Development spending still not picking up
Less than half of the development budget could be spent in the first nine months of fiscal 2016-17 but the planning ministry is still hopeful that full implementation would be possible in the remaining three months.
Between July of last year and March of this year, the ministries and divisions managed to spend Tk 53,864 crore, which is 45.15 percent of the total allocation for fiscal 2016-17, according to Implementation, Monitoring and Evaluation Department.
A year earlier, they spent Tk 41,975 crore, which was 44.70 percent of the total budget for fiscal 2015-16.
Although the ministries and divisions managed to exhaust a greater sum, there has not been much of an improvement this year.
“So far this year, the implementation has been good,” Planning Minister AHM Mustafa Kamal told reporters after Tuesday's meeting of the Executive Committee of the National Economic Council.
He went on to express hope that the whole allocation could be spent this year.
The planning ministry has taken up a number of reform initiatives, all of which have improved the implementation capacity, Kamal said.
Although ADP allocation increases every year, its performance is evaluated by calculating amount used out of the total outlay, which is called the implementation rate.
The implementation rate this year is still low in comparison to the historical trend.
Development spending has been slow since fiscal 2012-13 in terms of percentage of the total outlay.
In the first nine months of fiscal 2012-13, ADP implementation stood at 47 percent, with the rate progressively declining since.
Although the spending of local funds increased, which was the main reason behind the rise in ADP implementation, the utilisation of foreign funds is still on par with last year.
During the July-March period of the fiscal year, nearly 45 percent of the government's own fund for the year was utilised, up from 42 percent a year earlier.
However, foreign fund utilisation during the period stood at 41.81 percent, which was 47.45 percent last year at this point.
Only three of the ten large ministries and divisions that got 73 percent of the total allocation registered higher than the average implementation rate during the period.
They are: power division (57.96 percent), housing and public works ministry (67 percent), local government division (51.38 percent).
The other five ministries spent much lower than the average, with the bridges division managing only 35.52 percent implementation. The bridges division got most of the allocation for the construction of Padma bridge.
Of the remaining large ministries, the railway ministry spent 30.72 percent, road transport and highways division 39.18 percent, secondary and higher education division 33.41 percent, science and technology ministry 28 percent.
Two ministries managed the average implementation rate of 45 percent: health and family welfare ministry (44.24 percent) and primary and mass education (45.76 percent).
Though the ministries could not go ahead much in ADP implementation, the state-owned enterprises set a new record.
Implementation by state-owned enterprises during the July-March period stood at 73 percent of their total outlay of Tk 4,232 crore.
In reality, the state-owned enterprises' performance did not improve; rather, their allocation was slashed, which flattered their implementation rate. Their original allocation was Tk 12,664 crore.