The government budget expenditure in the first five months of the current fiscal year stands at 24.26 percent of Rs 1,793 billion allocated for FY 2022/23. A report published by the Financial Comptroller General Office (FCGO) shows that the government’s capital expenditure is weak while the current expenses are comparatively high.
Out of the total budget allocated for the current fiscal year, the government has spent over Rs 435 billion until mid-December, according to the FCGO report.
The government has allocated a budget of over Rs 380 billion under the heading of capital expenditure for the current fiscal year. Over Rs 33.9 billion has been spent under the same heading, which is around nine percent of the budget allocated for capital expenditure, reads the FCGO report.
The poor capital spending is nothing new in the country, which sees last-minute spending towards the end of the fiscal year.
Likewise, out of Rs 1,183 billion allocated under the current expenditure, more than Rs 354 billion has been spent. The current expenditure of the government is 29.94 percent – the highest among all the expenses.
Similarly, out of Rs 230 billion allocated towards financial management, the government has spent over Rs 46.6 billion as of mid-December. This is 20.4 percent of the budget allocated under the financial management heading.
During the review period, the revenue collection has stood at 24.52 percent of the target. The government had set a target to collect over Rs 140 billion in revenue in the ongoing fiscal year. As per the budget announcement, the government is expecting to receive Rs 550 billion as foreign grants and assistance.
The internal revenue collection so far is over Rs 300 billion which is 23.3 percent of the annual target. The government’s revenue collection this year has slumped due to the strict policy adopted to control imports in order to ease the pressure on the country’s foreign exchange reserves.
Although the government has already lifted the ban imposed on import of ten different luxury items, the restrictions imposed since last April have taken a toll on the revenue collection target.
The mandatory provision of cash margin for opening Letter of Credit (LC) while importing goods still exists, hampering imports. As a result, the government’s revenue collection, which is mainly dependent on customs duty, has been less than the target.
