Bhopal: Cheaper LPG cylinders, free electricity, two-wheelers for students, and a monthly allowance for women. With assembly polls in Madhya Pradesh around the corner, subsidies and welfare schemes are the sweetener of the season with both the ruling Bharatiya Janata Party (BJP) and its primary challenger, the Congress, banking on them to woo voters. The Congress, though, seems to have one foot on the brakes, given that it has not announced any new poll-related subsidies or schemes in Madhya Pradesh in nearly a month.
According to the state government, Chief Minister Shivraj Singh Chouhan made three new announcements daily on average since assuming office in March 2020. On its part, the Congress has now promised voters 100 units of free electricity, LPG cylinders at subsidised rates and resumption of the Old Pension Scheme (OPS) for retired government employees if voted to power in the assembly elections slated for later this year.
But with the state reeling under an estimated debt of Rs 3.26 lakh crore, fiscal prudence too has become a poll plank with the Congress accusing BJP of adding to the burden of the exchequer. The state’s fiscal deficit, according to budget documents (FY 2023-24), is an estimated Rs 55,708 crore — 4 percent of the gross state domestic product (GSDP).
On Tuesday, Congress leader Digvijaya Singh alleged that government money was “being diverted for BJP’s election agenda,” and warned officials in the state finance department to look out for the ballooning deficit. “Top officials in the finance department are further damaging the state’s already shaky financial condition to fulfil the BJP’s agenda,” he said.
The Rajya Sabha MP and former chief minister alleged that nearly “137 schemes” have been stopped and funds for many others are being withheld.
“I warn the erring officers that after the Congress government comes to power, these activities will be thoroughly investigated and strict action will be taken against erring officers, no matter the seniority,” he said.
Chouhan, while addressing a public meeting later in the day, cited Singh’s remarks to say that the Congress was “scared”:
“Digvijaya Singh threatened officials of the finance department, and asked them where the money was coming from. When Kamal Nath was chief minister for a year-and-a-half, he kept on crying about not having money.
“But here I am, saying that there is enough and more money. If one cries about there being no money while sitting on the chief minister’s chair, why were you sitting on it?”
As for experts, they say that while the state government is “dangerously close” to breaching the fiscal limit, schemes such as cycles for students living in rural parts of the state “go a long way” towards benefiting the entire family.
“When looking at freebie culture, one has to see if the freebie is in the form of a cycle given to a student in a rural area. One does not support the freebie culture, but in such a situation — a freebie in the form of a cycle — it will go a long way in benefiting the student or the family,” says Amitabh Kundu, professor emeritus at Ahmedabad’s LJ University.
He, however, also says that when looking at this in the context of the state’s financial health, “not all schemes are continued throughout and often in the fine print of the schemes, one finds many sections of society are not eligible to avail of these schemes”.
“Therefore, while the cost to the state might appear to be huge, when it comes dangerously close to breaching fiscal limits, there are often bureaucratic manoeuvres that are enforced,” Kundu adds. Quoting Nobel laureate Amartya Sen on the nature of poll promises, he says, “Kam se kam ek baar toh voters ke baare mein sochte toh hain. (At least for once, politicians think about voters.)”
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Madhya Pradesh’s debt
As of 31 March 2022, Madhya Pradesh’s overall public debt stood at Rs 2.95 lakh crore, which swelled to Rs 3.26 lakh crore this year, according to the budget estimates (for FY 2023-24). The figure is estimated to swell further to 3.85 lakh crore by 31 March, 2024.
In June this year, Finance Minister Jagdish Devda informed the assembly that the state government had secured loans to the tune of Rs 16,000 crore between June 2022 and February 2023. Then, fresh loans amounting to Rs 10,000 crore were secured in multiple tranches between February and June to meet the government’s expenses.
Despite Prime Minister Narendra Modi’s criticism of ‘revdi’ culture, the state BJP has already announced direct cash transfers to women under its Ladli Behna Yojana, subsidised LPG cylinders and free electricity, among other such schemes.
According to a reply by the state’s General Administration Department (GAD), CM Chouhan made 2,715 announcements between 6 June 2020 and 9 June 2023 — averaging 2.5 per day. The government, in its reply to a Congress MLA’s question, revealed that this included 489 announcements in 2020, 878 in 2021, 753 in 2022 and 595 until June this year.
Under the Ladli Behna Yojana, announced this March, an estimated 1.25 crore women in the state were eligible to receive Rs 1,000 per month as allowance. After the Congress promised to hike this allowance to Rs 1,500 if voted to power, Chouhan raised it to Rs 1,250 on Raksha Bandhan and promised to gradually increase it further to Rs 3,000 a month.
For this scheme, an allocation of Rs 8,000 crore was made in the state budget (for FY 2023-24). However, the government will need to allocate Rs 1,800 to Rs 2,000 crore each month in order to be able to transfer Rs 1,250 to each of the scheme’s 1.25 crore beneficiaries.
Reacting to Congress’s poll promise of LPG cylinders at a subsidised rate of Rs 500 apiece, the BJP also announced earlier this month that it would provide LPG cylinders for Rs 450 apiece. And while the Congress promised 100 units of free electricity and consumption of up to 200 units at half tariffs, the BJP offered to defer electricity bills issued in line with hiked tariffs, along with free electricity to women in the state living under the poverty line.
Chouhan in June announced a hike in the honorarium of nearly one lakh Anganwadi workers to Rs 13,000 from the earlier Rs 10,000, and a decision to double the honorarium for government employees from Rs 9,000 to 18,000. He also announced a threefold rise in the honorarium for district panchayat presidents, vice presidents and deputy sarpanches, besides the regularisation of 1.5 lakh contractual employees. The government also made a provision of Rs 135 crore in the state’s budget (for FY 2023-24) to fulfil its promise of providing e-scooters to government school students who top the Class 12 exam.
Asked to comment on these moves, Kanhaiya Ahuja, head of the department of economics at Indore’s Devi Ahilya University, says, “Some of the schemes termed freebies are in fact viewed as social welfare schemes that give their beneficiaries much-needed support. This is also how Ladli Behna Yojana was visualised. But the MP government is dangerously close to breaching its fiscal limit and has to be mindful of its expenses.”
Congress says ‘waiting for MCC’
The Congress, on the other hand, is now taking a more cautious approach in the sense that it has not made any new poll promises over the past month. Addressing a press conference in Bhopal on 2 September, party general secretary Randeep Singh Surjewala said he had told state Congress chief Kamal Nath, “Aap sahi waqt ka intezaar kijiye (wait for the right time).”
“Jab inke (BJP) haatho mein aachaar sanhita ki hathkadiya lag jayengi, fir uske baad Kamal Nath ji ka pitara khulega, Congress ka pitara khulega. Aur fir Madhya Pradesh ka bhavishya badlenge,” said Surjewala, who is also the party’s in-charge for the state.
(Once the handcuffs of the Model Code of Conduct are slapped on the BJP, then Kamal Nath ji will open his chest, the Congress will open its chest. And then the future of Madhya Pradesh will change for the better.)
The Congress’s Tarun Bhanot, while addressing a press conference in Bhopal on 27 August, had circulated a list of 130 state schemes across 40 government departments, alleging that funds were allegedly not being released for these schemes owing to budgetary constraints. A former state finance minister, he had also alleged that the Chouhan government, via an order dated 21 August 2023, had deferred the disbursal of Rs 144.20 crore earmarked for the renovation of 6,696 elementary and 493 middle schools in the state.
Nearly 20 lakh beneficiaries of social security schemes, including widows and specially-abled individuals availing of pensions, have been affected as a result of not receiving monthly assistance of Rs 600 for the past two months, he alleged.
(Edited by Amrtansh Arora)
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