CAG report highlights Kerala's negligible revenue growth and urgent need for spending reforms.
A Comptroller and Auditor General of India (CAG) report on Kerala's finances for 2024-25, tabled in the Assembly, highlighted that the State's economy (GSDP) grew by 9.97% but revenue receipts saw a "negligible growth" of 0.30% over 2023-24. This marked a decadal low in revenue receipts as a percentage of GSDP. The report noted that committed expenditure (salaries, pensions, interest payments) accounted for approximately 79% of revenue receipts, stressing an "urgent need for expenditure reform" to enhance fiscal flexibility. Another CAG report also criticized the practice of withdrawing funds from Treasury Savings Bank (TSB) accounts, including public contributions to the Chief Minister's Disaster Relief Fund (CMDRF).
Key Points
- Kerala's GSDP grew by 9.97% in 2024-25, but revenue receipts showed only 0.30% growth, a decadal low.
- Committed expenditure constituted about 79% of revenue receipts, indicating a need for urgent spending reforms.
- The CAG recommended improved targeting and prudent management of salary and pension commitments.
- The report also criticized the practice of withdrawing funds from Treasury Savings Bank (TSB) accounts.
Exam Facts
- CAG report on State Finances for 2024-25.
- Kerala's GSDP growth: 9.97% in 2024-25.
- Revenue receipts growth: 0.30% in 2024-25.
- Committed expenditure share: ~79% of revenue receipts.
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