The Hindu : Tamil Nadu News : Maximum share of Plan outlay earmarked for social services

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Saturday, Jul 05, 2008
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Tamil Nadu

Tamil Nadu

Maximum share of Plan outlay earmarked for social services

T. Ramakrishnan

Water supply and sanitation get Rs. 7,555 crore, education Rs.3,650 crore in the current Plan

CHENNAI: The maximum share of the 11th Plan (2007-2012) outlay has been earmarked to social services.

Of the total outlay of Rs. 85,344 crore, the services, comprising education, health, water supply and sanitation, housing, urban development and welfare of scheduled castes/scheduled tribes/other backward classes, has been allocated Rs. 36,732 crore, accounting for about 43 per cent. In the 10th Plan (2002-2007) document, a sum of Rs. 13,632 crore was set apart for the sector and the share was 34 per cent. At that time, the total outlay was Rs. 40,000 crore.

Among the various components of the social services, water supply and sanitation had been given Rs. 7,555 crore in the current Plan; urban development – Rs. 6,111 crore; education – Rs. 3,650 crore; welfare of SC/ST and OBCs – Rs. 3,570 crore and health – Rs. 2,730 crore.

Talking of the resources, the Plan document said the State borrowings would be Rs. 55,708.5 crore; State’s own funds – Rs. 17,498.78 crore; Central assistance – Rs. 15,783.19 crore and local bodies’ contribution – Rs. 1,600 crore. A negative contribution of public sector enterprises was expected to be of the order of Rs. 5,336.47 crore.

The total investment required for the 11th Plan period was estimated at Rs. 6,49,330 crore (at 2006-2007 prices). Of this, the State sector investment accounted for Rs. 85,344 crore; Central sector’s share – Rs. 1,28,935 crore and the private sector – Rs. 4,35,051 crore.

A review of the 10th Plan (2002-2007) resources projection and achievement revealed that the target was achieved in spite of financial constraints in the first half of the Plan period.

Though the annual plan in the early years had restricted outlays due to various factors, buoyancy in State taxes along with economy of staff expenditure ensured that overall plan targets were fully met.

In the previous Plan period, the Central Assistance realised was Rs. 8,392 crore against the projected Rs. 15,006 crore.

The State’s own resources showed a remarkable improvement from the estimated (minus) Rs.6,135 crore to Rs.3,077 crore. This was largely due to tax buoyancy and fiscal economy. An interesting feature of the State’s own borrowings was the unexpected amount of small savings loan of Rs. 18,292 crore but the projected figure was Rs. 9,110 crore. [In the last two years, the net small savings collections have seen a steep fall]. The Plan document said the tax buoyancy witnessed in the second half of the 10th Plan period might not continue in the initial years of the 11th Plan period due to the introduction of Value Added Tax. The growth was likely to slow down considerably in the initial years and then pick up later.

The document also noted that the State’s own resource availability in the form of Balance from Current Revenue (BCR) was likely to be affected adversely due to the increase in salaries [in the wake of the possible implementation of the Sixth Pay Commission] and reduced growth of taxes during the first half of the 11th Plan period. The resource projection had been done taking these factors into account.

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