Finance Minister carrying out exercise to determine savings

NEW DELHI: Finance Minister P Chidambaram today said the Expenditure Department is carrying out an exercise to work out the quantum of savings by various ministries during the current financial year.

"The Department of Expenditure is sitting with ministries for revised estimates. It is only after the exercise is completed, we will know whether there is any savings in this," he told reporters here.

The Finance Ministry is working out revised estimates for the current fiscal. The revised estimates would be presented before Parliament during the Budget for 2013-14.

"I think you are using wrong word- spending cut. The correct word is savings," Chidambaram said.

The Finance Ministry, according to sources, has asked all central ministries to strictly adhere to the budgeted allocation as it would not be possible to provide additional funds because of tight fiscal situation.

At the time of revised estimates, various ministries come up with estimates of expenditures for the entire fiscal and furnish them to the Budget division in the Finance Ministry.

The Finance Ministry has already revised upwards the fiscal deficit target to 5.3 per cent of GDP, up from the 5.1 per cent as projected in Budget 2012-13.

Higher outgo on subsidies, lower rate of growth in tax revenues and poor off-take of disinvestment programme is adding to the fiscal woes of the Centre.

During the April-October period, gross direct tax collection rose by 6.59 per cent against the target of 15 per cent.

Further, with seven months of the fiscal already over, the government is yet to start its disinvestment programme, through which it aims to raise Rs 30,000 crore in 2012-13.