Srinagar, Mar 19: The Jammu and Kashmir government on Wednesday said that it addressed the financial concerns raised in the CAG report.
In a written reply to a question raised by MLA Tariq Hameed Kara in the Legislative Assembly, the government said it has responded to the findings of the Comptroller and Auditor General (CAG) Finances Audit Report (No. 01 of 2023), which highlighted key financial concerns, including a revenue deficit of Rs 200.29 crore, a fiscal deficit of Rs 41.53 crore, and outstanding liabilities of Rs 29,335.41 crore.
The report, tabled in Parliament on March 28, 2023, also pointed out that Rs 5,092.25 crore remained unutilized across 123 schemes, despite pressing developmental needs, it said.
The government acknowledged the concerns while emphasising the positive financial developments in recent years. It said that revenue receipts in J&K grew by 13% in 2021-22, with own tax revenue increasing by 31.88%, State GST rising by 32.13%, and excise revenue growing by 32.31%. Non-tax revenue also saw an 18.74% increase, indicating improved efficiency in revenue collection.
The government also highlighted its efforts in financial management, maintaining a minimum cash balance for 62 days without borrowing. It asserted that despite fiscal challenges, J&K has managed to keep its deficit lower than expected while increasing capital expenditure by 5.51% in 2021-22. Investments in urban development, healthcare, road transport, education, and public infrastructure were among the key areas of focus.
Regarding the misclassification of Rs 158.76 crore in revenue expenditure under capital expenditure, the government admitted the error but clarified that it has been rectified in consultation with the Principal Accountant General (PAG). Similarly, the understatement of the revenue deficit (Rs 200.29 crore) and fiscal deficit (Rs 41.53 crore) was attributed to technical misclassifications, which have now been addressed.
The government further said that off-budget loans amounting to Rs 2,122.77 crore (JKIDFC) and Rs 10,321.83 crore (JKPCL) were taken to complete long-pending infrastructure projects and clear outstanding power purchase dues, particularly during the COVID-19 period.
It said these borrowings were necessary to maintain essential services and complete critical projects.
Addressing the issue of Rs 5,092.25 crore in unutilized funds, the government said that budget estimates are based on projections from various departments. Savings may arise due to factors such as vacant posts, lower operational expenses, or land acquisition delays. However, these unspent funds are reallocated to fast-moving projects to ensure their effective utilization.
The government also said that since September 2018, the Finance Department has been managing the Capital Expenditure (Capex) budget at the apex level. From 2019-20, digital platforms like BEAMS, PAYSYS, PROOF, and Treasury Net have been introduced to track resource allocation and expenditure in real-time to ensure greater transparency and accountability in financial management.
On the issue of accountability, the government said that in light of the explanations provided, no action against officials for financial mismanagement was deemed necessary.
