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24 June 2026

CAG report on Kerala finances

The CAG report is a formal constitutional document that provides specific data on state fiscal health, federal financial relations, and public fund management, making it highly relevant for GS2 and GS3 mains answers.

1 min read Day 2 of 6 2 questions 1 prelims

Notes

  • Kerala's GSDP grew by 9.97% in 2024-25, but tax collection growth did not keep pace.
  • Revenue receipts recorded a negligible growth of 0.30% in 2024-25 compared to the previous year.
  • Revenue receipts as a percentage of GSDP reached a decadal low in 2024-25.
  • Committed expenditure (salaries, pensions, interest payments) reached ₹98,563.59 crore in 2024-25.
  • Committed expenditure accounts for approximately 79% of the state's revenue receipts.
  • CAG recommends urgent spending reforms, including better targeting and prudent management of salary and pension commitments.
  • CAG flagged the practice of transferring funds from Treasury Savings Bank (TSB) accounts, including the Chief Minister’s Disaster Relief Fund (CMDRF), to the Consolidated Fund of the State.

Part of a longer story

This is day 2 of 6 in Kerala's fiscal health and financial management, which has been running since 22 June 2026. Reading it whole is usually worth more than reading today alone — the exam asks how something developed.

Questions

  1. Analyze the fiscal challenges faced by states where committed expenditure consumes a significant portion of revenue receipts. Discuss the implications for developmental spending and fiscal flexibility. 150 words
    Attempt this — 150 words in 8 min
    0 / 150 words 8:00
  2. The Comptroller and Auditor General (CAG) plays a pivotal role in ensuring fiscal accountability in India. In light of recent findings regarding state finances, discuss the importance of expenditure reforms and the constitutional role of the CAG in auditing the Consolidated Fund of the State. 250 words
    Attempt this — 250 words in 11 min
    0 / 250 words 11:00

Prelims

  1. According to the recent CAG report on Kerala's finances, what percentage of revenue receipts was accounted for by committed expenditure (salaries, pensions, and interest payments) in 2024-25?

Syllabus

Topics

Sources

250words.in · https://250words.in/daily/2026-06-24/cag-report-on-kerala-finances