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Cash-strapped State restricts non-plan expenditure

SHILLONG: The State Government has decided to curtail non-plan expenditure in all departments due to financial constraints.
Non-plan expenditure includes maintenance works and purchase of vehicles, among others.
The Finance Department in a circular issued to the heads of all departments recently said, “Due to fund constraints under non-plan during the current financial year (2016-17), it has become imperative to impose restriction on avoidable and unproductive expenditure to allow the Finance Department to manage the finances of the State in such a manner so as to be able to meet the committed liabilities of the State such as salaries, pension, interest payment and others.”
According to the letter, it has been decided to immediately bar all non-plan expenditure related to furnishing of offices, quarters and other buildings, maintenance and repairs of office buildings and quarters and purchase of spare parts and repair of vehicles.
The departments have been advised not to incur liabilities in anticipation of carrying over actual payment to the next financial year.
According to sources, the State Government was compelled to resort to these austerity measures in view of financial losses incurred after the ban on coal mining, limestone and restrictions imposed on the sale of liquor.
For the last three years, the loss incurred due to ban on rat-hole mining is estimated at Rs 1,800 crore considering the rough calculation of loss of Rs 600 per year.
However, sources pointed out that beyond the ban on coal mining, the State Government had incurred additional expenditure due to the creation of four new districts in 2013.
There will be additional financial burden for the creation of four new civil sub-divisions, six community and rural development blocks and 18 police stations as announced in last year’s budget.
Adding to the financial constraints will be the committed liability of increasing the pay, pension and other allowances as per the Fifth Pay Commission, which is likely to submit its report in July this year.

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