Question

Does decrease in bond length decrease total energy

Answer 1

Bond length decrease also decrease the total Energy Because of less than produce Energy

Answer 2

I would think it in terms of energy instead to make a little more precise. Thinking about a diatomic molecule, the nuclei-nuclei repulsion function of distance does not change with the basis set used. So the difference is strictly in terms of electronic part. At large distance the atoms behave more similar to an isolated atom, so few spherical harmonics are enough (for a relative description). As atoms get closer it is needed more flexibility to represent the very different probability density that there is in the space region located between atoms. With a smaller basis set this wave function is approximated poorer. If so, it is expected that the energy rises in such region if one consider the variational principle.