Money blues force Maharashtra govt to go on budget backfoot

Restrained by the farm loan-waiver burden, the salary hike promised to 18 lakh employees under the 7th pay commission, Maharashtra’s finance minister Sudhir Mungantiwar tabled the most plain-vanilla of his four budgets in the state legislature on Friday.

It had no big-bang announcements, no big-ticket projects for Mumbai or the state and no game-changing policies.

The only good news is the budget will not pinch your pocket. With the roll out of the Goods and Services Tax (GST) and with an eye on the upcoming state elections, the state did not introduce any new indirect taxes or levies, and the minister even shied away from hiking excise duty on alcohol, a staple measure to mop-up resources.

With an allocation of Rs10,000 crore for the farm loan waiver; Rs10,000 crore for salary hikes; and Rs11,804 crore committed to local bodies as Goods and Services Tax (GST) compensation – beyond its wage bill and administrative costs — the state’s 2018-19 budget had little scope for new initiatives.

The budget, with a revenue expenditure of Rs3.01 lakh crore, tried to maintain a status quo by allocating resources to ongoing projects in its priority areas – agriculture and allied sector (Rs18,112 crore); irrigation (Rs8,685 crore); and road development and transport (Rs12,857 crore). The state evidently maintained a farmer-centric appro-ach given the agrarian crisis has been a chink in BJP’s armour.

The budget made provisions of Rs922 crore for subsidised wheat and rice for below poverty line (BPL) farmers in 14 districts; Rs1,500 crore for the flagship Jalyukta Shivar scheme to make villages drought free; Rs100 crore for organic farming; and Rs750 crore for agriculture pumps, among other announcements.

Mungantiwar announced implementation of the 7th pay commission recommendations from this year. A move that will benefit around 18 lakh state employees, including 7 lakh pensioners.

In a bid to woo the youth, the budget announced setting-up of a new skill development centre (under the new start-up policy) and district-level competitive exam centres. However, none of these measures have been backed by specific monetary allocations.

Beyond this, the finance minister has used the limited elbow room he had to announce several small and big populist dole-outs to appease different communities and sections of the state.

With elections expected to be held within a year, the sops include a new scheme to provide basic facilities in settlements of scheduled tribes and Neo Buddhist communities to a welfare corporation for 20 lakh auto rickshaw drivers and increasing pensions for the differently abled from Rs600 a month to Rs800-Rs1,000 a month.

As a token gesture, the state also allocated Rs300 crore and Rs150 crore to the proposed Shivaji memorial in the Arabian Sea and the Dr Babasaheb Ambedkar memorial at Indu Mills, respectively.

Many announcements, however, were mere repetition of the policies announced earlier in the year.

“Despite constraints, we have increased the annual plan (development spending) by 23 per cent to Rs95,000 crore this year,” said Mungantiwar. “This budget has tried to chart out the state’s direction to a trillion-dollar economy by increasing growth in sectors like agriculture, textiles, start-ups, tourism and infrastructure. The bid is to increase our growth rate in service sector.”

The finance minister said that through the budget, he had tried to reach out to the disadvantageous sections of society, from tribals to the differently abled.

The Opposition, meanwhile, slammed the government for making a lot of “empty announcements” without backing them with any allocation. “This budget shows that the Fadnavis-led government in just four years has got the state to its worst-ever financial situation,” said Ashok Chavan, Congress’ state unit chief.

“The revised revenue deficit for 2017-18 has been reworked from Rs4,511 crore to Rs14,843 crore. The deficit for this year is Rs15,374 crore. One can only wonder how much will the 2018-19 figure get revised to considering the entire burden of the salary hike has not been accounted for.”

A senior BJP minister, on the condition of anonymity, said, “Within the available space, we have tried to make several constituents and constituencies happy. At the end of the day, elections are close-by. For instance, by announcing Rs2,000 crore for rural roads, most legislators in rural areas can reach out to the last-mile voter.’’