Underspend


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Underspend

To spend less than one was allotted in a budget. Underspending in personal finance is almost always a good thing as it allows one to save more or to pay down debts. In corporations, however, underspending can be negative; for example, if a department does not spend its entire budget, the executives may conclude that it does not need such a high budget and cut that department's allotment. This creates a perverse incentive for departments and other subdivisions to spend their entire budget whether or not they need to.
References in periodicals archive ?
The funding goes towards day-to-day running of long-term projects like sewerage replacement - capital projects where most of the underspend can be linked to delays.
Lib-Dem council leaders were accused of incompetence last week after the massive underspend was revealed.
She dismissed Plaid criticism over underspends, saying the need to tackle the problem was the key theme of her budget.
With pounds 623,000 of the parking division's underspend arising from parking fines, the remaining pounds 254,000 was due to vacancies within the department.
But we have made it clear that a number of efficiency savings by the Royal Household and low inflation has led to an underspend in the Civil List.
Then Finance Minister Angus MacKay promised better housekeeping would ensure that there would be a major reduction in the underspend.
Then Finance Minister Angus MacKay promised better housekeeping would ensure a major reduction in the underspend.
Finance Minister Angus MacKay admitted the underspend was worrying but tried to make the best of the situation by revealing where the cash would now go.
As a result of prudent decisions and effective financial management, the 2014-15 underspends are being invested in the current year to support Scotland's economy.
Clr Naheed Mather, chair of the Huddersfield District Committee and also a Dalton Labour member, said: "It's very easy to look at the budget and think there's an underspend and spare money for Dalton, but the money has been earmarked.
Last year, the allowance of PS764,000 was in the hands of the Labour council which allowed a PS500,000 underspend - turning down more than 90% of applications from people in desperate need, often sending them to food banks instead.
A COUNCIL district chief has refused to reinstate funding for lollipop men and ladies despite the accounts showing a PS200,000 underspend.