The state government has kicked off preparations for the state budget 2024-25, by issuing guidelines to all the departments to prepare estimates of revenue receipts and expenditure, even as there is an increasing pressure on Chief Minister Siddaramaiah, to look beyond the five guarantee schemes and invest in other development projects.
The drought in state this year, the pending bills of contractors in the state tuning up to an estimated Rs 20,000 crore and the government’s commitment to fill vacant posts across departments, add to the pressure.
These estimates, part of the annual standard operating procedure, will allow the government to assess the financial situation of the state and draft the budget.“There is definitely pressure on the government to look beyond the guarantees. We will get a clearer picture by December on how funds can be mobilised,” a Finance department official told DH.
A section of its own MLAs are disgruntled with the Congress government over fund crunch. The opposition legislators have alleged that the government has cut funds to their constituencies. Recently, RR Nagar MLA Munirathna staged a protest and even fell on the feet of Deputy CM D K Shivakumar, seeking funds for his constituency.
Political analyst and economist Narendra Pani pointed out that by standardisingfive guarantee schemes, the emphasis is on the Congress party and not on individual MLAs. With this, the MLAs lose power at the local level. The ruling party has the challenge of managing this political conflict.
The government needs to ensure availability of Rs 52,000 crore next year for implementation of the guarantees alone. “There is a minimum of a 15 per cent growth in the budget every year. The GDP is seeing an encouraging growth. This, coupled with measures such as revision of guidance value and giving out mining leases, will help shore up revenues. We are optimistic that we can give additional funds next year,” sources in the chief minister’s office said.
In addition, the government is likely to look at the centrally sponsored schemes to take up projects outside the guarantees, sources added.
Madhusudhan B V Rao, Lead, Public Finance and Decentralisation at the Centre for Budget and Policy Studies, also shared an optimistic view. “The growth of own tax revenues is at a healthy growth rate of over 15% over the last year (up to August 2023). The borrowings have been kept to minimum in the last six months (Rs 871 crore till August) which gives good elbow room to optimise the spending closer to end of financial year,” he observed.
In addition, the increase in GSDP and tax revenue would help in getting increased share of taxes from the Centre, and give a higher elbow room for borrowings. Overall, Siddaramaiah, who is also the finance minister, seems to be gauging the expenses very closely and has a greater task at hand especially in the wake of coming general elections which is closer to the state budget, Rao added.
(Published 27 October 2023, 01:05 IST)