‘Government has not followed the targets set out in the AP Fiscal Responsibility and Budget Management Act’
‘Government has not followed the targets set out in the AP Fiscal Responsibility and Budget Management Act’
The Comptroller and Auditor General (CAG) of India in its State Finance Audit Report for the financial year 2020-21 said that the state government had off-budget borrowing liability of Rs 86,260 crore, which was not properly disclosed. . Its budget document.
The result was a weakening of public financial management and oversight of the legislature, and keeping the government’s major sources of funding for critical infrastructure projects beyond the legislature’s control.
Outstanding public debt at the end of 2020-21 increased by 15.39% (₹46,444 crore) over the previous year.
revenue receipts
The CAG noted that the state witnessed an increase of 5.50% in revenue receipts during the year due to increase in transfers from the Government of India (GoI).
The state received a compensation of ₹5,838 crore for the revenue loss incurred in the implementation of the Goods and Services Tax (GST), partly in the form of grants amounting to ₹3,527 crore and the rest in the form of back-to-back loans to India. government.
The CAG said the obligation to repay the loan was not on the state’s resources as the repayment of the loan would be done through collection of cess in the GST Compensation Fund.
It was further stated by the CAG that the State Government had not adhered to the targets prescribed in the AP Fiscal Responsibility and Budget Management Act with respect to fiscal deficit and outstanding liabilities.
The CAG also observed that a major part of the borrowings during the year 2020-21 was used to balance the revenue account, which affected wealth creation in the state.