Slew of welfare measures in PTR's maiden full budget for TN

For the first time in eight years, Tamil Nadu  will see a reduction in its revenue deficit of over ₹7,000 crore, said state Finance Minister Palanivel Thiaga Rajan in his Budget speech on Friday, March 18. The state budget focused on the areas of social safety net, data driven governance, environmental sustainability and inter-generational equity, and rolled out a slew of welfare measures.

The Finance Minister spoke of “persistent attempts to erode the federal architecture of our polity”, adding: “The makers of our Constitution envisaged a harmonious relationship between the Union and States, built on the foundations of state autonomy and true federalism.”

The Tamil Nadu Budget for 2022-23 is a keenly watched one, not in the state but across the country. It is the maiden full budget of the MK Stalin-led DMK government that took charge of the state in May 2021. The incumbent has accused the previous AIADMK government, which enjoyed a 10-year tenure, of gross financial mismanagement.

Social and economic growth

There has also been much speculation on how PTR, as the Finance Minister is popularly referred to as, will balance the need for strict fiscal discipline, which the state is in dire need of now, with the Dravidian political philosophy of social parity with economic upliftment. PTR, a finance professional with a business management degree from the MIT Sloan School of Management, and stints at leading brokerages and banking institutions, has been vocal about the need to prioritise social development on par with — if not above — economic growth.

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In this backdrop, PTR said on Friday that since 2014, Tamil Nadu’s fiscal deficit had been on a rise, and is now set to decline from 4.61 per cent to 3.80 per cent.

“This year, Tamil Nadu will see a reduction in the absolute level of the revenue deficit by over ₹7,000 crore, reversing an alarming trend of increasing deficits every year since 2014. Further, we are poised to see a significant reduction of the fiscal deficit from 4.61 per cent to 3.80 per cent even during a challenging year,” he said.

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Stalin’s leadership

The decline was made possible by the application of political will and that comes from the leadership of Stalin, who is the embodiment of the Dravidian ideal, he added.

“In his every thought and deed, he illustrates the Dravidian ideals of self-respect, social justice, communal harmony and inclusive growth. Despite significant advances, the battle for social justice is still only half-won. Hence, we will continue to remain steadfast in our determination to achieve social justice in all walks of life,” said PTR.

Revenue deficit is the difference between the government’s total revenue expenditure and its total revenue receipts. These receipts and expenditures have a direct impact on the government’s current income and expenses. 

Citing the coronavirus pandemic, the floods and the government action to tackle the situation, PTR said these had had a negative impact on the state’s already stressed finances. “Though the revenue deficit since 2014 has risen every year in an intimidating manner, for the first time this year, it has been changed and Tamil Nadu’s revenue deficit is set to decrease by over ₹7,000 crore,” he said.

Welfare measures

PTR rolled out various measures including the allocation of ₹500 crore for the ‘Singara Chennai 2.0’ project aiming at flood-mitigation, and allocation of ₹2,800 crore for Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA) scheme for FY23. The scheme to provide free travel to women across the state implemented by the DMK government was a success, he said, since it has increased the proportion of female passengers from 40 per cent to 60 per cent.