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4 August, 2020 06:58:29 PM / LAST MODIFIED: 4 August, 2020 07:00:45 PM
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Execution of budget: Ways to increase capacity

Public offices need to ensure effective system of internal control and pre-audit mechanism because it is one of the several factors that influence the performance of an organization and it plays a vital role in achieving management intended objectives
Dr. Md. Shamsul Arefin
Execution of budget: Ways to increase capacity

Budget implementation process ensures proper control of limited resources to achieve intended government policies and priorities in a transparent and effective way. As we all know that accountability, transparency and role of oversight agencies are keys to effective budget implementation. 
The budget execution stage is when funds are actually spent to implement the policies, programmes, and projects outlined in the enacted budget. The ministry of finance exercises central supervision over spending and line ministries, departments have autonomy over managing their budgets as well. Departments also assess the quality of the spending to see if the policy goals associated with the budget allocation are being met. 
E-procurement can help not only the ministry gain effective control over their finances, but also enhance transparency and accountability, reducing misuse of fund and acting as a deterrent to corruption and fraud. 
Public offices need to ensure effective system of internal control and pre-audit mechanism because it is one of the several factors that influence the performance of an organization and it plays a vital role in achieving management intended objectives that would lead to the successful implementation of budget. 
Performance in revenue collection on budget implementation is very critical area for anywhere in the world. Optimal revenue collection is still structurally and operationally compromised by loopholes such as lack of automated machine recorded transaction system in revenue collection.
An efficient revenue collection system is the pivot of revenue administration and the cornerstone of sound fiscal management. It enables governments to finance budget deficits more from domestic sources.  On the other hand, effective oversight and audit authority ensures transparent expenditure and protects the public funds and citizens’ interest. For successful budget implementation, there is no alternative to train and monitor officers continuously. 
This year (2020-2021) Tk.568,000 crore budget with the slogan of 'Economic Transition and Pathway to Progress’ has brought hope to the citizens of getting momentum in economy. The government set the target of total revenue income at 3,78,000 crore takas. Out of this, 3,30,000 crore takas will be collected through the NBR. 
At the time of preparation of budget, it has the previous experiences and observation and a time tested procedure. But effective execution of budget is a real challenge everywhere in the world because of low capacity of the implementation stage. Low capacity remains in regard to high volume of budget compared to previous year. Budget increases every year but capacity to effective use of public money remains unchanged due to lack of capacity building initiatives of public officials with increased expenditure.  Suppose 10 years back, one upazila engineer needed to spend 1 crore taka whereas now he/she needs to spent more than 10 crore taka in one year. But capacity of the officer remains unchanged. 
Building capacity of spending budget depends on efficiency of implementing officers those who are deeply associated with public spending. Executives need to respect and acknowledge the standard of financial propriety to implement budget. The core value of the standard of financial propriety explains that every officer is expected to exercise the same vigilance in respect of expenditure incurred from public money as a person of ordinary prudence would exercise in respect of expenditure of his own money. Therefore, officers need a very high standard of mindset to spending public money with self-care and personal attention.  
Direct commodity transfer through subsidy programme or any food distribution programme now-a-days, is not considered as an effective way of disbursement (except famine period) because it distorts open market system and at the same time things like hording, black marketing, pilferages generates. Therefore, the best way is to provide price difference /gap money to their bank account. Suppose rice programme price is Tk 10 and programme quantity per month per family 30 kg. If the market price is taka 40 a kg, then gap money is 1200- 3,00/=900/ taka can be given to the account of beneficiary so that he/she can buy it from open market. This practice is being followed in most of the developing countries. But we have problems in regard to bank accounts of beneficiaries. Now agent banking of NCBs/private banks may come forward to address this issue in rural areas. It is possible as we have seen a Bkash account can be opened by NID within a moment.
Most of the central procurements including medical equipment for hospital, books and other procurement for educational institutions can be delegated to the district/upazila level or even concerned offices/institutions level so that they can buy at their level maintaining high transparency and accountability raised from the beneficiary directly. Central authority may monitor procurement process. Extension of implementation time of running project/programme increases huge extra expenditure. Time extension approach (that created by contractors side) normally needs to be completely barred by insertion a section in the budget management act, 2009 and procurement act. In case of national big projects, time extension provision (that government, procuring entity needs) may remain in law. New or very unusual proposal for additional funding to the ministry of finance by different agencies (if budget management committee thinks it fit) may be placed before the standing committee constituted by the parliament. Delivery mechanisms for social safety net programme needs more effective channel like G2P. Budgetary provision can influence savings culture of a society. Attractive rate of interest can be offered to savings instruments designed for the low income group of people like garments worker and poor remittance senders. These budgetary contributions as interest paid to marginal savers can also be calculated as figures in social safety net programme. Attractive interest rate for very small depositors is one of the most effective ways of social safety net programme. Because this programme inspires savings culture of a society and at the same time protects their financial hardship and saves them from receiving high interest bearing loan from rural moneylenders.  
However, job seekers may be made hopeful during execution of budget. Some developing countries forecast number of new employments for new job seekers in their budget means certain numbers of youth will get new jobs. Projection of youth employment in budget and its expression inspires young people to be hopeful like business people, traders and commerce men. Again the main group of people who are engaged in agriculture in our country context may need to vividly understand that this execution of budget creates hope for them as well. Rural programmes may be designed in such a way that it may give direct benefit to individual or a small group of people like club, society, association, cooperatives, etc. Each and every individual or small group of people in agriculture need to understand that he/she is getting some benefits from this budget. Getting a sense of direct benefit encourages self-involvement and engagement of an individual which can ensure better and efficient public spending in a developing country like Bangladesh.  
However, expanding tax net is more effective than increasing the tax rate. We have no formal tax collection framework at upazila level. Thus searching new tax payer by arranging tax fair in sub-district level can be a good option. Officially acknowledged watch dog platforms with high reputation may be engaged who may assist under specific TOR the government offices for transparent and effective expenditure and revenue earnings in each districts. 
Due to general holidays, lockdowns, closure of factories and businesses to prevent the spread of coronavirus infections, income of the marginal people, daily bread earners has reduced, which now threatens the achievements in poverty alleviation and social security. In order to overcome the crisis, government led by the Prime Minister Sheikh Hasina relentlessly has been working to accelerate various programmes designed for the marginal people who lost their income. Now training of officers, awareness programmes and effective monitoring at each level are important for proper implementation of budget.

 

 

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Published by the Editor on behalf of Independent Publications Limited at Media Printers, 446/H, Tejgaon I/A, Dhaka-1215.
Editorial, News & Commercial Offices : Beximco Media Complex, 149-150 Tejgaon I/A, Dhaka-1208, Bangladesh. GPO Box No. 934, Dhaka-1000.

Editor : M. Shamsur Rahman
Published by the Editor on behalf of Independent Publications Limited at Media Printers, 446/H, Tejgaon I/A, Dhaka-1215.
Editorial, News & Commercial Offices : Beximco Media Complex, 149-150 Tejgaon I/A, Dhaka-1208, Bangladesh. GPO Box No. 934, Dhaka-1000.

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