Govt spending soars on new pay scale

Total expenditure in the first quarter of fiscal 2016-17 was 15.5 percent higher than a year earlier thanks to full implementation of the pay scale for government staff and various non-government educational institutions.

Between the months of July and September last year, total spending stood at Tk 42,894 crore, according to a report from the finance division.

The report, which provided the up-to-date picture of budget implementation and the economy, was presented in parliament on Sunday by Finance Minister AMA Muhith.

In fiscal 2016-17 the new payscale along with allowances was implemented in full, said a finance ministry official. Besides, the salary scale for non-government school, college and madrasa teachers came into effect this year.

“For this reason, there has been a big jump in non-development spending,” he added.

Non-development expenditure shot up 19.35 percent to Tk 35,325 crore in the first quarter of the fiscal year. In contrast, a year earlier, non-development spending was 0.32 percent lower than the previous year.

This fiscal year, a big development budget was sanctioned -- Tk 110,700 crore -- but the implementation capacity of the ministries and divisions did not increase much.

In the first quarter, the ministries and divisions spent Tk 7,569 crore, up 0.42 percent from a year earlier.

“A big challenge to meeting this fiscal year's growth target is successful implementation of the annual development programme,” Muhith said in parliament.

To accelerate the rate of project realisation, stress has been given on coordination among the Economic Relations Division, donor agencies and the ministries and divisions implementing the projects, he said.

Regular monitoring of the progress of the big projects would also be done. Among the ten large ministries and divisions, the bridges division spent the highest in the first quarter -- 19.51 percent of its full-year allocation.

The education ministry came in next at 18.74 percent, followed by home ministry at 18.33 percent, primary and mass education 14.82 percent, health ministry 13.75 percent and power division 11.07 percent. The local government division managed to spend only 5.55 percent of its allocation in the first quarter, railways ministry 4.73 percent, agriculture ministry 6.93 and road division 6.41 percent.

The government's revenue earning performance also improved in the first three months of fiscal 2016-17 thanks to strong efforts by the National Board of Revenue.

A total of Tk 43,517 crore was deposited in the state coffer during the months of July, August and September of last year, up 13.90 percent year-on-year.

The NBR's taking swelled 17.94 percent in the first quarter in contrast to 9.96 percent a year earlier.

Though the government receives a big amount of revenue from non-NBR sources, this time the performance is very poor on that front. In first quarter of the fiscal year, the non-NBR tax collection declined 5.81 percent. A year earlier, it soared 27.06 percent year-on-year.

Non-tax revenue crept up 0.50 percent in the July-September period in contrast to about 8 percent a year earlier. “In the first quarter the revenue was less than one-fifth of the target,” Muhith said, adding that the drive to boost revenue collection will have to be intensified. The finance minister also mentioned a number of VIP visits last year, who signed a total of 10 agreements, including one on grant and four on loans. Through the agreements about $20 billion of foreign aid will be made available for 27 projects, he said.