New Delhi: The Centre has sought permission from Parliament to enhance spending for the year by a little more than Rs 58,000 crore, with about a third of this being allocated to subsidies on fertilisers and food, an analysis of the government’s submissions to the Lower House showed.
The government Wednesday laid before the Lok Sabha the first batch of its supplementary demand for grants for the financial year 2023-24. A supplementary demand for grants basically lays out the government’s additional spending requirements, as well as its plans to reallocate resources it had already committed in the fiscal Budget from one scheme to another.
According to the documents, the proposals involve a net cash outgo of Rs 58,378.21 crore and “gross additional expenditure, matched by savings of the ministries and departments or by enhanced receipts” of Rs 70,968.15 crore.
In other words, the government expects it will have to spend an additional Rs 58,378.21 crore over and above what was allocated in the Budget announced on 1 February this year.
The other Rs 70,968.15 crore of additional spending will be financed using money it has saved in other areas, or surplus revenue it has generated. That is, it will not involve actual additional expenditure, just a reallocation between schemes.
That said, this additional spending and reallocation does provide some insight into the government’s priorities. For example, the government has sought permission to allocate an additional Rs 43,155.09 crore for subsidies and employment generation schemes.
However, not all of this enhanced allocation will need additional spending, since some will be reallocated from other schemes.
Fresh spending on fertiliser, food subsidies
The government has sought permission to spend an additional Rs 13,350.81 crore on the nutrient-based fertiliser subsidy scheme, which would amount to a 30 percent increase over what was budgeted for it.
Similarly, it has sought permission to spend an additional Rs 5,500 crore on the free food programme ‘Pradhan Mantri Garib Kalyan Anna Yojana’, a 2.8 percent increase in the budgeted food subsidy bill for the year.
In total, the additional spending allocated to fertiliser and food subsidy, of Rs 18,850.81 crore, works out to 32.3 percent of the additional spending the government is requesting to make.
Reallocations for employment & LPG subsidies
Apart from this, the government has also asked for an additional Rs 14,524.29 crore for the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS), which includes the Rs 10,000 crore emergency allocation made to it earlier this year. Overall, the government expects to spend Rs 16,142.86 more on MGNREGS this year.
This would take the total MGNREGS bill for the year to Rs 77,175.51 crore, which is still lower than the Rs 89,154.65 spent last year, according to the revised estimates.
The additional spending this year on MGNREGS, however, will be met through its internal resources — either reallocated from somewhere else, or financed through increased revenue — and will not entail actual additional cash outgo.
Similarly, the government has allocated an additional Rs 1,280 crore for the LPG subsidy it provides through direct benefit transfers (DBT), and Rs 8,499.99 crore for providing LPG connections to poor households.
(Edited by Tikli Basu)
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