Maharashtra imposes cap on spending

The cash-strapped Maharashtra administration has imposed a 50 per cent ceiling on plan and non-plan expenditure as well as a 60 per cent cap on maintenance expenditure for the rest of the current financial year.

In a directive issued to all departments on October 14, 2004 the finance department stated: "The resources available with the state government are limited. Moreover, there is a sharp mismatch between this available resource and the expenditure...

Apart from salaries, allowances, wages, pension, natural calamities, interest and principal repayments, surgical equipment, food expenses, medical procurements for state hospitals, milk procurement expenses and testing costs, all planned expenditure will be capped at 50 per cent."

While the state government will continue to provide its share of funds for Centrally-aided projects, internationally-aided schemes and the employment guarantee schemes, the state's planned expenditure has been curtailed by 50 per cent.