Parliamentary panel raps defence ministry for underutilisation of funds
An action taken report on an older report of the Parliamentary Standing Committee on Defence, tabled in Parliament on Tuesday, said there has been underutilisation of Capital Budget in reference to the Budget Estimate, except the year 2016-17.india Updated: Dec 20, 2017 11:01 IST
A parliamentary panel on Tuesday rapped the defence ministry for underutilisation of funds, terming it indicative of inefficient budgetary planning.
An action taken report on an older report of the Parliamentary Standing Committee on Defence, tabled in Parliament on Tuesday, said there has been underutilisation of Capital Budget in reference to the Budget Estimate, except the year 2016-17.
The Committee, headed by BJP’s Maj Gen B.C. Khanduri (retd), said it had highlighted in its original report the “negative effect” of persistent trend of decreased allocation of funds, as compared to the projected amount meant for Capital Expenditure for the Services on several procurement proposals and contracts.
In 2017-18, against a projection of Rs 1,46,155 crore for Capital Budget, only Rs 86,528 crore has been allocated for the services - the army, navy, air force and others, it said, adding that capital allocation to the army in the budget estimate was Rs 25,254 crore against a projection of Rs 42,500 crore while the navy was given Rs 37,841 crore when the demand was Rs 51,065 crore.
Similarly, the air force was allocated Rs 59,672 crore against its projected requirement of Rs 92,496 crore for 2017-18.
According to the report, the Defence Ministry told the panel that each year, the funds allocated under the Budget Estimate have been reduced at Revised Estimate stage by the Finance Ministry.
“While the committee has always urged for suitable allocation of funds to the Service, they also wish to point out that underutilisation of funds with reference to Budget Estimates allocated (except in 2016-17) in indicative of inefficient budgetary planning by the Ministry of Defence,” the report said.
The Government should “take concrete measures to exercise prudent and effective budgetary planning”, it added.
The committee said fund crunch was impacting the three forces and it may even hit operational preparedness of the forces.
It also said that the Defence Ministry has passed the onus of underutilisation of funds to either cuts imposed by Finance Ministry, or delay in delivery of equipment, and “there appears to be no self-introspection by the Ministry of Defence in regard to underutilisation of funds”.
“The committee would like to reiterate that underutilisation of funds highlights the loopholes in the planning and budgetary exercise undertaken by the Ministry of Defence. Also persistent failure to utilise the allocated funds has contributed to reduction in Ministry’s budget allocations.”