CAG flags Tamil Nadu’s fiscal stress, revenue leaks, implementation lapses

CHENNAI: The Comptroller and Auditor General of India (CAG) has flagged continuing fiscal pressures, revenue leakages and deficiencies in the implementation of major welfare and infrastructure programmes in Tamil Nadu, while also pointing to operational and financial concerns in State-owned enterprises.

Addressing the media at a press conference here on Tuesday, principal accountant general (Audit-I), Tamil Nadu, R Thiruppathi Venkatasamy provided key insights into the findings of seven CAG reports presented in the Tamil Nadu Legislative Assembly.

The reports cover the State's finances for 2024-25; State revenues for the period ended March 2024; educational scholarship schemes for SC/ST/SCC students; power generation activities of the Tamil Nadu Generation and Distribution Corporation Limited; state public sector enterprises (SPSEs); Jal Jeevan Mission; and implementation of the Smart City Mission.

The State Finances Audit Report for 2024-25 noted that Tamil Nadu recorded robust GSDP growth of 15.98%, but continued to face fiscal pressures. The State reported a revenue deficit of Rs 45,840 crore, while revenue receipts grew by only 6.89%. Revenue expenditure accounted for 84.70% of total expenditure, committed expenditure for 53.75% of revenue expenditure and subsidies for 16%. The CAG also observed that a significant portion of borrowings was used for revenue expenditure and debt servicing rather than asset creation.

The report further found that revenue arrears stood at Rs 58,110.16 crore as of March 31, 2025, of which Rs 28,726.53 crore had remained outstanding for more than five years. The arrears accounted for 27.18% of the State's own revenue.

Thiruppathi said the seven reports highlighted the need for tighter monitoring, improved revenue realisation and greater accountability.