Page 50 - economic review

MACRO ECONOMIC PROFILE 22

Amount (in Crore) Revenue Expenditure

1.61 The revenue expenditure of the State is mainly comprised of expenditure on salaries, pension,
debt charges, devolutions to the Local Self Government and subsidies. The operational and
maintenance cost for the upkeep of the completed projects and programmes are classified under the
revenue account. Grants provided by the State to meet salaries and pension liabilities of employees
in the Universities and State autonomous bodies and also the pension liabilities of employees of
Panchayat Raj Institutions are classified under revenue expenditure. Major portion of funds devolved
to local bodies from the revenue account of the State government is utilized for the creation of capital
assets of durable nature. A significant share of grant-in-aid set apart for universities and autonomous
institutions are now meant for creation of capital assets. Non-developmental expenditure of the State
mainly constitutes the committed expenditure consisting of debt charges, expenditure on pension
payments and administrative services.

1.62 The growth in revenue expenditure in 2011-12 was relatively higher at 32.83 percent. It was
mainly on account of larger commitment for implementation of 9th pay commission recommendation.
Subsequently it came down to 16.17 percent in 2012-13 and in 2013-14 it dropped to 13.08 percent.
Total revenue expenditure in 2013-14 was ` 60485.50 cr. Of this, plan expenditure was ` 7073.66
cr and non-plan expenditure ` 53411.84 cr. The ratio of revenue expenditure relative to GSDP has
shown signs of stabilization during the last few years and this trend continued in 2013-14 also. This
was in the ratio of 15.31 and 15.01 per cent in 2012-13 and 2013-14 respectively. The trend in
Revenue Expenditure from 2008-09 to 2014-15 BE is given in Fig. 1.9.

Fig 1.9
Trends in Revenue Expenditure
Revenu e Expend iture

80000
70000
60000
50000
40000
30000
20000
10000

0

Year

Source: Finance Department, Govt. of Kerala

1.63 Expenditure on committed liabilities on salaries, pension, interest payments, subsidies and
devolution to LSGs constitutes 70.24 per cent of revenue expenditure in 2013-14. During this year
86.40 per cent of the revenue receipts of the State was used for meeting the above committed
expenditure. Expenditure on market intervention operations to contain price rise of essential
commodities, inclusive policy initiatives to bring all weaker sections of society under social security
net and government’s efforts to impart quality services in health and education sectors were also the
important factors contributed for increased revenue expenditure.

1.64 In 2013-14 salary expenditure as proportion of total revenue expenditure was 31.88 per cent
whereas it was 32.26 per cent in 2012-13. Pension expenditure as percentage of total revenue
expenditure was 16.49 per cent in 2013-14 compared to 16.58 per cent in 2012-13. Interest payment

Kerala State Planning Board