CHENNAI: The government proposes to increase social sector spending in a major way this financial year - it is projected to rise by over Rs. 2,000 crore over that of last year.

In 2005-06 (revised estimates), the expenditure was Rs.11, 942.49 crore.

The most remarkable feature of the first budget of the Karunanidhi Government is that it has allocated an unprecedented Rs.13, 983 crore for social sector programmes while staying within the boundaries prescribed in the Medium Term Fiscal Plan.

This means that the government would spend more on education, delivering health services, water and sanitation projects, housing and urban development projects, welfare of the backward and oppressed classes and on nutrition over the next year.

The amount earmarked for general education is Rs.6, 137.51 crore, up from Rs.4, 946.3 crore in 2005-06 (revised estimates). Similarly, the outlay for medical and public health is projected to jump from 1,189.96 crore (2005-06, revised estimates) to Rs.1, 500.69 crore.

Another big ticket item for the government is under the social security and welfare head: here, the expenditure will rise from Rs.1223.74 crore (2005-06, revised estimates) to Rs.1678.18 crore in 2006-07.

Housing schemes

The expenditure on housing schemes is projected to rise more than three times that of the previous year - from Rs.139.8 crore in 2005-06 (revised estimates) to Rs.496.63 crore in 2006-07.

Similar is the case in urban development - a jump from Rs.253.7 crore (2005-06, revised estimates) to Rs.612.79 crore.

When the `interim' budget estimates were presented early this year, the outlay for social service sector was pegged at Rs.11, 136 crore.

With the new government taking charge, the sector has received an additional amount of just over Rs.2000 crore.

The expenditure on social services accounts for nearly 35 per cent of the total revenue expenditure. This represents an increase of more than 17 per cent over the expenditure estimated in 2005-06 (revised estimates).

The Budget Memorandum (part 1) says that after deducting the relief on account of natural calamities, expenditure on social service is 36 per cent more than the revised estimates of 2005-06.

"This is mainly on account of enhanced outlay on social sector schemes (marriage assistance scheme, maternity assistance scheme, old age and other pensions, unemployment allowance, additional provision for eggs etc.), provision of houses and livelihood programme for tsunami affected people, schemes under Jawaharlal Nehru Urban Renewal Mission and enhanced salary related expenditures."

Even after the huge spending, officials say that the government would still manage to achieve its targets under the Medium Term Fiscal Plan.

Revenue deficit

The revenue deficit over total revenue receipts has been projected to be 2.93 per cent in 2006-07, which is well within the five per cent mark that was earlier set. By 2008-09, the revenue deficit should be wiped out and the government was well on course to achieve this.

Similarly, the fiscal deficit as a percentage of the Gross State Domestic Product should be below three per cent by 2008-09. This has already been achieved and the trend would be maintained this year.

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