Condition slapped on Tk500 crore ADP disbursement 

The finance ministry has imposed a condition on the disbursement of Tk500 crore by the Planning Commission under the annual development programme (ADP). 

Under the ADP allocation, the commission used to be able to disburse funds, independently, against the demand of the ministries. However, from now on, ministries' demands will require the finance ministry's approval before funds are disbursed.    

A circular, signed by Finance Division Joint Secretary Mohammed Walid Hossain, was issued in this regard on Monday. The move has been treated as part of the government's austerity measures against the backdrop of Covid-19 fallout.      

The Planning Commission got a Tk500 crore block allocation in the national budget for the 2020-21 fiscal year to meet the demand of numerous projects being implemented by the ministries.

"The Planning Commission used to disburse money independently from that fund upon receiving demands from the ministries. Now, the commission will require the finance ministry's go-ahead for any such allocation," Mohammed Walid Hossain told The Business Standard.

"We neither cancelled nor postponed the block allocation," he added.   

According to Finance Division officials, the government is doing its best to minimise the pandemic's fallout and adverse impacts. Therefore, the block allocation for ADP implementation has been increased to five times higher than it had been. A fund of Tk4,026 crore has been set aside for government and foreign-funded projects to tackle the pandemic.

Previously, the finance ministry put a hold on funds released to low-priority development projects. Further, conditions were imposed on mandatory expenditures for medium-priority projects.

The measures will save an estimated Tk40,000 crore; which would free-up funds for productive sectors at a time when revenue shortfall widens.