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Social sectors may get less from FM

For the first time in six years, allocation for the social sector is likely to be less than the proposed hike for plan expenditure for 2010-11, reports Chetan Chauhan.

business Updated: Feb 16, 2010 22:03 IST
Chetan Chauhan

For the first time in six years, allocation for the social sector is likely to be less than the proposed hike for plan expenditure for 2010-11.

In the estimates finalised Finance ministry and Planning Commission, the major areas in social sector such as education, health, social justice and rural development are likely to get a 11 per increase in allocation over the financial year 2009-10.

The government has reportedly increased the gross budgetary support (GBS) for the next fiscal by 15 per cent, in a bid to rein in the fiscal deficit at below six per cent.

“The idea is to bring down the fiscal deficit to manageable terms,” said a senior government official. The deficit in the last budget was projected to be 6.8 per cent.

All this would mean that GBS for the next fiscal would be

Rs 3,73,000 crore as compared to Rs 3,24,000 in the financial year 2009-10, which Planning Commission deputy chairperson Montek Singh Ahluwalia described as “good”.

Since 2004, when UPA came to power, the increase in plan fund has ranged between 17 and 23 per cent.

“We have a very satisfactory outcome on Plan expenditure,” Ahluwalia said while stressing on effectiveness of the expenditure. The panel had sought a 19 per cent hike in GBS.

India’s social sector would continue to get fillip in the 2010-11 budget but it would be lowest in the six years of the UPA government. And, the National Rural Employment Guarantee Scheme (NREGS) — the world’s biggest employment programme — would be the worst-hit with an allocation increase of just 2.5 per cent. Poor spending in 2009-10 is blamed for this decline.

“Till December 2009 only half of the funds allocated for NREGS were spent,” said Mihir Shah, member Planning Commission, in-charge of rural development.

He, however, expected the expenditure to increase in first three months of 2010 as demand for work would increase

Among social sectors, the government is keen to roll out its ambitious scheme Unique Identification Number (UID) for all Indian residents by December 2010. The plan panel has made an allocation of Rs 2,000 crore for this fiscal.

Another ministry to get huge jump in funds is Social Justice and Empowerment, whose plan budget would be doubled to Rs 5,000 crore, mainly to fund scholarship schemes for Scheduled Castes and the disabled.