As revenues drop, Telangana decides to go in for mid-term Budget review

HYDERABAD: The State government has decided to go in for the mid-term review of 2020-21 Budget as the State’s revenues have dipped due to the Covid-19 pandemic. Funds expected from the Central government too have not been received by the State. The financial situation up to September, the half-year period, is also not very encouraging, necessitating Chief Minister K Chandrasekhar Rao to go in for a review of the State Budget.

In the first five months of the year, the State’s Revenue Receipts were just 21.68 per cent. As against the estimated revenue of Rs 1,43,151.94 crore for the year, the State realised Rs 31,037.47 crore up to August, just 21.68 per cent of the estimated revenue. If the trend continues like this, the State Budget size may be downsized by 30 to 40 per cent.

The State’s share in Central taxes was estimated at Rs 10,906.51 crore for the year. However, the State received only Rs 3,125.03 — 28.65 per cent — up to August. With fall in its State’s Own Revenue (SOR) and also less grants from the Centre, the State is mostly depending on the loans to honour its commitment to implement the welfare activities. 

As the situation remains grim, the government decided to review the situation. Even the GDP of the Central government was -24 per cent and its impact would be felt on the States, the Chief Minister said. 
Rao asked the officials to make a fresh assessment of the availability of funds. “Assess how much is actually available for the government to spend. Also assess, how much we can release to different departments. Review the Budget and submit a report,” he said.

Finance Minister T Harish Rao presented Rs 1,82,814.42 crore Budget for 2020-21. Despite, the economic slowdown and poor prospects of receipts from the Centre, Harish Rao’s maiden Budget was 25 per cent bigger than the 2019-20 Budget size. After Harish Rao presented the Budget, the situation turned more difficult with the outbreak of Covid-19 pandemic. It remains to be seen, whether this year’s Budget crosses Rs 1.5 lakh crore mark or not.

‘Make fresh assessment of funds’
CM KCR asked the officials to make a fresh assessment of the availability of funds. “Also assess, how much we can release to different departments. Review the Budget and submit me a report.”

State govt employees to be paid DA dues
Chief Minister K Chandrasekhar Rao on Friday directed the Finance Department officials to immediately pay Dearness Allowance (DA) dues, pending since July 1, 2019, to the State government employees. Rao also asked the officials to evolve a policy on payment of DA immediately after the Central government announces the DA. As per the directions of the Chief Minister, Principal Finance Secretary K Ramakrishna Rao issued a GO revising the DA points from 33.536% to 38.776% to government employees and from 118.128% to 126.688% for pensioners from July, 2019.

During an interaction with the leaders of Telangana Employees JAC, the Chief Minister felt that the policy of announcing the DA for State government employees should be changed. There should not be any delay in announcing the DA points, Rao said. The CM also assured that he would have a meeting with the leaders of employees unions to discuss and resolve their problems.