Gandhinagar, 25 July 2014

Government of Gujarat presented the Comptroller Auditor General’s report on the state government’s performance for 2012-13 in the state Assembly today.

Five reports – on State Finances, Revenue Sector, Public Sector Undertaking, Economic Sector and General & Social Sector were tabled in the Gujarat state assembly today.

It is to be noted that an audit report, which generally scrutinizes performance of governments, lauded the state government’s performance during the period 2012-13. CAG has appreciated the efficient and result-oriented financial management of Gujarat and better functioning of the State’s Public Sector Undertakings in its report.

CAG’s observation on Financial Management:

In its report the CAG has mentioned that the State’s tax revenue has increased by 128.9% during the years 2008-09 to 2012-13. Besides the state’s own tax revenue receipt has also increased by 19.49% over the previous year. The State has achieved all the fiscal targets well within the prescribed limits as per the recommendations of the 13th Finance Commission. Against the target of containing Fiscal deficit at 3% of GSDP, the state has successfully maintained it at 2.37%.

The CAG report notes that:

•The total revenue receipt of the Government of Gujarat in 2012-13 has increased to 75,228.53 crores from 62,958.99 crores during 2011-12. State’s Revenue receipt grew by 19.49 % over previous year and increased steadily from 2008-09. State’s tax revenue has increased by 128.79 % from 2008-09.

•The percentage of Tax receipts to revenue receipts increased significantly from 60.91% in 2008-09 to 71.64% in 2012-13. Total Revenue Expenditure grew by 16.59% over previous year; the growth of revenue expenditure during current year was mainly on account of 34.27% growth in Plan revenue expenditure.

•The development expenditure increased from 35,612 crores in 2008-09 to 66,177 crores in 2012-13. The percentage of development capital expenditure to the aggregate expenditure during the current year(2012-13) was 22.35 % whereas the revenue expenditure component was 49.44 %.

•At the end of 2012-13, the fiscal deficit as percentage to GSDP was 2.37, which was within the limit of 3%.

•The total resources of the State Government increased steadily from 51,525 crores in 2008-09 to 98,281 crores in 2012-13. The increase in total resources during the period of 2008-09 to 2012-13 was 90.74 %.

•The State’s tax revenue increased by 128.79 % from 23,557 crores in 2008-09 to 53,897 crores in 2012-13.

•The percentage of tax receipts to revenue receipts increased significantly from 60.91 % in 2008-09 to 71.64 % in 2012-13.

•The Capital expenditure during 2012-13 has been increased significantly by 53.69 % over the previous year. Major Irrigation, Urban Development, Minor Irrigation and Roads & Bridges have shown sharp increase.

•The State had a revenue deficit during the period 2008-11 which turned into a revenue surplus during 2011-12 and 2012-13. During 2012-13, the State had a revenue surplus of 5,570 crores, an increase of 2,355 crores over previous year. This has happened due to successfully containing revenue expenditure and kept it close to Budget Estimates while significant improvement in revenue receipts was achieved due to better tax compliance.

•Fiscal deficit and primary deficit have been contained at a level lower than budgeted estimates.

•The State has amended Fiscal Responsibility legislation in line with the 13th Finance Commission recommendations and achieved all the targets well within the targeted limits. viz. eliminated Revenue Deficit and achieved revenue surplus of Rs.5570 Crores , contained Fiscal deficit at 2.37% of GSDP, within the limit of 3% of GSDP and contained public debt as 20.35% of GSDP against 27.1% of GSDP as given in the Medium Term Fiscal Policy Statement.

CAG’s observation on effective recoveries of Value Added Tax Receipts: The Report also mentions the effective recoveries of VAT receipts by the state government.

•The contribution of the Value Added Tax receipt in the total tax revenue of the State for the year 2012-13 is 73.22%. Gross receipt of the Commercial Tax Department (VAT) for the year 2012-13 is of Rs.41863.63 Crores which is 26.26% higher than the receipt of the previous year.

•Pending Assessment Cases in the beginning of the year 2007-08 was 7,28,402 which has been reduced to 97,196 at the end of the year 2012-13. This indicates considerable reduction in the assessment pendency.

•Cost of Collection
Year Cost of collection of the State (in %) Average Cost of collection
of the Nation (in %)
2008-09 0.59 0.83
2009-10 0.71 0.88
2010-11 0.60 0.96
2011-12 0.52 0.75
2012-13 0.38 0.83

Thus, the cost of collection in Gujarat State is considerably low as compared to the National average. In addition, there is reduction in the cost of collection in comparison to the previous years.

CAG’s Observations on Achievement of State Public Sector Undertakings The Report highlights the extraordinary achievements in the State Public Sector Undertakings.

•As on 31 March 2013, the State of Gujarat had 69 working PSUs (65 companies and four Statutory Corporations).
•The working PSUs registered a turnover of 91,309.63 crores during 2012-13 that was equal to 13.09 % of State GDP.

•The working PSUs earned an overall aggregate profit of 4,041.06 crores.

•As on 31 March 2013, the investment (capital and long-term loans) in 81 PSUs was 97.472.56 crores. It grew by 91.90 %. The thrust of PSU investment was mainly in power sector.

•During the year 2012-13, out of 69 working PSUs, 42 PSUs earned profit of 4,468 crores.