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The A, B, C … of Punjab budget 2013

Hindustan Times cuts through the jargon and jugglery of the statistics-loaded budget and brings out the key phrases, personalities and political expedients that shaped finance minister Parminder Singh Dhindsa's budget, laying out the SAD-BJP government's growth roadmap for the year ahead.

chandigarh Updated: Mar 21, 2013 00:20 IST

Hindustan Times cuts through the jargon and jugglery of the statistics-loaded budget and brings out the key phrases, personalities and political expedients that shaped finance minister Parminder Singh Dhindsa's budget, laying out the SAD-BJP government's growth roadmap for the year ahead.

Having tasted the success of the atta-dal scheme as a key clincher in the 2012 assembly elections, the budget has shrewdly widened the ambit of this flagship scheme. Now all girls born after April 1, 2011, in atta-dal families (with income below R30,000 and those adopting the two-child norm shall be eligible beneficiaries).

Dhindsa's presentation has an unmistakable stamp of both Badals who ostensibly wrote the main script. Reflected all through the 60-page budget speech are Parkash Singh Badal's time-tested populist approach and Sukhbir's think-it-big philosophy.

As in other central schemes, the budget has missed taking credit for implementing the UPA government's programme on direct cash transfer of 34 schemes based on the Aadhaar card. Gurdaspur, Fatehgarh Sahib and Shaheed Bhagat Singh Nagar are directly transferring cash to beneficiaries.

The only figure that has shown a quantum leap in the budget is the state's outstanding debt burden that has ballooned to R83,000 crore, eating up the state's scarce resources in debt servicing and leaving little for development.

A year after its much-touted pre-poll promises on employability allowance of R1,000 per month to youth, the budget has finally provided R1 crore for implementing the scheme. It's a different matter that the scope has now been restricted to only students of higher education. Bad luck for 35 lakh unemployed youth!

Caught in financial crunch, the FM has been struggling to meet even committed liabilities such as salary of the government workforce. He has done little on resource mobilisation except take baby steps such as hike in VAT on cigarettes and soft drinks. He is banking primarily on growth in value-added tax collections.

The budget has earmarked an outlay of R39 crore for governance reforms, one of the key initiatives spearheaded by Sukhbir. Though the right to service act promised to provide 69 services in a time-bound manner, urban delivery centres are yet to come up. Also, second-generation reforms are yet to move beyond the drawing board.

Despite a good infrastructure, the delivery of health services remains zilch. The budget has earmarked R3,443 crore for upgrade of infrastructure and human resource.

With the state's groundwater table fast depleting, the budget has unveiled the strategy to increase the canal capacity and utilize surface water for irrigation. As the Centre has cold-shouldered Punjab's demand for a R3,000-crore package for remodeling its worn-out canal system, the state has now earmarked R1,100 crore for the purpose.

The FM's numbers hide more than they reveal. Painting a positive picture, the budget has promised 15% jump in the proposed annual plan outlay for 2013-14, taking it to R16,123 crore. A look at its showing in the current fiscal and the truth comes out. His government is struggling to achieve 60% plan expenditure.

'A vision document', 'the dream of New Punjab', 'mature guidance of Parkash Singh Badal' and 'dynamism of Sukhbir Singh Badal' are the eye-catching key words in Dhindsa's opening remarks.

Laptops with data cards, employability allowance, more free power, cheaper atta, wi-fi cities etc - the SAD-BJP alliance promised a largesse in the run up to the 2012 assembly polls. Lacking in financial wriggle room, they are now cutting corners - tablets is what they are talking about now instead of laptops. Commitments have been largely given the go-by in the budget.

Dhindsa's bland budget speech lacked Manpreet Singh Badal's delightful oratory peppered with Urdu and Persian couplets. Nor did it have Manpreet's heartfelt clarion call for pulling the state out of the fiscal morass. The former finance minister spent his day in his native Badal village, giving the media sound bites on the budget.

This dream project of Bathinda MP and Sukhbir's wife Harsimrat Kaur figures on top of a string of initiatives for women empowerment outlined in the budget. Now, it gets a R10-crore leg up from the government in the form of a new scheme 'Nanhi Chaan scholarships' for girls belonging to 'atta-dal families'.

This budget will go down in the history of Punjab assembly for an inglorious reason. The opposition Congress stayed out of the House all through, depriving the session of all the sound and fury that goes with such occasions.

The budget reiterated Sukhbir's much-touted ambitious plan to make Punjab a power-surplus state by March 2014. However, with some of the upcoming thermal projects running behind schedule, keep your fingers crossed.

Competitive populism saw the Akalis and the Congress trying to outdo each other in promising doles ahead of the assembly polls last year. In its enthusiasm, the ruling SAD promised to raise the pension for the elderly, widows and the disabled from Rs 250 to Rs 800 per month in its manifesto. In the same document, it promised to raise it to Rs 500 per month. However, there is not a word on the raise in the budget.

A matter of concern for a long time, this is one parameter of fiscal consolidation recommended by the finance commission that the state has been finding it difficult to meet due to economic slowdown. Now, it has set an ambitious target of 0.57% in the budget for the coming fiscal, but will have to meet its resource mobilisation targets.

Ballooning subsidies have compounded the government's troubles. Power subsidy, which accounts for bulk of the subsidies' bill, has jumped from Rs 4,200 crore in 2011-12 to Rs 5,785 crore in the budget for 2013-14. Though there is a growing demand to limit free power to small farmers in the state, the Akali big guns mostly skirt the issue. At times, they even justify free power to big farmers.

In the populist mode, Dhindsa has shunned serious resource mobilisation efforts. Though the financing of the annual plan of Rs 16,123 crore requires additional resources, the FM is banking on belt-tightening, adopting austerity measures and better tax administration and compliance.

Rapid urbanisation requires unstinted support. With 38% of the state having become urbanised, the FM has focused his attention on urban areas and the challenge of providing civic amenities to millions of town dwellers, promising to establish 50 urban estates in different towns for planned and quality housing facilities. Rs 8,888 crore have been earmarked for providing 100% basic civil amenities. Also, the 'safe city' project has been proposed for Amritsar and Ludhiana as an "overall security solution".

V: Value-Added Tax (VAT)
Amid the darks clouds, VAT is like a silver lining, clocking impressive growth in recent years. After an expected 34% growth in the current fiscal, the government is hopeful of doing an encore. In his budget speech, the FM even congratulated his boss, deputy CM and SAD president Sukhbir Singh Badal, and taxation officers for the jump in collections. But the concerns about leakages remain.

Big cars, plush offices, a new flying machine, foreign trips, tax liability of ministers, a jumbo team, favorites inducted with cabinet rank etc - a pampered lot, politicians and bureaucrats continue to have a cozy life at the cost of the state exchequer. Never mind the fact that the government is stretched sometimes to pay salary to its employees. The FM has talked about austerity, though.

The budget has been tailormade with an eye firmly on the next Lok Sabha elections. With the UPA government looking wobbly, the ruling coalition has calculated the parliamentary polls could happen earlier than 2014 and has skillfully tried to make it a "please-all budget" with no significant tax burden.

A year after they promised employability allowance, the Akalis have just made a nominal allocation in the budget. But there are several things for the youth, including scholarships for upcoming sportspersons, new employment generation opportunities, a marine academy at Rupnagar, a training centre for security guards and new government colleges.

All in all, Dhindsa has not taken a leap forward in his second budget. There are no definite, tough measures for resource mobilisation required to pull the state out of its present financial crunch. While the FM has talked of austerity and belt-tightening, no measures have been outlined. The VAT rates have been tweaked slightly to raise Rs 180 crore from smokers and soft drink-guzzlers. Similarly, the relief to children, women and senior citizens has been nominal.

First Published: Mar 21, 2013 00:16 IST