CAG flags ₹4,564 crore misclassification in state’s CapEx | Bhubaneswar News
Bhubaneswar: The comptroller and auditor general (CAG) has uncovered a significant misclassification of revenue expenditure as capital expenditure in the state’s financial records for 2023-24, according to a report tabled in the assembly on Wednesday.
The audit revealed that of the total Rs 43,273.38 crore booked as capital expenditure, Rs 4,564.63 crore was actually revenue expenditure. This includes Rs 170.55 crore spent on operations, maintenance, and repairs, which should have been classified under revenue expenditure as per Government Accounting Rules, 1990.
The remaining Rs 4,394.08 crore, transferred for asset creation by non-government entities, was also incorrectly classified. This misclassification has led to an overstatement of the state’s revenue surplus, with the actual capital expenditure for FY 2023-24 being Rs 38,708.75 crore.
Despite this discrepancy, the state’s overall financial health shows positive trends. Revenue receipts increased by 19.36 per cent (Rs 29,131 crore) compared to the previous year, while the state’s own tax revenue grew by 16.91 per cent. The total expenditure rose to Rs 1,94,895 crore, marking a 17.04 per cent increase from FY 2022-23.
The five-year trend analysis shows capital expenditure growing from Rs 20,277 crore in FY 2019-20 to Rs 43,273 crore in FY 2023-24, maintaining a consistent 16-22 per cent share of total expenditure with an average annual growth rate of 20.87 per cent.
Capital expenditure is crucial for the state’s long-term development, funding infrastructure projects like roads, bridges, schools, and hospitals.
The state’s economy showed strong growth with GSDP reaching Rs 8.53 lakh crore in 2023-24, marking a 12.37% increase from the previous year. The GSDP has grown at 12.26% annually since 2019-20. The state posted a revenue surplus of Rs 30,761 crore, up by 58.11% from last year’s Rs 19,456 crore. Meanwhile, the fiscal deficit improved to Rs 14,743 crore, down by 3.13% from Rs 15,219 crore in 2022-23.
The audit revealed that of the total Rs 43,273.38 crore booked as capital expenditure, Rs 4,564.63 crore was actually revenue expenditure. This includes Rs 170.55 crore spent on operations, maintenance, and repairs, which should have been classified under revenue expenditure as per Government Accounting Rules, 1990.
The remaining Rs 4,394.08 crore, transferred for asset creation by non-government entities, was also incorrectly classified. This misclassification has led to an overstatement of the state’s revenue surplus, with the actual capital expenditure for FY 2023-24 being Rs 38,708.75 crore.
Despite this discrepancy, the state’s overall financial health shows positive trends. Revenue receipts increased by 19.36 per cent (Rs 29,131 crore) compared to the previous year, while the state’s own tax revenue grew by 16.91 per cent. The total expenditure rose to Rs 1,94,895 crore, marking a 17.04 per cent increase from FY 2022-23.
The five-year trend analysis shows capital expenditure growing from Rs 20,277 crore in FY 2019-20 to Rs 43,273 crore in FY 2023-24, maintaining a consistent 16-22 per cent share of total expenditure with an average annual growth rate of 20.87 per cent.
Capital expenditure is crucial for the state’s long-term development, funding infrastructure projects like roads, bridges, schools, and hospitals.
The state’s economy showed strong growth with GSDP reaching Rs 8.53 lakh crore in 2023-24, marking a 12.37% increase from the previous year. The GSDP has grown at 12.26% annually since 2019-20. The state posted a revenue surplus of Rs 30,761 crore, up by 58.11% from last year’s Rs 19,456 crore. Meanwhile, the fiscal deficit improved to Rs 14,743 crore, down by 3.13% from Rs 15,219 crore in 2022-23.
