Chief Minister Siddaramaiah on Monday tabled the Comptroller and Auditor General’s (CAG) report on State Finances for 2023-24 in the Karnataka Assembly, revealing the financial impact of the Congress government’s flagship “five guarantees.”

According to the report, the state government borrowed a net ₹63,000 crore from the market in 2023-24 to meet expenditure on the welfare schemes, a steep rise of ₹37,000 crore compared to the previous year’s net borrowings of ₹26,000 crore.

The report stated that the five guarantees accounted for nearly 15% of the state’s total revenue expenditure. The financial outgo in 2023-24 included ₹16,964 crore for Gruha Lakshmi, ₹8,900 crore for Gruha Jyothi, ₹7,384 crore for Anna Bhagya, ₹3,200 crore for Shakti, and ₹88 crore for Yuva Nidhi.

The fiscal deficit, which stood at ₹46,623 crore in 2022-23, rose sharply to ₹65,522 crore in 2023-24, primarily due to the guarantees. The CAG further pointed out that capital expenditure towards infrastructure dropped by around ₹5,229 crore as a result of the increased spending on welfare schemes.

The report also flagged irregularities in expenditure. An excess spending of ₹2,851.48 crore was noted under eight grants in 2023-24, while an additional ₹2,323.74 crore incurred in earlier years (2020-21 and 2022-23) remains unregularised.

On personal deposit accounts, the CAG observed that balances have been steadily increasing since 2020-21, with an 11.27% rise in 2023-24 alone. The surge was attributed to deposits by the Karnataka Mining Environment Restoration Corporation, as per Supreme Court directives. However, the auditor raised concerns that retaining such large sums in personal deposit accounts goes against the principles of legislative financial control.

The report also highlighted Karnataka’s rising debt burden. The state’s liabilities grew at an average annual rate of 17.35% between 2019-20 and 2023-24. While the debt-to-GSDP ratio had declined to 23.03% in 2022-23, it climbed again to 23.49% in 2023-24 due to higher borrowings.

(Reported by Prashobh Devanahalli)