LGD still leads in ADP spending ahead of polls

The local government division (LGD) accounted for 21 percent of the total expenditure among 58 ministries and divisions in the first four months of the current fiscal year (FY) ahead of the upcoming national elections, scheduled to be held on January 7 next year.

In the July-October period of FY2023-24, the LGD spent Tk 6,792 crore, a 32 percent year-on-year increase, according to data from the Implementation Monitoring and Evaluation Division (IMED).

A majority of the top 15 ministries and divisions could not spend more than they did in the same period in the previous year under the annual development programme (ADP).

Since the start of the current fiscal year, the LGD has started to spend more.

Development spending in July, the first month of the fiscal year, was the highest in four years on the back of enthusiastic fund utilisation by the LGD.

The government's spending from its own purse rose in the first four months of the current fiscal year while the use of the funds from the foreign aid portion of the budget fell.

"The LGD's higher spending apparently reflects election-driven spending," said Prof Selim Raihan, executive director at the South Asian Network on Economic Modeling (Sanem).

But cautionary steps need to be taken to ensure quality of the project as this spending increases ahead of the election, he said.

Sometime, unnecessary or "show-off" projects may be implemented around this time, added Raihan.

Between July and October of 2023-24, about Tk 31,692 crore was spent under the ADP, which was 11.54 percent of the total allocation.

Of the sum, Tk 18,813 crore was spent from the government's coffers, up from Tk 18,190 crore in the same period of 2022-23.

On the other hand, expenditure from foreign funds during the period stood at Tk 11,864 crore, which was Tk 13,277 crore in the same period last fiscal year.

The power division spent Tk 3,541 crore, down from Tk 5,088 crore in the same period of the previous year.

Similarly, the bridges division spent Tk 1,674 crore in July-October period, down from Tk 3,321 crore.

On the other hand, the Ministry of Science and Technology spent Tk 1,333 crore, up from Tk 1,275 crore in the same period the previous year.