Mumbai: The Comptroller and Auditor General (CAG) has criticised the implementation of the Mukhyamantri Majhi Laadki Bahin Yojana, saying it was marked by “significant deficiencies” in budget estimation, expenditure control and financial management.The CAG report released on Friday said state govt had spent over Rs 33,237.2 crore on the scheme, exceeding its budgetary provision by nearly Rs 3,541.2 crore which “remained unjustified”. It also observed that the sharp rise on women welfare schemes from Rs 261.8 crore in 2023-24 to Rs 33,554.4 crore in 2024-25, especially under the Mukhyamantri Majhi Laadki Bahin Yojana reflected a major push toward welfare-oriented transfers rather than capital formation. However, expenditure in the social sector for housing (54.7%) and water supply and sanitation (31.8%) notably decreased compared to 2023-24.Ahead of the assembly elections, the state govt launched the Laadki Bahin Yojana on June 28, 2024, allowing eligible women aged 21 to 65 to receive a financial benefit of Rs 1,500 per month through direct benefit transfer.Rising expenditure a concernMaharashtra’s economy remains one of the strongest in the country, but rising day-to-day expenditure and growing liabilities could leave the state with less money for development works and force it to borrow more in the coming years, the CAG cautioned.The audit report said the state’s strong Gross State Domestic Product (GSDP) growth and higher-than-national per capita income provide a solid economic base. “However, the widening revenue deficit, rising committed expenditure and growing liabilities could affect the state’s long-term financial health.”The CAG said Maharashtra has remained within the borrowing and fiscal deficit limits prescribed under the Fiscal Responsibility and Budget Management Act, but its revenue deficit has increased sharply. With undischarged liabilities exceeding Rs 27,184 crore, both the revenue and fiscal deficits could worsen.The report said govt is increasingly borrowing to meet routine expenditure instead of creating long-term assets such as roads, schools, and hospitals. A growing share of tax revenue is being spent on salaries, pensions, interest payments and subsidies, leaving less fiscal space for infrastructure and other capital works.Salaries, pensions and interest payments together accounted for nearly Rs 2.5 lakh crore, or 52% of the state’s revenue receipts in 2024-25. Although this proportion has declined from earlier years, it continues to limit fiscal flexibility. Subsidies rose 16.7% to Rs 56,089 crore, mainly due to higher electricity tariff subsidies for farmers and support for cotton, soybean and oilseed cultivation. The CAG said such expenditure should be kept fiscally sustainable.The report also flagged weaknesses in budget management, including excessive supplementary grants, departments failing to spend funds despite additional allocations, delayed surrender of savings and heavy expenditure in the final month of the financial year. Such year-end spending, it said, weakens financial discipline and legislative scrutiny.The audit also noted that Centre did not release the 15th Finance Commission grant of Rs 1,391 crore for million-plus cities in Maharashtra during 2024-25. The state has six eligible urban agglomerations where these grants are meant for air quality, drinking water and solid waste management.Poor financial reportingThe CAG also raised concerns over the quality of the state’s financial reporting, saying several accounting practices were undermining transparency and accountability. Off-budget borrowings stood at Rs 28,640 crore as of March 31, 2025. The audit also found that govt did not account for around Rs 762.5 crore in interest payable on several interest-bearing deposits, understating expenditure and overstating public account balances. Furthermore, nearly Rs 3,277.6 crore of National Pension System contributions remained parked instead of being transferred to the designated pension fund manager, contrary to Government of India guidelines.Parking of fundsThe CAG criticised govt for leaving nearly Rs 20,993.1 crore unutilised in treasury-approved Virtual Personal Deposit Accounts (VPDAs) beyond the financial year, calling it “financially imprudent” as it distorted the fiscal deficit and led to additional borrowings. The CAG said that had the unspent VPDA balance been returned to the consolidated fund on Ma-rch 31, 2025, state’s revenue deficit would have been Rs 9,001.7 crore instead of Rs 29,994.8 crore, effectively inflating the deficit by Rs 20,993.7 crore.
