Ministries to get tailor-made expense plans

 Ministries have been asked to send in scheme-wise expenditure patterns and the finance ministry will impose a quarter- wise expenditure lid, depending on the nature of the scheme.

 While the ministry had earlier proposed to cap plan expenditure in the last quarter of each financial year to 33 per cent of total plan outlay for the year, it has now decided to alter the strategy.

 The move comes after a study of quarterly expenditure, undertaken by various ministries, has shown that variations get repeated in a similar fashion for a given ministry. Phasing of expenditure for each ministry should, therefore, be dictated by factors that are specific to the functioning of that ministry, it is felt.

 The cash management scheme, introduced in this financial year, aimed at eliminating the trend among ministries of bunching their expenditures at the end of the year instead of spacing it out across all the quarters.

 Almost 40-50 per cent of the total plan expenditure is bunched in Q4 of each financial year because ministries try to utilise their plan allocations within the financial year.

 However, the plan body, which is in charge of monitoring the plan outlays, has noted that while the power ministry and the railways spend almost 60 per cent of their plan outlay in the last quarter, the rural development and agriculture ministries concentrate expenditure in the first and last quarters of each financial year.

 If the spending pattern of the ministries in the last financial year is any indicator, only five out of 60 departments will qualify for spending their entire outlay, going by the finance ministry