Need for better budget execution

The fact that budget execution rate in Bangladesh is one of the lowest in South Asia is a malady that over the decades has shown no sign of improvement. So far as the two major components --- revenue collection and ADP implementation--- of the national budget are concerned, shortfall in one and a chronic delay and deferment in the other clearly demonstrate the gap between policy objective and actual performance. Since the government functionaries are tasked with the responsibility of accomplishing the jobs, they ought to take the responsibility of not rising up to the task. Although there are other factors that in one way or other account for the sloth and failure, it is generally believed that a lack of accountability of the civil servants and inefficient governance are the major reasons behind low budget implementation.
An FE analysis has found government's budget expenditure hovering around 81 per cent to 85 per cent of the outlay in the last one decade. Quoting ministry of finance data, the analysis states that budget execution rate has been far less than the target since the fiscal 2015-16. In the last fiscal 2023, the government spent Tk 5.758 trillion or 84.93 per cent of the total Tk 6.78-trillion of original allocation. The government investment is about 15 per cent of the country's GDP, on an average, in public expenditure per annum, the analysis says. In the current FY2024, the government has taken a target to spend 15.2 per cent of the GDP on the country's development works. In the last fiscal, the public expenditure in the country was 14.9 per cent of the GDP, while it was 13.1 per cent in FY2022, 13 per cent each in 2021 and FY2020, 13.3 per cent in FY2019, 12.2 per cent in FY2018 and 11.6 per cent in FY2017.
While fulfilling the revenue collection target has always remained far out of reach, implementing the development programmes under the ADP reasonably efficiently is utterly missing. The result is often a botched-up implementation affair reflecting the overall poor execution of numerous projects. Basking in the glory of a fat ADP thus appears to be self-deceiving for the planners. That the matter is fast gaining ground in the country's public spending culture has been flagged time and again.
Besides the less than efficient bureaucracy, often held responsible for valid reasons, it is the selection of projects and methodology adopted that are also found to constrain budget execution. Experts have pointed out the need for a sound mechanism to be worked out by a set of knowledgeable professionals in order to identify projects consistent with national priorities. A lack of adequate economic analysis, funding strategies, abundance of unapproved projects, absence of sufficient coordination between development and non-development budgets, shortage of expert manpower and weak capacity of the Planning Commission and Planning Cells in the ministries are often regarded as some of the major obstacles to establishing an efficient public spending management system in the country. Given the uninspiring environment, one hopes that the inter-ministerial coordination will be streamlined for facilitating budget execution.