Budget 2020

‘Not a Vote on Account but an Account for Votes’

New Delhi | Updated on February 01, 2019 Published on February 01, 2019

With no hope of returning to power, govt is desperate and reckless, says former finance minister P Chidambaram

In a statement issued at the AICC headquarters, former finance minister P Chidambaram, says on the interim Budget:

“My one line comment on the Budget is, it was not a Vote on Account but an Account for Votes.

“The Interim Finance Minister tested our patience by the longest Interim Budget Speech in recent memory. It was not an Interim Budget. It was a full-fledged Budget accompanied by an election campaign speech. By doing so, the government has trampled on time-honoured conventions. A government confident of returning to power would have respected the conventions. It is crystal clear that the government has no hope of returning to power and has, therefore, acted desperately and recklessly, and in violation of the Constitution.

Fiscal stability weakened

“The big takeaway is that the present government has further weakened fiscal stability. For the second year in succession, the government has missed the Fiscal Deficit target. The revised estimate shows a slippage from 3.3 per cent to 3.4 per cent. Worse, for 2019-20 too, the government has proposed an FD of 3.4 per cent. The government has thrown the FRBM Act out of the window.

“Similarly, the government will end the year with a Current Account Deficit of 2.5 per cent as against the CAD in the previous year of 1.9 per cent. “Both numbers for the current year and the estimate of FD for 2019-20 point to incompetent fiscal management and disdain for fiscal prudence.

Last-gasp announcements

“Let’s now look at the announcements: all of these are last-gasp announcements by a government whose term will effectively end in about 90 days.

“First, suddenly, the government has remembered the cows and announced a scheme for their welfare and provided a grand sum of ₹750 crore. Second, it has announced the setting up of a new Department of Fisheries. Third, it has announced a new contributory pension scheme for 10 crore unorganised workers that promises a pension of ₹3000 per month on their attaining the age of 60 years and allotted a paltry sum of ₹500 crore. “The question that naturally springs to one’s mind is ‘if these were important and necessary interventions, what was the government doing for five years?’

“The government’s desperation is proved by its announcement of the Farmers’ Income Support Scheme to provide a measly sum ₹ 6,000 per year to every small/medium farmer. The Fiscal Deficit numbers are telling. By recklessly breaching fiscal discipline, the government will fund the Scheme this year entirely out of borrowed money of ₹20,000 crore and ₹75,000 crore next year. While I welcome the support to farmers, I ask what about the non-farmer poor? What about the urban poor?

“The new scheme is intended to help the farmer, but in reality, it will also help the absentee landlord.

“I have no doubt in my mind that the Congress’ announcement of a Minimum Income Guarantee will bring true relief to all the poor households/families.

Tall claims

“Every report from the field has exposed the false claims made in respect of ODF-free villages, domestic electricity connections, use of LPG cylinders and Mudra loans. None of the numbers put out by the government is true, but the government is so blinded by the dazzle of its fake numbers that it is not able to see that thousands of toilets that were unusable; thousands of villages and millions of homes that do not get electricity.

“The direct tax concessions were beyond the authority of the government that will lay down office in 100 days. They seem to have been added at the last hour.”

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Published on February 01, 2019
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