ADP spending lowest in eight years

The ministries and divisions managed to spend only 89.34 percent of their development budget in the just-concluded fiscal year, the lowest in eight years.

A planning ministry official said the spending was low mainly because some mega projects could not mobilise foreign funds.

The development spending in 2016-17 was however 21 percent higher than that of the previous fiscal year.

The annual development programme (ADP) implementation rate was 86 percent in 2008-09.

It started to go up gradually in the following years, consistent with the increase in the size of the development budget.  

But the implementation rate began to slow down from 2014-15 as the implementation capacity of the ministries and division has not kept pace with the increase in the size of the development budget, among other reasons. 

The implementation received a further blow last year because of a number of militant attacks, including that on Holey Artisan, which slowed some projects, particularly those financed by Japan.

However, most ministries and divisions fared well in reaching their spending goal in FY17.

The ministries and divisions spent Tk 106,581 crore against the revised allocation of Tk 119,296 crore, according to statistics of the Implementation Monitoring and Evaluation Division (IMED).

In FY16 the ministries and divisions spent Tk 87,097 crore, which was 92.72 percent of their allocation.

Twelve ministries, which together received 85 percent of the total development budget, performed very well.

The science and technology ministry spent 96 percent of its allocation.

The road transport and highways division spent 99.76 percent, the secondary and higher secondary education division 90.42 percent, and the primary and mass education ministry 88.84 percent.

The local government division spent 96 percent, the housing and public works ministry 100 percent, the water resources ministry 90.42 percent, the energy division 94 percent, and the disaster management and relief ministry 96.75 percent.

Some even overshot their allocation: the power division spent 101 percent, the post and telecommunications ministry 119 percent and the shipping ministry 106 percent.

But the health and railways ministries and the bridges division fell short of spending the money given to them.

The bridges division is implementing only three projects but these are large scale and important projects.

The revised allocation for the bridges division in the last fiscal year was Tk 6,583 crore. But it could spend only Tk 3,687 crore, which is 56 percent of the allocation.

One of the major projects under the division is the Padma bridge project. The original allocation for the project for the last fiscal year was Tk 6,026 crore but it was brought down to Tk 4,674 crore in the revised budget.

Still, the high priority project of the government could not reach the revised spending target, according to a planning ministry official.

“However, the physical progress of the project is good,” said the official, seeking anonymity.

Another big work under the division is the Karnaphuli tunnel project being bankrolled by China.

The budget set aside Tk 2,000 crore for the project which was later slashed to Tk 1,421 crore in the revised one. But a big part of it could not be spent.

A loan agreement was signed with Chinese Exim Bank to mobilise funds for the project during the Chinese president's Dhaka visit in October last year. But the Chinese bank has not activated the loan yet, said the official.

The present government has taken an initiative to rejuvenate the railway sector.

But the railway ministry could spend only 65 percent of the revised allocation. It spent Tk 6,067 crore against the allocation of Tk 9,278 crore.

A key project under the railway ministry is the Padma Bridge Rail Link project, which will run from Dhaka to Jessore.

In the last fiscal year, Tk 4,813 crore was allocated for the Tk 35,000 crore-project.

China will finance the project but the finance ministry and the Chinese authorities are still exchanging letters on the terms and conditions.

The planning ministry official said the second phase of the project has not started in full swing.

The health ministry was able to use 80 percent of the revised allocation.

Some 93 percent of the government's own fund was spent in the last fiscal year, which was 94 percent in the previous year.

On the other hand, 78 percent of the foreign funds were utilised in 2016-17 in contrast to 89 percent a year earlier.

State-owned enterprises spent 100 percent of their allocation.

As seen in the past, the ministries and divisions go on a spending spree in the last month of the fiscal years so their full-year performance looks better -- an exercise that leads to misuse of money, according to economists. This continued in the last fiscal year as well, they said.

Between July last year and May this year, Tk 77,204 crore was spent, meaning an average monthly expenditure of Tk 7,018 crore in the first 11 months of the last FY. On the other hand, Tk 29,377 crore was spent alone in June, the last month of the fiscal year.