Chhattisgarh has registered appreciable growth in budgetary resources over the last decade as per the latest report released (May 2018)
The Government has already initiated several reforms to improve management of public finance and strengthen the DBT system. The e-Governance reforms are being rolled out to streamline treasury functions and improve expenditure controls at State level and at the level of local bodies. The State has largely addressed the compliance aspects of the FRBM Act, it mentioned.
The Government now intends to focus on the next generation reforms including automation and integration of processes with the objective of achieving “paperless” and “cashless” systems.
The operation will help address the staffing constraints which limit Government's ability to undertake the complete design and roll-out of all the key components of the reform strategy, the report mentioned.
In order to support reforms where institutional capacity is limited and special skills are required, the project will include a technical assistance component that will allow the Government to acquire consulting services, it stated.
The total resources – own revenues, loans, transfers and advances from Central government grew from Rs 9,241 crore in 2005-06 to Rs 54,667 crore in the year 2015-16, increasing by eighty percent in the five-year period 2011-2016.
The State’s Revenue Receipts (RR) contributing approximately 50 percent of total resources, with the remaining 50 percent coming from the Central Government, the report mentioned.
Revenue from GST in Chhattisgarh (along with state VAT) in FY 17-18 have improved slightly, by about 5 percent compared to the tax collection from state VAT before its introduction in FY 16-17, the report mentioned. But it is difficult to say whether this improvement is due to improvement in collection from GST or from the inclusion of cess for GST compensation. The State will be compensated for loss if any, in tax revenue up to FY 21-22.
Chhattisgarh is largely compliant with fiscal responsibility targets as laid down in the Chhattisgarh Fiscal Responsibility and Budget Management (FRBM) Act, it mentioned.
And last but not the least a unified social registry platform needs to be established to improve the performance of social programs. Recognising these challenges, the State Government has identified Public Financial Management (PFM) strengthening and modernization as a reform priority using IT as the key driver.
The State Government wants to further extend its PFM reform initiatives and has sought support from the World Bank in strengthening expenditure management including direct benefit transfers, tax administration systems and building capacity of its human resources and institutions handling management of public finances, the report mentioned.