Even the final plan document is being prepared by the Planning Commission, the Health Ministry has sought a total allocation of Rs.4,04,490.96 crore for the activities of the Department of Health during the current 12th Plan period with a view to raising the expenditure level to the tune of 2.5 per cent of the GDP by 2017.

However, sources said the proposed demand for outlay looked much higher and it may not be approved, if the amount already approved for the current financial year is any indication.

Out of the total sum required, Rs.2,19,702.45 crore will be for the National Rural Health Mission (NRHM) and Rs.1,84,788.24 crore for health. However, the Planning Commission sanctioned only Rs.27,127 crore for the financial year of 2012-13, against a demand by the department for Rs.45,532.18 crore. This comprised of Rs.6,585 crore under Health and Rs.20,542 crore under NRHM. The outlay for 2012-13, approved by Planning Commission, is only 59.58 per cent of the proposed outlay for 2012-13, sources said.

There was a shortfall in allocation of funds to the tune of Rs.10,507.53 crore vis-à-vis the proposed outlay for 2012-13, even as the Government reiterated its commitment to raising the expenditure for health from roughly 1 per cent of the GDP to 2.5 per cent of the GDP by the end of 12 th Plan.

The under utilisation of the allocated funds by the Department during the 11th Plan also may deter the Planning Commission from allowing a huge hike in the total outlay for the current Plan period. A total of Rs.22,365 crore was sanctioned under the Plan head as per budget allocation during the 11th Plan and it was revised to be at Rs.19,396.19 crore in the later stage. The Department could so far spend only Rs.17,221.58 crore during the period, the statistics show.

The Parliamentary Standing Committee on Health had also remarked on the under-utilisation of the funds, in its report on the Demands for Grants. “The Committee is constrained to observe that there was substantial and persistent under-utilization of the budgeted funds during the 11th Plan. That the savings occurred under the Plan head underlines the fact that the development activities have been curtailed. Though the Committee is supportive of the Department’s demand for higher allocation of funds, it deprecates the Department for failing to optimally utilize its Plan Allocations over the last five years. The Committee observes that the underutilization of budgeted funds is indicative of slack monitoring on the part of the Department as well as formulation of the Budget Estimates in a ritualistic manner without application of proper financial yardsticks,” the report said.