The Hindu Business Line : Kerala plans switch to `impact Budget'

The Kerala Government is planning to switch to `impact Budget' preparation that will analyse the macro-economic implications of each proposal contained in the Budget.

The Finance Minister, Dr Thomas Isaac, said in the Assembly on Wednesday that such a practice would help the Government put the resources at its command to the optimum benefit of the State and its people.

In the new exercise, the House would be informed of the cost of each proposal in the Budget and the larger logic of the sacrifices it would be constrained to make for lack of resources.

DEFICIT

Replying to discussions on supplementary demands for grants for various departments, Dr Isaac said that the overall Budget deficit for the current year would go up from the original estimate of Rs 761 crore to Rs 881 crore as a result of the concessions and waivers announced in the Assembly during the passing of the Finance Bill. The House passed supplementary demands to the tune of Rs 481.43 crore.

The Minister said that he did not visualise a situation wherein the Government would be pressed to opt for a cut in Plan size for the current year due to resource constraints.

However, this would depend on whether the State Government would be able to raise a loan of Rs 7,200 crore to the finance the Plan.

The Centre had allowed the State to borrow Rs 7,200 crore this year following a strong representation from the Government. But the borrowing from small savings schemes was set to come down by around Rs 1,600 crore.

While allowing the State's request for restoring the borrowing ceiling, the Centre had imposed a condition that the shortfall in receipts from the small savings schemes should not be made good through borrowings from other sources, the Minister said.

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