The Standing Committee noted that the Ministry of Cooperation faced significant underutilization of allocated funds in the financial year 2023-24. Initially allocated Rs 1,150 crore at the Budget Estimate (BE) stage, the funds were revised downward to Rs 747 crore at the Revised Estimate (RE) stage.
However, the actual expenditure stood at Rs 689 crore, leading to an underutilization of Rs 59 crore, which accounted for 7.7% of the RE allocation.
A similar trend was observed in 2024-25, where the allocation was Rs 1,183 crore at the BE stage but was later reduced to Rs 750 crore. As of February 14, 2025, the Ministry had spent approximately Rs 573 crore, representing 76% of the RE allocation, with assurances that the remaining 24% would be utilized before the financial year’s end.
The Committee identified key reasons for the underutilization, including delays in receiving proposals from states/UTs, slow fund disbursement due to non-readiness of states, and technical challenges such as the non-mapping of Single Nodal Agency (SNA) accounts.
Acknowledging these initial transition challenges in shifting to a new accounting system, the Committee expressed confidence that the Ministry will achieve full utilization once the systems stabilize.
Looking ahead, the Ministry of Finance has increased the budget allocation for 2025-26 to Rs 1,186 crore, considering the cooperative sector’s immense potential.
This rise in allocation accounts for the establishment of two key institutions—the Cooperative Election Authority and the Cooperative Ombudsman—as well as the computerization of a larger number of Primary Agricultural Credit Societies (PACS).
Additionally, a new Central Sector Scheme has been introduced, under which Rs 500 crore in grant-in-aid will be provided to the National Cooperative Development Corporation (NCDC) to facilitate loans for cooperatives.
The Standing Committee urged the Ministry to expedite the implementation of planned schemes and programs for 2025-26, ensuring timely fund utilization and achieving the intended strengthening and modernization of the cooperative sector.
