Move aims at reining in expenditure and reducing fiscal deficit
Panaji : New Year 2026 started on a note of austerity for the state with the government implementing 25 per cent revenue expenditure cuts for every department for the remaining three months of 2025-26.
The revenue cuts are aimed at curbing expenditure and reducing the fiscal deficit.
Besides the 25 per cent revenue expense cuts, departments have been told to spend no more than 20 per cent of the budgetary estimates in the last quarter of the financial year (except under flagship schemes). They have also been told to reduce wherever possible expenditure by 40 per cent until the financial year-end.
The government has banned unnecessary spending on purchases of office furniture, cupboards, furnishing, etc, as well as computers, Xerox machines, ACs, telephones, fax machines, government vehicles and staff cars.
No bills of purchase for the said banned items will be entertained in the next three months and in the next financial year 2026-27.
Departments have to ensure that payments for purchase of goods and services to contractors, etc are not for any new purchases. The austerity drive excludes loans and advances given to government servants.
The order issued by undersecretary, finance, Naresh Gaude instructs the Directorate of Accounts to monitor the expenditure under each demand for grants and see that it does not exceed the said restrictions unless authorised by the Finance Department.
Moreover departments have been directed to surrender their savings made on revenue account.
The government has said the austerity measures are to achieve the targets set out in the Goa Fiscal Responsibility & Budget Management Act, 2006, and also to provide adequate funds for development activities under capital account as well as provision for payment of revised pay and arrears.
One of the targets of the GFR&BM Act is to reduce the fiscal deficit to 3 per cent of the gross state domestic product.
Goa’s outstanding debt was Rs 35,723.6 crore in 2024-25 vis-à -vis Rs 32,972 crore in 2023-24. Market borrowings at Rs 21,674 crore raised through issue of state development loans over the years comprised a chunk of the outstanding liabilities in 2024-25, resulting in expenses Rs 2,050 crore expenditure on interest payment.
