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Free power for pumpsets; retirement age 60

S. Rajendran

Focus on Bangalore; higher road tax for cars; tax on mining

— Photo: V. Sreenivasa Murthy

PEOPLE-FRIENDLY: Chief Minister B.S. Yeddyurappa arriving at the Vidhana Soudha in Bangalore to present the State Budget on Thursday.

BANGALORE: Chief Minister B.S. Yeddyurappa in his third consecutive budget presented to the Legislative Assembly on Thursday has stood by several of the promises made to the people by the Bharatiya Janata Party during the run-up to the Assembly elections, including free supply of power for irrigation pumpsets and a further reduction in interest rate on farm loans extended by cooperative institutions.

The revised budget for the year, with the vote-on-account budget having been presented to the Lok Sabha by the Union finance Minister P. Chidambaram during the President’s Rule in the State, categorically reflects the independent authority that Mr. Yeddyurappa has enjoyed in its preparation unlike the earlier two budgets when the BJP was a part of the Janata Dal(S)-led coalition Government. In a way, the budget is populist with the announcement of a string of schemes and programmes, and with hardly any fresh taxes.

Free power supply to irrigation pumpsets up to 10 hp will be made available to farmers from August 1 and consequently, the power subsidy bill of the Government is expected to increase to Rs. 2,050 crore. The farm loan interest rates have been reduced by one per cent from the prevailing four per cent. In another important announcement for the benefit of the farm sector, the Government has announced a one-time payment of Rs. 1,000 a family [small farmer] to purchase seeds, fertilizers and other farm inputs. This is expected to benefit nearly 50 lakh farmers. Milk producers will be paid an incentive of Rs. 2 a litre.

Presenting a Rs. 1,527.45-crore revenue surplus budget (overall surplus of Rs. 18.85 crore), Mr. Yeddyurappa said fiscal deficit had been pegged at 2.83 per cent (in accordance with the Karnataka Fiscal Responsibility Act) thanks to the fiscal reforms. For this year, the expected total receipts will be Rs. 55,273.94 crore while the expenditure is likely to be Rs. 55,313.41 crore. The Government will raise Rs. 31,875.85 crore by way of taxes and another Rs. 1,931.65 crore through non-tax revenue; Rs. 1,571.29 crore by way of loans from the Union Government and Rs. 5,248.42 crore from the Reserve Bank of India and other financial institutions. In the last financial year, the coalition Government had given a commitment that it would refrain from borrowings.

The Government, which, in the last budget announced the implementation of the Fifth Pay Commission report for the benefit of its employees, has now raised the superannuation age of the employees to 60 years from 58 years.

“Experienced employees are an asset to the Government. With the increase in life expectancy, it is possible for the employees to serve for a longer period,” has been the argument of the Chief Minister.

The focus on Bangalore constitutes an important highlight of the budget with a provision of Rs. 1,800 crore, including a financial support of Rs. 300 crore for the Bruhat Bangalore Mahanagara Palike, Rs. 100 crore for the Bangalore Water Supply and Sewerage Board, Rs. 700 crore for the Bangalore Metro Rail Project and Rs. 240 crore for upgrading certain important roads.

For the backwards areas of the State (implementation of the Dr. Nanjundappa panel report on regional imbalances), Mr. Yeddyurappa has announced an allocation of Rs. 2,547 crore under the special development plan. In the last budget, Rs. 1,571 crore was allocated under the same programme but most of it went unutilised after the imposition of President’s Rule.

Among the few taxation measures, the Government has marginally raised the road tax on cars and introduced a forest development tax on mining and quarrying operations in forest areas.

The Chief Minister, after presenting the budget, said, “I am happy today and I have the satisfaction of doing something for farmers through budgetary proposals such as providing free power to them.” He said he had, through the budget, implemented most of the pre-poll promises made by his party.

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