Jal Shakti, Skills ministries lag as railways lead pack in total spending

Consumer affairs and railways lead FY26 spending so far, as FinMin launches early pre-budget consultations to ensure fiscal prudence and even-paced expenditure

Expenditure by ministries till August has been around 37 per cent of the Budget estimate (BE) for FY26 with the finance ministry having begun pre-Budget interministerial consultations on October 9. 

 

While the initial discussions are focused on arriving at the revised estimate (RE) for FY26, the ministries would be submitting their BE for next financial year as well.

 

The government is confident of keeping the fiscal deficit at 4.4 per cent for this financial year even amid a slowdown in revenue collection so far. 

 

“Typically, in these meetings the government gets a greater clarity about the pace of expenditure in the first half of the financial year and detailed stocktaking takes place, including any reprioritisation that may be required,” a senior government official said. 

 

Among the top spending ministries, the Ministry of Consumer Affairs, with an allocation of ₹2.16 trillion, and the Ministry of Railways, with ₹2.55 trillion, had spent more than half their allocation till August for FY26, according to the Comptroller and Auditor General data.

 

The two ministries had spent 55 and 52 per cent, respectively, of their BE for April-August. 

 

“This exercise happens early in the year now to have more evenly paved expenditure. Serious explaining has to be done by ministries for any major diversion from what was set out in the Budget,” the official added. 

 

Expenditure by the Ministry of Petroleum and the Jal Shakti Ministry is among the lowest with just 3 per cent and 4 per cent of the allocation spent between April and August. The Ministry of Skill Development is the third-lowest with 8 per cent. 

 

The finance ministry has asked other ministries to furnish brief notes explaining major variations between the BE and RE.

 

Also, in their “Statement of Budget Estimates”, the ministries have been asked to give notes when the BE for FY27 exceeds the RE of FY26 by more than 10 per cent. 

 

“The explanation should be meaningful and specific. Vague statements such as ‘due to less requirement of the project’ or ‘more requirement of the project’ may be avoided,” the circular said.

 

Frontloading capital expenditure

 

After the pace of capital expenditure (capex) suffered on account of the Lok Sabha elections and the model code of conduct last financial year, capex for the first five months in FY26 stood at 38.5 per cent of the BE compared to 27 per cent last year. 

 

The Ministry of Railways and Ministry of Road, Transport and Highways have been driving capex.

 

Each spent 44 per cent and 43 per cent, respectively, of its capital allocation during April-August. 

 

Among the laggards is the Ministry of Science and Technology, having utilised nothing of nearly ₹ 20,000 crore allocated. 

 

The Department of Economic Affairs (DEA), which had kept ₹46,613 crore as capex, has utilised 2 per cent of the amount. 

 

An earlier report by a parliamentary panel had urged the DEA to revisit the extant practice of allocating funds that are not directly related to the department, such as allocations for new schemes that have not been finalised.

 

It had said it was imperative for the DEA to uphold financial discipline and fiscal prudence while making budgetary allocations.