Ministries incur Rs 8,563 cr excess expenditure: Parl panel

Asking Finance Ministry to devise stringent measures including penal action to check excess spending, a Parliamentary panel today said various ministries had incurred excess expenditure of Rs 8,563 crore in 2011-12.
Public Accounts Committee's (PAC) report on 'Excesses Over Voted Grants and Charged Appropriations (2011-12)' was tabled in Parliament today.
The report said the examination of the four Appropriation Accounts relating to Civil Services, Defence Services, Postal Services and Railways for 2011-12 revealed that excess expenditure of Rs 8,563.14 crore was incurred in 14 cases of 11 grants by various Ministries/Departments during the year.
The excess expenditure during the previous fiscal 2010-11 was at Rs 11,046.93 crore.

"The Ministry of Finance should impress upon all the departmental heads concerned to strictly observe the instructions issued under the financial rules so as to ensure that no expenditure is incurred in excess of the authorised limits," said the report.
It should also device "some effective and stringent measures including penal measures against the responsible financial advisors and the budget controlling authorities in all the ministries/department to overcome the recurring phenomenon of excess expenditure in future," it added.

It said the Committee was astonished to find that bulk of the excess expenditure had been recorded under defence pensions (Rs 3,563.10 crore) operated by the Defence Ministry and interest payments (Rs 2,947.58 crore) operated by Finance Ministry.

Expenses under these two heads accounted for over 76.10 per cent of the total excess expenditure.
"Examination of the excess expenditure incurred during the last five years may also be conducted by the Ministry of Finance," it said.
PAC also observed that excess expenditure was incurred despite huge amount of supplementary grants, excess expenditure of more than 5 per cent of the budgeted provision and misclassification of excess expenditure by Railways.
PAC, chaired by senior Congress leader K V Thomas, suggested that the Defence Ministry take effective measures to precisely anticipate and assess the actual requirement of funds at various stages of budgeting process.

The Ministry of Railways should look into the recurrent
lapses on incurring excess expenditure, with a view to fixing responsibility at the appropriate level, it said.
"...The Committee feel that extant system of monitoring of expenditure in the Ministry is awfully deficient and there is a utter failure on part of the Zonal Railways in maintaining financial discipline."
The report also found that the incurring of excess expenditure was a recurring phenomenon in all these sectors.
It suggested that the Finance Ministry conduct a study of the best international practices to ensure greater conformity of expenditure to the budgetary provisions.

"The Committee are inclined to conclude that no corrective measures in accordance with the Committee's recommendations have been taken by the Ministry of Finance," it said.
Further, it added, the Committee are also constrained to point out that instead of taking the action as desired by them, the Ministry of Finance have furnished routine replies.