Higher spend on low base

Plan expenditure curbs for FY13 helps FM's outlay math for FY14

A whopping 17 per cent cut in Plan expenditure for the current fiscal in the Budget over the original estimate hid the rise in non-plan expenditure for this financial year, and helped the finance minister make the total outlay for the next financial year look much higher.

For 2013-14, expenditure is pegged at Rs 16.65 lakh crore, 16 per cent higher than the Revised Estimates (RE) of Rs 14.31 lakh crore. However, when compared to Budget Estimates (BE) of Rs 14.91 lakh crore, it is an 11 per cent rise.

This happened because Plan expenditure was cut this financial year from Rs 5.21 lakh crore in the BE to Rs 4.30 lakh crore in the RE. This made even Rs 5.5 lakh crore for next year a 30 per cent rise over this fiscal's RE.

On the other hand, Non-Plan expenditure rose 16.43 per cent to Rs 10.01 lakh crore in this fiscal's RE against Rs 9.69 lakh crore pegged in the BE. For 2013-14, expenditure is pegged at Rs 11.10 lakh crore, around 11 per cent higher than the 2012-13 RE.

The crucial point is whether the government will stick to its Non-Plan expenditure target, given that petroleum subsidies are pegged at Rs 65,000 crore in 2013-14 against an RE of Rs 97,000 crore for 2012-13. In recent years, the petroleum subsidy has been under-budgeted.

The central Plan outlay on social services has gone up to Rs 1,93,043 crore from the current fiscal's RE of Rs 1,58,339 crore. The outlay on rural development has risen to Rs 56,438 crore and is estimated at Rs 43,704 crore in the current fiscal. The outlay on science, technology and environment is Rs 17,587 crore, and is estimated at Rs 12,119 in 2012-13.