State capital expenditure on education, sports fell consistently in FY20-23: CAG

The Punjab Government’s capital expenditure (CapEx) on education, sports and art and culture saw a consistent decline from the financial year 2019-20 to 2022-23, a report by the Comptroller and Auditor General of India (CAG) has revealed.

The report, State Finances 2022-23, Decadal Analysis, says that the capital expenditure in the three areas fell consistently from Rs 227 crore in 2019-20 to Rs 183 crore in 2022-23. It was Rs 200 crore in 2020-21 and Rs 196 crore in 2021-22. In a decade, the highest CapEx of Rs 357 crore was made during the fiscal 2013-14.

According to CAG, the combined data of all states showed a consistent increase in capital expenditure in education, sports, art and culture from Rs 6,842 crore in 2013-14 to Rs 24,467 crore in 2022-23.

The capital expenditure refers to the funds a government spends to acquire or build long-term physical assets or to invest in projects that provide future benefits such as economic growth or repayment of its debts. Capital expenditure on education, sports and art and culture involves spending on fixed assets such as constructing new schools, libraries, sports complexes, museums, acquiring educational equipment, and investing in research facilities or significant infrastructure for artistic endeavours.

The CAG report also highlighted that Punjab’s debt to gross state domestic product (GSDP) ratio in 2022-23 exceeded the indicative ceiling of the 15th Finance Commission for fiscal health. Punjab’s debt as on March 2023 was 40.35% of the GSDP, highest among all states. While the GSDP stood at Rs 6.85 lakh crore, the debt was Rs 2.76 lakh crore. The total liability of the state was 45.86% of the GSDP, much higher than the combined liability of all states, which was 28%, the CAG report underlined. The high debt ratio indicated a precarious financial health of the agrarian state.