Ahead of Assembly elections, West Bengal finance minister Amit Mitra on Friday presented a vote-on-account, streaked with references to high growth and increased social sector spending as prominent achievements of five years of Mamata Banerjee’s government.
Vote-on-account deals only with the expenditure side of the government's Budget. The government gives an estimate of the funds it requires to meet the expenditure that it incurs during the first few months of an election financial year till a new government is in place.
For 2015-16, going by the gross value added (GVA) count, West Bengal’s growth at factor cost is 12.02 per cent, against the national count of 7.30 per cent.
Despite high growth, the debt of the government crossed Rs 3 lakh crore in 2015-16. The debt in 2016-17 is expected to touch Rs 3,34,608 crore (against Rs 3,04,940 crore in 2015-16, Revised Estimates), one of the highest among states. Between May 2011 and the end of March 2016, it is estimated that about Rs 1,40,722 crore would have been deducted from the state treasury as interest and principal repayment, said Mitra.
The borrowing of the government will continue to rise; the total market loan for 2016-17 is pegged at Rs 27,204 crore (Budget Estimates) in 2016-17, against Rs 24,500 crore in 2015-16 (Revised Estimates).
The state has projected a 16.96 per cent increase in Plan expenditure for 2016-17. The Plan expenditure for 2016-17 has been pegged at Rs 57,905 crore, against Rs 49,507 crore in 2015-16 (Budget Estimates), a growth of 16.96 per cent.
According to Mitra, the tax reforms of the government have paved way for a soft loan of $300 million from Asian Development Bank, which he claimed to be the biggest programme-lending loan to any state. Despite a number of steps by the state to increase revenue, the revenue deficit for 2015-16 is estimated at nearly Rs 3,869 crore, while the fiscal deficit is estimated to be about Rs 19,377 crore.
However, compared to the revenue and fiscal deficit (actuals) in 2014-15, the deficit has come down significantly. In 2014-15, the revenue deficit (actuals) was Rs 17,137 crore, while the fiscal deficit (actuals) was Rs 27,345 crore.
The total state tax revenue increased by nine per cent in 2015-16 (Revised Estimates) over 2014-15 (actuals) to nearly Rs 42,920 crore in 2015-16 (Revised Estimates). The state missed its budgeted revenue-collection target of Rs 46,497 crore for 2015-16, a shortfall of about Rs 3,577 crore. The total tax revenue for 2016-17 is pegged at about Rs 50,219 crore.
Mitra said that subsequent to the acceptance of the recommendations of the 14th finance commission for increasing the devolved share of the state from 32 to 42 per cent, several central government schemes had been unilaterally structured, which resulted in de-notification of 39 such schemes. This apart, in case of 58 schemes, the share of state government spending has drastically increased, all of which has hit state finances, said Mitra.
The state’s share of Union taxes and duties stood at Rs 38,461 crore in 2015-16 (Revised Estimates), against a projection of Rs 31,966 crore in 2015-16 Budget. Moreover, in 2016-17, the share is expected to be around Rs 42,314 crore, a rise of 32 per cent against the Budget Estimates of 2015-16.