The highest levels of government have expressed serious concern about the sluggish pace of capital spending by Ministries, with some having utilised as little as 11% of their allocated budgets, according to sources.
With more than half the fiscal year having elapsed, it is increasingly likely that no Ministry will be able to utilise its capital expenditure allocations fully by year-end. The underutilisation has prompted President Anura Kumara Dissanayake himself to initiate reviews of Ministry project performance, beginning with the Ministry of Health on Friday (06).
At the review meeting, held at the Presidential Secretariat, President Dissanayake evaluated the progress of infrastructure development and human resource projects in the health sector, as well as the ongoing challenges in medical procurement and pharmaceutical standardisation. Present at the meeting were Minister of Health and Mass Media Dr. Nalinda Jayatissa, top officials from the Ministry of Health and the Ministry of Finance, and senior presidential advisors.
Sources from several ministries identified what they described as administrative paralysis as a key reason for the delay in capital spending. Middle and upper-middle-level Ministry officials reportedly lack the necessary political clearances from recently appointed Ministers and Deputy Ministers, many of whom lack experience. In some Ministries, project implementation has come to a near standstill following political interventions and changes initiated by NPP-aligned union leaders, according to sources.
Despite the government’s focus on infrastructure and development—reflected in the Rs. 1.32 trillion allocation for capital expenditure (roughly 31% of the total non-debt government spending)—implementation has lagged. The 2025 Budget, passed on March 21, allocated Rs. 7.19 trillion in total government expenditure, with notable capital allocations made to sectors such as transport (Rs. 421 billion), agriculture (Rs. 124 billion), urban development (Rs. 98 billion), and health (Rs. 95 billion).
The Ministry of Finance, which received the largest overall budget of Rs. 714.2 billion (including Rs. 229.3 billion in capital expenditure), is expected to take the lead in coordinating remedial action.
Political party sources said that the NPP top brass were disturbed that failure to execute the capital projects effectively could stall the government’s broader goals of economic recovery, infrastructure modernisation, and service delivery reform in 2025.The President is expected to continue Ministry-by-Ministry reviews in the coming weeks to identify bottlenecks, party sources said.