PANJIM: In a clear indication of a cash crunch, the State Finance Department has put a 25 percent cut in revenue expenditure of all the departments for the last quarter of the financial year 2018-19, as part of economic measures and rationalisation of expenditure. It has also capped expenses for the last three months of the FY to not more than 1/5th of the budgetary estimates.
The Office Memorandum (OM) on rationalisation of expenditure is normally issued in January, however, this is for the first time that it has been issued in October, and also includes guidelines for Quarter III.
Finance Secretary Daulat Hawaldar in an OM issued said that expenditure for each month of the Quarter III – October to December 2018 and Quarter IV- January- March 2019 shall be done wholly based on the Monthly Expenditure Plan (MEP) vis-à-vis liquidity position of the State treasury.
In order to effectively monitor the expenditure pattern as well as reduce rush of expenditure during the last quarter, the departments have been asked to prepare MEP (separately of Capital and Revenue account) as well as Monthly Revenue Plan (expected), so that Finance Department can regulate the expenditure vis-à-vis, revenue collection keeping in mind disbursements under flagship schemes and expenditure on development, as well as enhanced provision for implementation of Seventh Pay Commission.
“Government has, from time to time, issued various instructions on economy measures, rationalisation of expenditure, etc. in order to achieve the targets and standards set out in the Goa Fiscal Responsibility and Budget Management Act, 2006, as also to provide adequate funds for developmental activities under capital account and curb unnecessary expenditure on revenue account,” the memorandum states.
While finalising the MEP, the departments have been asked to bring into effect a 25 percent cut in revenue expenditure including interest payments, repayment of debt, payment of salaries and pension. “No re-appropriation of funds to augment revenue heads of expenditure other than salaries and pensions shall be allowed during the current financial year,” Hawaldar said.
The memorandum further said that not more than 1/5th of the budgetary estimates shall be spent in last three months of this financial year, except under flagship schemes of the government and wherever possible revenue expenditure may be reduced by 25 percent till financial year end.
“During the months of February and March, the expenditure of each department should be limited to 8 percent of the budget estimate and in no case should it exceed the limit prescribed. This limit is to be enforced both scheme wise as well as for the demands for grants as a whole,” the memorandum states.
It says that for the months of January to March 2019, payment should be made for goods and services actually procured and other related expenses, made in the previous months and not for new items of purchase with exception of advance payment, payment to contractors, loans and advances, etc.
Hawaldar has specified that any excess expenditure required to be carried out has to be done with prior concurrence of the Finance Department that will revalidate the figures for the month concerned and for the quarter overall. The proposal for excess expenditure should be properly justified and submitted at least ten days before the end of month concerned.
The departments have been directed to nominate a Nodal Officer for each Demand of Grants.
