Big Brother watching, Punjab tries to ‘live within means’ | chandigarh | Hindustan Times
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Big Brother watching, Punjab tries to ‘live within means’

chandigarh Updated: Mar 19, 2015 17:55 IST
14th finance commission


“The budget has been prepared in a changed backdrop created by increased devolution of funds from the 14th finance commission and a concomitant reduction in plan transfers to states from the Centre. The government is taking all steps to ensure that it lives within the means,” Punjab finance minister Parminder Singh Dhindsa said while presenting his fourth budget on Wednesday.

The realism that a bailout from the NDA (National Democratic Alliance) regime at the Centre may not come if it does not exercise prudence was evident in both Dhindsa’s speech and his proposals. He skipped announcing any new welfare schemes and repackaged some old proposals as new. In the absence of political will and consensus between ruling allies, he could also not announce any new taxes. Dhindsa in his speech and, later, deputy chief minister Sukhbir Singh Badal in a press statement went on to credit Punjab’s being removed from the list of revenue-deficit states to “fiscal turnaround” brought by their government.

Also read: No new taxes proposed in Punjab budget

The 10% jump in devolution of funds from the Centre to the states has its imprint in the state’s cash position. Punjab expects its share in the central taxes to jump by Rs 2,598 crore, from Rs 5,400 crore in the year 2014-15 to Rs 7,998 crore in 2015-16. The FM claimed that the revenue deficit would be curtailed to 1.6% of GSDP (gross state domestic product). But few would believe Dhindsa as the budget estimate for last year had shown revenue deficit at 1.22% and it had jumped by 46% to 1.78% in the revised estimates.

Rebranded schemes

With little room for profligacy, Dhindsa tried to have the imprint of both CM Parkash Singh Badal and Deputy CM Sukhbir Badal in his proposals, rebranding some old proposals and schemes, where needed. Last year, Dhindsa had announced Rs 500 crore for the skill development of youth. He has repackaged it as “state skill development mission”. Under it, 22 multi-skill development centres will be set up, one in each district. In addition, three specialised centres will come up in the construction sector and 2,000 skill training centres for girls and 500 for boys will be opened in the government schools in villages.

Also Read: Fiscal mis-management: Hazy road map, no plan with Punjab

He also announced the ‘Mukh Mantri Pendu Vikas Yojana’ for the comprehensive development of villages, its key constituency. However, analysts see it as an attempt to rebrand CM’s sangat darshan grants, hitherto funded by the rural development fund (RDF), which the Union finance ministry has said should be routed through the state’s consolidated fund. The CM also gets `500 crore more this year for various memorials.

To boost micro and small enterprises, the FM has announced interest subvention under a new “Entrepreneurship development programme” and tried to infuse Rs 600 crore into sugar co-operatives. The budget also promises 50,000 houses for the urban poor in the next two years. Sukhbir had last year announced 1 lakh houses for the EWS (economically weaker section) families.

Also Read: Punjab Budget: Central funding in flagship schemes reduced by half

Other than launching the scheme for small and micro enterprises and promising houses to urban poor, the budget also promises gaushalas (cow shelters) in every district to humour ally Bharatiya Janata Party (BJP).

‘Realistic’ promises, unrealistic growth rate

Dithering from fulfilling its poll promise of laptops and data cards for schoolchildren, the FM has announced that girls’ schools will be provided with better facilities, including toilets. While he made the allocations for power subsidy and new atta-dal scheme, Dhindsa resisted the temptation to fulfil the long-pending poll promises of his party, be it the unemployment allowance, hike in shagun amount and pensions, or provident fund for farmers, as he said he was steering the state towards fiscal consolidation by keeping the budget “realistic”.

Not all, however, was realistic in his budget speech. The growth rate has been pegged at 10.16% at current prices, which factors in inflation. It fails to state that the growth rate is just a modest 5.4% at constant prices, which is the real indicator of an economy’s growth.

Also Read: Punjab annual budget: 15% jump in free power subsidy

Key proposals

State skill development mission

Rs 500 crore was announced for skill development in last budget, too. This budget rebrands it as a new scheme. Imparting skills to youth is important owing to drug menace.

Mukh Mantri Pendu Vikas Yojana

An attempt to rebrand CM's sangat darshan grants hitherto funded by the rural development fund (RDF). Villages are key constituency of the Shiromani Akali Dal.

Entrepreneurship development programme

Since the new industrial policy and investment summit had ignored the micro and small enterprises, the FM has announced interest subvention on loans to boost this sector.

Scheme for strengthening girls’ schools

The aim is to provide schoolchildren with better facilities, if not free laptops and data cards. The budget also promises bicycles to girls in Classes 11 and 12

Solar rooftop programme

Solar rooftops in 1 lakh homes will promote the use of renewable energy, a department held by minister Bikram Singh Majithia, brother-in-law of the deputy CM.

Rs 600 crore for sugar co-operatives

The aim is to boost sick sugar mills and make sugarcane cultivation lucrative for farmers to undertake crop diversification

50,000 houses for urban poor

Sukhbir had last year announced 1 lakh houses for the EWS families. This budget slashes it to 50,000. Urban housing is Sukhbir's department.

Gaushalas in each district

A long-pending demand of ally BJP

Rs 10 crore for burial grounds

The CM wants to woo Christian, Muslim minorities