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Committee formed to identify causes of public account deficit

  • Published at 06:46 pm January 21st, 2014

The government has formed a six-member committee to find causes of deficit in the public account in the beginning of every fiscal year.

Such mismatch in cash and debt accounts of the republic might be a reason of pension money crisis in the start of a year, officials suggested.

Finance Division issued a circular yesterday stating the formation of the committee.

An official said although the country’s cash and debt management showed Tk600 crore surplus in December last year, the situation might worsen in next couple months due to fallout of the prolonged political turmoil.

He said investment has dropped because of the unrest, which may start casting a negative impact on the cash and debt situation. 

However, in January 2013, there was Tk1,000crore deficit in the cash and debt management, added the official.

Finance Division sources said sometimes the government’s withdrawal of money from the national pension fund causes crisis while distributing money among the receivers.

“The government, for example, spends Tk2000 crore from the pension fund, but it doesn’t repay the amount to the respective bank, which later leads to the problem,” said an official.

Such fund is available in Bangladesh Bank or the state-owned Sonali Bank.

The transfer of guarantee money of a project to another project in the hope of profit is also responsible for the account crisis, the officials think.

Besides, the local administrations’ people also sometimes shift fund money of development projects to their own private accounts for making bank interest.

The officials said such practice is also responsible for the shortage of fund during the beginning of a year.

Last fiscal year, International Monetary Fund advised the finance division to keep the public account updated.

Usually, a government fund transfer requires a two-month time.

In the FY2013-14, the public account shows Tk33,796.50 crore receipt and TK 25,825.50 crore expenditure. The surplus is TK7,971 crore.

The sectors include national saving schemes, state provided fund, renewal, reserve and depreciation fund, deposit account and current assets.