In a record three hour-18 minute speech that seemed to strain the patience of even the treasury benches, finance minister Dr Thomas Isaac presented the 2021-22 Kerala budget (the last budget of the outgoing LDF government and his 12th) that was clearly designed with the upcoming assembly polls in mind.
There were generous proposals (read sops) meant for targeted groups, though the populism was largely masked with buzzwords like ‘knowledge economy’ purportedly meant to address the issue of unemployment among the educated youth but which, in reality, entails a rosy proposal without much actual spending.
Isaac, who started his budget speech with some dreamy verse penned by a seventh-standard student, ended it with chestthumping rhetoric on how the Pinarayi Vijayan government had demonstrated the role of a true government, and one that had won the people’s faith as well. The tone was triumphalistic all through – more suitable for a political podium than a budget speech -- and seemed to presume that this government was more than assured of a five-year second term in power.
Of course, the progressive nature of Isaac’s previous budgets over the last five years was visible in the 2021-22 budget too. The ‘gender budget’ got 19.54% allocation, higher than the previous budget. Schemes to promote e-vehicles and green building technology will encourage more people to switch to clean energy methods.
Similarly, with internet being declared as a basic right and K-FON project all set to address the issue of connectivity even in remote corners of the state, what Isaac needed to do was to find a smart catalyst -- free internet for BPL families, laptops provided at subsidised rates and a network of co-working space managed by local bodies, he declared, can usher in the next generation of outsourcing business in a decentralised manner in the state.
The budget was ominously silent – but no real surprise there considering the looming elections – on any additional revenue generation plans. In fact, there is an estimated revenue loss of Rs 191 Cr through fresh tax waivers resulting from generous grants while dealing with salary, social welfare pensions and honorariums. State government employees are assured of pay revision from April along with the announcement of two pending DA instalments. Honorarium for local body members, Asha workers and CDS chairpersons have been hiked. Journalist, non-journalist pension and pension for anganwadi teachers and helpers were also hiked along with Rs 100 per month hike in all social welfare pensions. Subsidised rice of 10 kg per month at Rs 15 per kilogram will be given to APL ration card holders.
All these are done when the budget documents paint a very grim picture of the state’s finances. The outstanding debt for the state has been estimated to be Rs 3.28 lakh crore at the end of 2021-22. This will be 37.4% of GSDP and about twice as the debt liability in 2016 when the LDF government occupied office. Out of the total projected revenue expenditure, 27% will be for salary, 16% for pension and 15% for repayment of interest. That means only 42% of the revenue can be used for constructive purposes.
The tall promise of 20 lakh jobs in five years was made by foreseeing the need of big and medium tech companies, hit by Covid-19, to trim their budget and look for new outsourcing models for their core businesses.
After the proposed revamping in line with the restructuring of KIIFB, K-DISC will act as an effective catalyst for realising this.
Focussing on higher education sector and getting all teenagers enrolled for skill development and higher education courses was another highlight of the budget, a natural progression for a state which has already achieved the target of universal primary education.