THE exhaustion of the contingency fund in less than five months, that too, just to meet additional fund demands made by different ministries and divisions ahead of the general elections scheduled to be held on January 5 does not bode well for the economy. Moreover, it may cause the government to face severe problems if there is any situation requiring emergency fund in the months to come. According to a New Age report on Sunday, of around Tk 2,500 crore set aside by the government in Budget 2013-14 as contingency fund and block allocation, Tk 1,300 crore has been spent to meet additional demands from ministries and divisions, while the remaining Tk 1,200 crore was spent by October to fund projects taken mostly on partisan considerations of the incumbents and to pay dearness allowance, risk allowance for the members of the law enforcement agencies and utility bills of the armed forces. Moreover, the demands for additional funds are still being made by different government agencies. Just last week, for instance, the minister for local government and rural development and cooperatives demanded Tk 200 crore to pay compensation for the land acquisition for the proposed water treatment plant at Mawa.
What is more worrisome is that, in a bid to cope with the situation, the government has already borrowed more than Tk 9,500 crore from different commercial banks in the first three months of the current fiscal year. Besides, such borrowings looks set to increase further in the days to come as the revenue collection is likely to lag behind the target by between Tk 10,000 crore and Tk 13,000 crore because of the ongoing political unrest in particular. Needless to say, if it really occurs, as has been seen in 2011-12 in particular, it will affect the economy in various ways. In 2011-12, with the introduction of the dubious rental and quick rental power plants, most of which run on expensive diesel and furnace oil, by the government in the name of quick solution to the nagging power cuts, import bills for fuel oils and state subsidies for the power and energy sector literally skyrocketed. Meanwhile, to meet the extra expenses, the incumbents have had to make excessive borrowing from the banking sector. As a result, the overall inflation underwent a staggering rise causing adverse impact on the cost of everyday life of people at large while disbursement of loans to the private sector saw a huge fall affecting badly the overall investment scenario directly related to economic growth in general and employment generation in particular.
As experiences have shown, like their predecessors, the incumbents standing at the fag-end of their tenure may not stop doling out public money to their own people unless pressured to do so. Hence, the conscious sections need to come forward mounting pressure on them to stop such actions and protect people from sufferings due to an imperilled economy.
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