A tweet by Tamil playwright and public intellectual Indira Parthasarathy on the Tamil Nadu budget and the way it went viral epitomizes the public’s perception of the budget as a whole. Professor Parthasarathy, known to frequently comment on political events, The budget is described as “micro, broad-based and people-oriented”., But for the ruling DMK’s critics and supporters, what was more surprising was the budget itself, the regime’s first budget for the entire financial year (2022-23).
Supporters were surprised by the absence of any dramatic announcement of freebies. There was no word on the restoration of the old pension scheme for government employees, which was promised by the ruling party during the 2021 assembly elections. Critics were surprised as the DMK, which came back to power in 2006 on assurances of free distribution of color TV sets and cooking gas stoves, was showing a tendency towards rationalization of subsidy distribution.
The budget sends a clear message that the government is conscious of the challenges ahead. The impact of the Russo-Ukraine war, expected rise in inflation and interest rates, the COVID-19 pandemic, uncertainty over the continuation of compensation to states for the implementation of GST and the potential for monetary losses, and absorption of the entire loss-making power utility of the perennial loss , Tamil Nadu Generation and Distribution Corporation, from 2022-23 all get a mention in the budget. Taking these factors into account, the government conservatively anticipates only 17% growth for the next year with respect to the state’s own tax revenue (SOTR), which accounts for 60% of its total revenue receipts. However, it has projected a growth rate of around 25% for 2023-24. Interestingly, since 2006, the growth rate of SOTR has crossed the 20% mark only twice.
However, the government is optimistic about the progress on the financial front in two years in the backdrop of ‘achieved’ in the current year. As Finance Minister Palanivel Thiaga Rajan said in his budget speech, this year “the absolute level of the revenue deficit will reduce by over Rs 7,000 crore. [vis-à-vis the previous year, a COVID-19 year]reversing an alarming trend of increasing deficit every year since 2013-14″. The Government is enthusiastic about achieving substantial gains in cost savings through measures including the Data Purification Project, thereby allowing ineligible persons from the purview of welfare schemes. expected out.
This year’s budget is remarkable for many other reasons. It is also seeking a payment of ₹1,000 in a month to the existing marriage assistance schemes to promote higher education for girls directly into their bank accounts, provided they have studied classes 6 to 12 in government schools and have a bachelor’s degree. , Join Diploma and ITI courses. , The candidate will get assistance till the completion of his/her course without any break. The emphasis of the government is to ensure that its welfare schemes reach only the real beneficiaries. This DMK regime is trying to mark a change in the party’s approach towards subsidies, as universal use of subsidies was also the cry of the DMK and AIADMK.
In a much needed push to the construction industry, the government has decided to increase the existing floor space index in areas adjacent to the alignment of metro rail, suburban rail, national highway and bypass. Landowners have also demanded a similar measure on the East Coast Road. It remains to be seen how long the DMK regime is able to firmly maintain its position on fiscal consolidation, without compromising on the concept of welfareism.