State Audit Slams ‘Budgetary Incoherence’ as Rs 2 Billion Go Unspent

A damning audit of the 2024-2025 Budget has revealed that Rs 2 billion (MUR) of public funds remained unspent by the close of the financial year, raising serious questions over fiscal management and transparency.

The report highlights a trend of “budgetary incoherence,” noting that Rs 1.7 billion of these dormant funds were eventually reallocated to other areas.

Most controversially, the audit found that government departments sought and received supplementary credits even while original budget allocations remained untouched.

Failed Climate Funding and Secret Subsidies

A primary example of this fiscal friction involves the Climate and Sustainability Fund (CSF).

Despite an initial allocation of Rs 3.2 billion, projects were delayed and eventually funneled through the National Environment Fund (NEF).

Rather than simply transferring the existing CSF money, officials approved an additional Rs 1.1 billion in supplementary credit on 24 April 2025.

Consequently, by 30 June 2025, Rs 2.5 billion originally intended for climate projects was diverted to the National Property Fund Ltd (NPFL)—a move not featured in the original budget.

Mismanagement of Resilience Funds

The audit also scrutinised the National Resilience Fund, which was granted Rs 8.5 billion to assist employers with the 14th-month bonus and salary compensation.

Despite the Rs 3.9 billion in supplementary credits requested for these schemes:

• Rs 1.2 billion remained unused by 30 June 2025.
• This included Rs 500 million from initial credits and Rs 700 million from the additional “emergency” funding.

The report suggests this under-utilisation points to a “limited capacity” to effectively mobilise allocated resources.

The National Property Fund Bailout

In a last-minute maneuver on 30 June 2025, the government transferred Rs 2.58 billion to the NPFL. This substantial grant was stitched together from various sources:

• Rs 87.5 million for interest payments, taken from funds meant for salary compensation.
• Rs 2.5 billion for capital repayment, diverted from the Climate and Sustainability Fund.

“The funds initially intended for CSF projects were redirected to a new use, while those projects were ultimately financed mainly by supplementary credits… highlighting a lack of consistency and transparency,” the report stated.

Ministry Response

In its defense, the Ministry of Finance maintained that all budgetary reallocations were conducted in “strict compliance” with financial instructions regarding credit transfers.

The Ministry further asserted that all excess expenditure, barring the 2022-2023 financial year, has been duly regularised under the Supplementary Appropriation Act.

Source: Defi Media