Dev spending slumps to seven-year low
FE REPORT | Tuesday, 19 December 2023
The government's development-programme-implementation rate has hit a seven-year low, with only 17.06 per cent of the budget spent in the first five months of the current fiscal year.
This sluggish pace is attributed to both government austerity measures and the upcoming national election, officials said on Monday.
Previously, the lowest July-November development-spending rate was recorded in 2016, when government agencies managed only 16.84 per cent.
While the rate remained higher than this point for the past six years, it has now dipped drastically to 17.06 per cent, according to data from the Implementation Monitoring and Evaluation Division (IMED).
According to the IMED, ministries and agencies spent Tk 468.57 billion during the five-month period, which represents 17.06 per cent of the total Tk 2.74-trillion allocated for the Annual Development Programme (ADP) in FY2023-24.
IMED officials pointed to the government's belt-tightening measures and the upcoming national election as key reasons for the slow pace of project execution.
Besides, the massive fall in spending by the shipping ministry, secondary and higher education division, health ministry and roads and highways division further contributed to the poor ADP implementation, they said.
Analysts and Planning Commission officials say that despite an economic turnaround from the Covid shock in 2022, government agencies failed to regain their full capacity for an efficient ADP execution.
Government agencies spent Tk 2.65 billion less during July-November of FY24 compared to the same period in the previous fiscal year, despite the ADP size increasing by Tk 186.71 billion.
In FY23, public agencies spent Tk 471.22 billion, translating to 18.41 per cent of the total Tk 2.56 trillion ADP allocation, IMED data showed.
The IMED data also shows performance disparities among ministries. During the July-November period of FY24, the shipping ministry utilised only 6.66 per cent of its ADP allocation, while the secondary and higher education division managed 9.85 per cent, the health ministry 10.64 per cent and the roads and highways division 12.09 per cent.
In contrast, the civil aviation and tourism ministry, railway ministry, agriculture ministry and Local Government Division fared better during this period.
The government has taken a Tk 2.74 trillion ADP for the current fiscal year to implement more than 1,392 development projects.