The size of the revised budget for the current fiscal year (2014-15) might finally stand at Tk 2.4 trillion (Tk 240,000 crore), down by nearly Tk 100 billion (10,000 crore) from the original one, people familiar with the development told the FE.
This is a big cut compared to those carried out in the previous fiscal years. But in view of the slow growth in revenue mobilisation and slow implementation of the Annual Development Programme (ADP) this cut is quite justified, experts have said.
Officials involved in the budget preparation said they still saw the revised budget size high in consideration of the state of revenue receipts.
They said there were a lot of unavoidable expenditures taking place in the wake of developments on the country’s political front.
They said the Ministry of Home Affairs has already applied for an increase in the allocation for it.
The government wants to cut the allocation earmarked for the ADP. In the revised budget it might be an amount in between Tk 720 billion and Tk 750 billion, according to sources.
However, a summary note on the revised ADP has been prepared and despatched to Finance Minister AMA Muhith seeking his final nod for it.
The finance division has proposed three alternative amounts of resource allocation for the revised ADP (RADP). They are Tk 720 billion, Tk 730 billion and Tk 750 billion.
The three figures have been estimated in consideration of the present pace of ADP implementation which stood at 28 per cent for the July-December period, the first half of the fiscal year 2014-15.
They also pointed out the present state of revenue mobilisation both from domestic and external sources.
They cited slow ADP implementation and the lower than expected level of revenue mobilisation as the main reasons behind the latest revision of resource allocation.
The finance division also wants to cut the allocation earmarked for non-development expenditure.
The sources said the Prime Minister might raise the allocation in the final meeting with different ministries based on their actual needs.
After the Finance Minister’s approval of the RADP, the finance division will place it before the planning commission under the ministry of planning. The planning commission will then finalise the RADP by March 15. The finance division will then convey it to all divisions, commissions and other relevant offices.
The finance division will release the revised budget by March 31 next.
People familiar with the development told the FE on Thursday that they had come under tremendous pressure from different ministries not to cut their expenditure.
“There is some logic for retaining the original allocation, but there are some ministries which are demanding it without strong grounds,” said an official.
He hinted that the allocations would be retained or even raised for a number of ministries involved with law and order enforcement and other similar services.
There is a system of going beyond the allocation earlier made, when an emergency arises. The increased allocation must be passed by the Parliament in the supplementary budget.
However, in the FY 2013-14, the size of the original budget was Tk 2.22 trillion. But it was later revised to Tk 2.16 trillion, less by Tk 60 billion than the original budget.
In the FY 2012-13 the original budget size was Tk 1.91 trillion and it was cut to Tk 1.89 trillion.
In the FY 2011-12 the original budget was Tk 1.63 trillion against the revised budget of Tk 1.61 trillion.
Source: The Financial Express