PC's budget cuts draw fire from colleagues in govt

  • Chetan Chauhan, Hindustan Times, New Delhi
  • |
  • Updated: Feb 21, 2013 11:57 IST

Finance minister P Chidambaram's intent to walk the talk on fiscal discipline and nurse the government's delicate balance sheet back into health by controlling expenses appears to have run into stiff resistance from ministerial colleagues, who fear it would leave lesser resources to fund flagship welfare schemes.

Sources told HT that finance ministry wants the gross budgetary support (GBS) for 2013-14 to be limited to a level that many ministries fear will significantly shave off funds allotted to them, compared to last year.

The central plan is funded almost equally from government's own accounts or the annual budget and the resources that flow in from public enterprises.

The government's support to the central plan is called the gross budgetary support, or the GBS.

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For 2012-13, the GBS was originally set at R5,21,000 crore, which was later slashed by 20% or to around Rs.4,16,000 crore.

Sources said that Chidambaram wants the GBS to be raised by only 15% of the revised estimates-a move some of his colleagues feel will upset social sector schemes leading up to an election year.

Tribal affairs minister Kishore Chandra Deo, rural development minister Jairam Ramesh and defence minister AK Antony are some of the ministries who have objected to the proposed cut in allocations.

"The plan size could not be finalised as what finance ministry is offering is not acceptable to the ministries," a planning commission functionary said, after a meeting at the PMO failed to hammer out an agreeable fund allocation model.

 

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