Free power, health boost, edu push: Aam Aadmi at heart of AAP budget
No new taxes in Mann govt’s first budget, focus on poll promises
CHANDIGARH: Presenting its maiden budget after storming to power three months ago, the Aam Aadmi Party (AAP) government in Punjab on Monday focused on fulfilling its ‘poll guarantees’, allocating funds for 300 units of free electricity to domestic consumers, free delivery of atta and hiking the budgetary allocations for health and education sectors.
Finance minister Harpal Singh Cheema, who presented the Rs 1.55 lakh-crore budget for financial year 2022-23 with no new taxes, has earmarked a subsidy of Rs 6,380 crore for free power to domestic category consumers under various schemes. The existing subsidy for other free power-related schemes has been subsumed into the new scheme. The 300 units of electricity a month to all households free of cost is slated to start from July 1.
The new scheme will take the state’s power subsidy bill to Rs 15,830 crore, including Rs 6,947 crore for agriculture sector and Rs 2,503 crore for industrial consumers. “This (free power) will bring big relief to Punjabis, who were reeling under exorbitant power bills. I have planned to finance this scheme by cutting wasteful expenditure and through enhancement of our own revenue,” Cheema said while present the first-ever ‘paperless budget’.
Allocation for health, education up
Besides Rs 497 crore for doorto-door delivery of atta (wheat flour) to 1.58 crore beneficiaries under the Smart Ration Card Scheme, the finance minister also hiked the budget allocation for health and education sectors, allocating funds for schemes including Rs 77 crore for 117 mohalla/pind clinics, Rs 200 crore for schools of excellence, Rs 30 crore for skill-gradation of teachers, Rs 2,000 per student for Youth Enterpreneur Programme.
The budget is silent on another major poll promise of giving Rs 1,000 a month to every woman. Cheema later said that out of five guarantees, four – giving 300 units of free electricity, quality education, improving health infrastructure and raising compensation to families of martyred soldiers—have been fulfilled. “The government will soon fulfill the guarantee of Rs 1,000 after consolidating the fiscal position,” he told reporters at the finance minister’s customary post-budget press conference. He also told reporters that providing free 300 units of free power will put an additional burden of Rs 1,800 crore on the state exchequer.
In the run up to the Punjab elections, the AAP had promised free electricity, doorstep delivery of wheat flour and quality education and health services and the state government has based several of these programmes on the Delhi model where the party is in power. Delhi deputy chief minister Manish Sisodia, who handles the finance portfolio, was also present in the speaker’s gallery when Cheema delivered his budget speech.
Thrust on revenue augmentation
At the very outset in his speech, the finance minister, who released a white paper two days to high the state’s poor fiscal health, made known that in the first year, the focus will be to restore the deteriorating fiscal health, moderate the augmenting debt, deliver on the promise of good governance and health and concentrate on health and education sector.
“We have to moderate our revenue expenditure while elevating our capital expenditure and implement policies that would result in sustained GDP growth, leading to overall development of the state,” he stated, counting on the growth in reve
nues to tide over the crisis.
Cheema has pegged the revenue receipts in 2022-23 at Rs 95,378 crore to the state exchequer, up 17.08% as compared to revised estimates of 2021-22. Of this, Rs 20,550 crore are estimated to come from the goods and services tax (GST), Rs 6,250 crore from value-added tax, Rs 9,647 crore from state excise, Rs 3600 from stamp duty and registration, Rs 350 crore from sand. Calling the new excise policy a “game changer”, he said that it would break monopolies that have developed in this sector over the years. “We are hoping the excise revenue to increase by 56% over FY 2021-22. Efforts are already on to plug loopholes in GST collections, I expect a buoyancy of about 27% in GST collections in FY 2022-23, which would add around ₹4,350 crore more to the state kitty,” he said.
Share of Central taxes and grants-in-aid from the Centre are estimated at ₹14,757 crore and ₹28,731 crore, respectively. He also announced a tax intelligence unit (TIU) unit in the state to augment additional resource generation.
“It will equip the finance department to improve tax compliances under GST through taxpayer facilitation and communication and strengthen tax analytics capabilities in the department to capture trends, patterns thereby bringing out weak and strong areas,” he said. The state’s s outstanding debt is projected to Rs 3.05 lakh crore in the 2022-23 financial year from Rs 2.83 lakh crore last year.
Drive against corruption
The finance minister also said the AAP government will set up a model of good governance. “Our government has zero-tolerance towards corruption. Our party’s birth started from the anti-corruption movement,” he said, adding the government is acting against those who indulge in corrupt practices. He made a mention of the action taken by the CM against his own health minister Vijay Singla.