The Hindu : VS criticises new trend in financial management

Online edition of India's National Newspaper
Sunday, Jan 25, 2004

Kerala

Kerala

VS criticises new trend in financial management

By Our Special Correspondent

THIRUVANANTHAPURAM, JAN. 24 The Leader of the Opposition, V. S. Achuthanandan, today came down heavily on the State Government's new tendency of issuing "memo clearance" to release funds for various line departments instead of following the usual practice of sanctioning budget provisions.

Terming the practice as unconstitutional and subversion of the budgetary provisions passed by the legislature, Mr. Achuthanandan said that the new tendency had made the entire budgetary process redundant.

Addressing a press conference here, the Opposition Leader asserted that the State's financial management had deviated from budgetary proposals. The Government had announced a Plan outlay of Rs. 4350 crores during 2003-04, but going by the current trend, the Government would not be able to achieve even the Rs. 2,250 crore target in Plan implementation.

He said the "memo clearance" system was the outcome of the practice of preparing budgets based on unrealistic figures and the budget for 2004-05 has repeated the same mistake. The Finance Minister has allocated Rs. 4,800 crores for the annual Plan for 2004-05, but going by the current trend, it would be possible to implement projects worth Rs. 2,800 crores, he pointed out.

Pointing out to the contradictions in the figures submitted to the 12 Finance Commission and those contained in the budget, Mr. Achuthanandan said that the figures submitted to the Finance Commission had shown Rs. 13,407 crores as revenue income, while the budget papers showed a revenue income of Rs. 14, 263 crores.

If the Rs. 856 crores excess shown in the budget figures were reckoned, then the revenue deficit would work out to Rs. 5,564.09 crores instead of the Rs. 4,708.13 crores as estimated in the budget.

Mr. Achuthanandan also expressed concern at the debt the UDF Government had mounted during just 31 months in power. He questioned the Finance Minister's claim that the money mobilised through borrowings had been spent on development.

The UDF Government had cut the size of the Plan for three consecutive years and the annual Plan for 2003-04 would also fall far below target. He alleged that the State Government had failed to get matching grants from the Centre on account of the cut in Plan size.

He said that the various unemployment schemes, which had been announced in the last two budgets, had not been not taken up for implementation. The Rs. 201 crores earmarked in the previous budget for tackling unemployment was a non-starter. The Government's promise to provide permanent employment to 5 lakh youths, besides creating 15 lakh job opportunities in five years remain to be fulfilled. There was every reason to believe that the Rs. 127 crores employment generation schemes would meet a similar fate, he added.

He also questioned the Finance Minister's claim that the Global Investors' Meet was a grand success. Investments worth Rs. 121 crores only had taken place as against the promise that an investment of Rs. 23,000 crores would flow into the state as a result of the GIM.

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