The Hindu Business Line : TN to spend more on social sectors

Focus areas
Revival of agriculture, targeting 100 pc literacy in the secondary education level;
Skill upgradation to support the manpower requirement of the manufacturing sector;
Bringing down the inter-district disparity in human development.

Chennai , Nov. 21

Tamil Nadu's primary focus during the 11th Plan (2007-12) is to enhance expenditure in social sectors, while pushing for revival of the agriculture sector and small-scale industries, according to the approach paper presented by the State Planning Commission.

Addressing a press conference after presenting the approach paper to the Chief Minister, Mr M Karunanidhi, the Vice- Chairman of the State Planning Commission, Dr M. Naganathan, said that the Central allocation was key to supporting the State's expenditure in education, health and rural development.

Expenditure in these social sectors had increased by about 15 per cent in the last decade against 20-30 per cent in other sectors. Expenditure to education, health and rural development accounted for about 25 per cent of the annual budget. Tamil Nadu's expenditure in the social sector though higher than the national average was still less than 2 per cent of the State's GDP. The State needs to push for higher allocation of the Central tax revenue to support social development, he said.

The State Government needs to convince the Centre to share 50 per cent of its net tax revenue with States rather than allocating 29 per cent of the gross tax revenue, the current practice, he said.

States own tax revenue is constrained by harmonisation of taxes, limitations on powers to impose new taxes and fiscal responsibility commitments that curtail borrowing. Tamil Nadu's manufacturing sector has not grown as fast as communication sector, financial services, and real estate, which offer limited options for tax.

Poverty reduction

According to the NSS data, the percentage population below the poverty line is about 22 per cent (1.40 crore) in Tamil Nadu. The Government has set itself a target of bringing this down by 10 percentage points. The broad objective of the approach plan is for economic and equitable growth.

Revival of agriculture, targeting 100 per cent literacy in the secondary education level and skill upgradation to support the manpower requirement of the manufacturing sector and bringing down the inter-district disparity in human development were among the focus areas for the 11th plan, Dr Naganathan said.

More farmer credit

Among the suggestions for revival of agriculture the Planning Commission has said that enhancing access to credit for the farmer, infusion of fresh capital and democratisation of the co-operative banks are key.

The Government should consider setting up a Water Resources Management Authority to oversee and regulate water use.

Manpower shortage

The Planning Commission has pushed for infrastructure upgradation, power sector improvement and simplification of procedures to encourage industry.

Programmes are needed to upgrade manpower skills to tackle the shortage in the textile, garment and construction industry. Information technology development should be broad based by extending the network into the rural areas.

Dr Naganathan said that the approach paper is open for public debate and expert opinion. The Planning Commission has constituted 14 Steering Committees and 38 Working Groups to come up with sectoral plans. A final version would be ready in six to eight months.