‘JK’s physical deficit in accordance with FRBM Act’

Jammu: A day after Principal Accountant General(PAG)  criticized Jammu and Kashmir government for not adhering to the FRBM Act and failing to curb state’s financial deficit, J&K Finance Department Sunday while defending its position on the issue said the ‘net outstanding debt is fully in accordance with the recommendations of the 13th Finance Commission’, which were subsequently incorporated in the J&K Financial Responsibility and Budget Management (FRBM) Act.
An official statement  said the methodology adopted by the Finance Department in calculating fiscal deficit is completely as per the set norms. However, the reports carried by the media do not give full picture to this extent and hence this clarification is necessary, it said.
The statement also said the House of Legislature and the Public Accounts Committee (PAC) shall be looking into the variations reported in the media in due course.
The Principal Accountant General (PAG) Audit, Subhash Chander Pandey while addressing a press conference here on Saturday had said “J&K’s own deficit is on a constant increase and the revenue deficit has not been brought down as required by the state’s FRBM Act.”
PAG was presenting the audit reports for 2012-13 and 2013-14 for the state in the press conference.
However, the Finance Department said the question of accumulation of debt liabilities for the posterity does not arise as reported in a section of the press
“In fact, state’s achievements have been slightly better than the corresponding year wise ceilings. The CAG’s report for the year under reference 2012-13, clearly shows that the net outstanding debt to GSDP ratio has been well below the prescribed limits,” the statement said.
The also said that there is no question of transferring the plan funds for the non plan items as every single item of plan expenditure is being monitored by the Planning Commission of India and plan funds are released in installments by the Ministry of Finance, Government of India on the verification of Planning Commission.
“Similarly, there is no question of over-borrowing because there are multiple checks on loans and open market borrowings of the state in the Planning Commission and the Union Finance Ministry which finally authorizes lifting of loans through the approved mechanism of Reserve Bank of India and the final check is exercised by the State’s House of Legislature keeping in view the ceilings prescribed under the J&K FRBM Act,” it said.