ADP implementation 23.89% in H1 of FY21

All the ministries and divisions implemented 23.89% of the Annual Development Programme (ADP) during the first half of the current fiscal year and the rate was the lowest in the last five years, according to a report.

The Implementation Monitoring and Evaluation Division (IMED) report published on Wednesday revealed that all the implementing agencies of the government spent Tk51,266 crore in July-December, which was Tk57,196 crore in the same period of the previous fiscal year.

ADP spending in the first half of this fiscal year fell by 10.37% compared to the same period of the previous financial year.

The National Economic Council (NEC) approved ADP of Tk214,611 crore for fiscal year 2020-21.

To reach implementation target, the ministries and divisions now have to spend Tk163,345 crore in the second half, about 3.19 times higher than the expenditure during the first half.

Dr Fahmida Khatun, executive director of the Centre for Policy Dialogue (CPD), told The Business Standard creating purchasing power by increasing government spending is a popular and effective approach worldwide to recover from any kind of economic crisis.

"The government underutilised the scope of accelerating recovery by reducing the ADP expenditure," she said, adding that about 80% of the ADP spending goes to construction, which can create lots of jobs.

The economist said development spending had decreased as economic activities remained limited due to the Covid-19 pandemic and the government had failed to generate revenue earnings.

She added, "Bangladesh is facing a perennial problem in the field of development by delaying activities in the first three quarters and then disbursing a large amount of money in the last quarter."

"Hurry at crunch time is a major challenge to ensure proper work quality and the best value of money."

The IMED report showed ADP implementation of 22 ministries was below 20% after six months of the current fiscal year.

Seven ministries and divisions – public administration ministry, Internal Resources Division, Financial Institutions Division, commerce ministry, information ministry, defence ministry, and Public Security Division – failed to spend even 10% of their allocations.

IMED Secretary Pradip Ranjan Chakraborty told The Business Standard the religious affairs ministry had implemented 72% of the ADP, the highest, while the Internal Resources Division registered the lowest implementation, only 1.75%.

He said the implementation rates of some ministries and divisions were lower than the expected level, which had hampered the overall implementation rate.

"I am contacting the secretaries who failed to implement ADP and trying to understand their problems. Some divisions are facing legal problems, but they are committed to solving those," Pradip added.

The Power Division recorded the highest aDP expenditure of Tk9,466 crore, which was 34.68% of its allocation, to implement 91 projects.

The Local Government Division, which got the highest allocation of Tk30,365 crore, spent Tk7,432 crore and its implementation rate was 24.48%.

The Bridges Division, which was among those securing the highest allocations, implemented 19.8% of the ADP. It spent Tk1,581 crore out of its Tk7,987 crore allocation.

The Health Services Division implemented 14.63% of the ADP allocation.

ADP implementation was 26.59% during the first half of fiscal year 2019-20. In the previous three fiscal years, implementation rate was above 27%.