New Delhi 01 March 2016: The Social Democratic Party of India, (SDPI), has termed the General Union Budget 2016-17 as purely populist and far away from veritable economic relief to the rural folk. This has been done keeping in mind the assembly elections in several states during next one year. In other words it is an attempt at petty Vote-Bank politics at the expense of long term reforms and nation building, the party said.
SDPI national president A. Sayeed reacting to the Union Budget, presented in Parliament by the Finance Minister Arun Jaitely, said in a statement that no doubt it is a rural and agricultural focussed budget with emphasis on infrastructure development too. However, the major problem is the accountability for a quality spending and measurement of benefits to the country. In fact it is just luring the farmers with numbers and crop insurance. Rural Developments are mostly carried out by state governments then what’s the focus. The only focus is on elections in number of states. In hindsight the present budget is the result of Bihar verdict effect, which was a nightmare for the NDA Government, he added.
Sayeed said budget hardly has anything to offer as far as rationalisation of farm subsidies and their replacement with targetted Direct Benefit Transfers, (DBT), goes. There is only a token announcement proposing introduction of DBT “on pilot basis for fertiliser in a few districts across the country, with a view to improve the quality of service delivery to farmers”. At the same time, no attempt has been made to increase farm gate prices of urea, which the latest Economic Survey had recommended in order to prevent diversion of the nutrient for non-agricultural applications, mainly at the expense of small and marginal farmers.
He said the common man, especially the middle class, has been once again left out in the lurch with service tax hike and no income tax exemption slabs. The budget seems to address the two extremes in the society i.e. either the very poor or the corporate and the very rich sector. The Middle class and salaried sections are let down once again, even though they were the reason for NDA victory. They will continue to pay the tax without any tax concession the least should have been factor of inflation. All things have gone up in terms of prices so why not the income tax slabs. The government has really fooled the people.
Sayeed said that Minorities feel let down as in the budget existing schemes either have a marginal increase in budgetary allocations or coming to an abrupt end. Though the overall Budget allocation for the minorities have been increased by Rs.91 crore to Rs.3,827 crore but no new scheme has been announced while existing schemes have either had their funds slashed or been ended. The provision made under pre-matric scholarship in 2015-16 was 1040 crore, which has been reduced to 931 crore in 2016-17–a reduction of 109 crore. Similarly, the post-matric scholarship scheme was allocated Rs. 550 crore this year, a reduction of Rs.30 crore compared to last year, he pointed out.
He said the proposed tax sops for developers to provide affordable housing can end up being a stimulus package for the real estate industry without meeting the objective of keeping the housing stock affordable for the economically weaker section. The cap of Rs.50 lakh for individual unit without defining the affordability range can be self-defeating. Similarly, though the rural sector has got a boost through allocation for the MNREGA programme and the new crop insurance policy, Pradhan Mantri Fiscal Bima Yojana, these programmes are still underfunded compared to what is needed today.
The statement stated that the claim of jump in allocation for MNREGA programme hides underfunding. While the actual increase in allocation for the MNREGA programme has been from Rs.34,699 crore in 2015-16 to Rs.38,500 crore, in reality this is much less than the actual demand and also less than what was actually spent last year. Due to extreme climatic stress and drought last year, the actual spending on the programme was Rs.41,169 crore. The additional spending of Rs.6,470 crore is the pending liability and if adjusted the actual allocation this year drops to Rs.32,030 crore—less than what was allocated last year.