. |