The Comptroller and Auditor General of India (CAG) has expressed concern over the increasing liabilities of the State year on year claiming that about 97 per cent of the fiscal deficit was financed through market borrowings during the financial year 2019-20.
The CAG said the State could not achieve revenue surplus during 2019-20 for the first time in five years though other key fiscal targets prescribed by the State Fiscal Responsibility and Budget Management Act relating to fiscal deficit and ratio of total outstanding debt to GSDP were achieved. Although the outstanding liabilities were within the targets of the revised TSFRBM Act, these could be way above the targets if the liabilities of the government with regard to its off budget borrowings were taken into account.
The State Government had liability for off budget borrowings of ₹71,131.63 crore to the end of March 2020 (₹ 16,077.04 crore during 2019-20) taken by various entities on its behalf which it had not disclosed appropriately as part of its budget documents. “This has the impact of diluting public financial management and oversight role of the legislature and placing major sources of funding of government’s crucial socio-economic projects beyond the control of the legislature,” the CAG observed.
