June 18, 2022
Spending from the Annual Development Programme (ADP) is increasing exponentially towards the end of the financial year, with economists worried that quality will be compromised in the implementation of projects.
In the first 10 months to April of the current fiscal year, the Health Services Division spent just 39.75% of the ADP allocation, while spending by the division rose to 75.12% at the end of May.
As such, the Health Services Division’s spending stood at 35.37% of its ADP allocation in May alone.
This division spent around Tk3,533 crore in May compared to Tk3,970.42 crore in the previous 10 months, according to an updated report of the Implementation Monitoring and Evaluation Division (IMED).
Officials at the Health Services Division said the ADP implementation rate has increased due to the payment of bills for several development works in May.
Among the top allocation recipient ministries and departments, the Ministry of Civil Aviation and Tourism spent 18% of its allocation in May alone. The 10-month ADP implementation rate of this ministry was 43.76%.
The shipping ministry has spent 31.88% of the allocation in the nine months to March of the current financial year.
In May, the ministry’s spending increased to 53.54%. The ministry expects the ADP implementation rate to exceed 90% by the end of June. The agriculture ministry spent 16% of the money in May.
State Minister for Planning Shamsul Alam thinks that spending from the ADP has increased due to a rising pace of development projects at the end of the financial year.
Ahsan H Mansur, executive director of the Policy Research Institute of Bangladesh, said, “If the money allocated for the financial year cannot be spent, it gets refunded. In this consideration, contractors are paid their bills in advance. In this way, ADP implementation rate is shown to be higher.”
“In our country, contractors are paid in advance as there is no opportunity for rollover in the next financial year. Moreover, in the first few months of the new financial year, money is not spent on development projects. The month of July passes in completing various processes, such as releasing funds,” he added.
The noted economist believes if there is an opportunity to roll over the allocation, it is possible to spend money from the beginning of the financial year.
Mustafa K Mujeri, former director general of the Bangladesh Institute of Development Studies (BIDS), said, “In our country, ADP money is not spent at the beginning of the financial year. But in the last two or three months of the financial year, more than half of the allocation is spent.”
“At this time, quality implementation of projects is not possible due to the state of hurry. It leads to a waste of government money,” he added.
Meanwhile, according to IMED, 29 ministries and departments could not spend as much as 60% of the money allocated to them in 11 months of the financial year.
These include the primary and mass education ministry, the secondary and higher education directorate, the bridges division, the housing and public works ministry and other large ministries and departments.
These ministries and departments are faced with the challenge of spending 40% of their allocations in just one month, in June. People concerned expect that at least 30% of ADP implementation will take place in the running month.
Annual Development Programme (ADP)
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ADP spending jumps in May, sparking fears over quality – The Business Standard