E-Paper
Reflections, announcements and ground reality of Punjab budget
For the past many years, schemes are announced but adequate funds are not released. This has lowered government’s credibility. To win people’s trust, the government has to stand by its commitments made in the budget
While presenting the Punjab budget for the 2020-21 fiscal, finance minister Manpreet Singh Badal claimed that there is a positive turnaround in the state finances. There is a primary surplus to the extent of ₹247 crore, which has happened after 2006-07. If true, it’s good news for Punjab and its people. Youth have a reason to rejoice as the promised one-lakh vacancies in government sector will be filled in the coming year and state government employees can expect new pay scales by December 2020.
The estimated funds for centrally-sponsored schemes and state’s own programmes will not suffer on account of fund crunch. Free power supply for farm tubewells will continue and ₹2,000 crore has been allocated for continuation of loan waiver for small farmers with cooperative loan up to ₹2 lakh per farmer. Those farmers who do not burn crop residue will get a bonus of ₹100 per quintal of grain sold. This is a good step to check crop residue burning and meet the farmers’ enhanced cost of stubble management in an alternative way. In order to better utilise canal water and improve efficiency of irrigation, ₹2,510 crore has been allocated for upgrade of canal water supply. The landless farmers and agricultural labourers will also get loan waiver for institutional loan for which ₹520 crore has been allocated in the budget.
₹200 CR FOR BORDER, KANDI AREAS
To meet the special needs of the border and kandi areas, a special provision of ₹200 crore has been made in the budget, ₹100 crore each for the border and kandi area of the state. This will be spent to upgrade school education, health infrastructure and meet piped water supply. In addition, ₹100 crore has been provided to meet state share in the centrally-sponsored Border Area Development Programme. The finance minister has made adequate provision of state’s share in the centrally-sponsored schemes such as Prime Minister Awas Yojana, Ayushman Bharat Health Insurance Scheme, Atal Mission for Rejuvenation and Urban Transformation (AMRUT) MGNREGA, etc.
It is a well-known fact that any economy on the path of structural transformation throws labour out of agriculture to be absorbed in the secondary and territory sectors of the economy. The state budget displays this awareness. To translate this into concrete policy intervention, a series of measures have been announced. This includes massive power subsidy to industry to the extent of ₹2,200 crore, development of three industrial parks at Moga, Rajpura and Ludhiana, push to start-up scheme and skill formation in the state.
EMPLOYMENT OPPORTUNITIES
Besides, the Punjab government plans to start a massive recruitment process to fill one-lakh vacancies in the 2020-21 fiscal in the various government departments. The push to industrial development is expected to generate employment activities, including self-employment programmes in the micro, small and medium enterprises. This has been accompanied by sufficient allocation for social welfare schemes such as Public Distribution System (Dal Atta Scheme), integrated child development scheme, free education for all children in government schools up to Class 12, old-age pension, Shagun Scheme for marriage girls belonging to the Scheduled Caste families, etc.
NO RELIEF FOR GOVT STAFF
The budget speech and subsequent press conference and assurances of the finance minister point towards improving state finances and governance. This has also raised the hopes and aspirations of various sections of the society. The budget needs to be examined from the experience of the past and current liabilities of the state. With reported turnaround of the budget, the employees expect that the government releases 24% of additional dearness allowance (ADA) instalments along with the just arrears, but the finance minister announced just one instalment of the ADA form March 1, 2020. This has invited serious criticism and reflects poorly in the state of the government finances. Employees’ organisations have termed it a poor joke to them. There is no relief for anganwadi, Asha workers and contractual employees who have been agitating in the state for many years.
For the past many years, including the 2019-20 budget, schemes are announced but adequate funds are not released. This has lowered government’s credibility. To win the people’s trust, the government has to stand by its commitments made in the budget. The schemes announced must be backed by details of implementation. While making announcement of ₹200 crore for promotion of maize cultivation, the government has not specified whether it is for the minimum support prize (MSP) or procurement and storage of the crop produced in the state. The vagueness in announcement creates confusion and smacks of gimmicks.
MAKE AGRICULTURE VIABLE
At the same time, agriculture crisis is severe in the state. A large number of farmers are committing suicides due to non-viability of agriculture. The agricultural labourers are also committing suicides due to non-availability of work. The state needs a roadmap to handle it. This is absent in the current budget except for continuation of loan waiver scheme.
CHECK MOUNTING DEBT
The state will accumulate a huge debt burden of ₹2,48,805 crore in 2021. This is up by more than ₹19,000 crore from the last year. In the last budget (2019-2020), nearly one-third of the budgeted expenditure (₹30,300 crore) was for debt servicing. This is a big drain on the resources of the state. At a time when the government claims that there is turnaround in the budget, it must announce a plan for retirement of this mountain of debt instead of raising it.
STOP BRAIN DRAIN
The youths of the state is leaving the country in lakhs (1.5 lakh last year) by mortgaging or selling their property. This is not only causing brain drain, but also drain of physical capital. On an average, every student is taking $15,000-20,000 along with him/her from the state. In many cases, the parents are also following the children to settle abroad. Apart from economic reasons, there are social, cultural and administrative factors behind this great wave of emigration. It must be stopped to save Punjab from social, economic and cultural point of view. These transformational issues need to be taken on priority in a situation when the government feels confident of its capacity.
It is legitimate to ask when our leaders will shift their attention from self-promotion of enhanced salaries, big and luxury cars and fabulous pensions towards solution of major problems of the state? The ordinary employee has been pushed out of old pension scheme while our representatives are getting a pension every time they get elected. Why they be given pensions? Why our youth is being denied full pay scales at entry of service for three years when in neighbouring states they get full pay? The people need answers to these questions, especially when the government asserts that its finances have turnaround.
(The writer is former director general, CRRID, Chandigarh, and economist. Views expressed are personal.)
