New government, old priorities

Allocations for flagship schemes, social sector almost same

The Budget presented by the National Democratic Alliance government on Thursday suggests that its initial economic priorities are not very different from those of the Interim Budget of the United Progressive Alliance government.

On comparing the two, The Hindu found that the NDA had just under Rs. 30,000 crore more than the former UPA government in receipts, discounting borrowings, and spent a little over Rs. 31,000 crore more than its predecessor.

How did the NDA use this extra spending money? Among the major ministries, two saw large absolute increases in their allocations — Rs. 5,000 crore each to Defence and Fertilizer Ministries — while Road Transport got Rs. 3,000 crore more than the UPA’s allotment. In percentage change terms, the Tourism Ministry, whose budget nearly tripled, saw the biggest increase and the Aviation Ministry saw a 16 per cent growth in its allocation.

Social sector ministries did not see cuts in their budgets — the Rural Development Ministry got two per cent more than that it got in February, and the Health Ministry got 1.4 per cent more. Other social sector ministries — the Food and Public Distribution Department, the Ministry of Minority Affairs, the Social Justice Ministry, the Ministry of Housing and Urban Poverty Alleviation — got exactly the same allocation. Flagship welfare schemes — the Integrated Child Development Services, the Total Sanitation Campaign and the Mahatma Gandhi National Rural Employment Guarantee Scheme — have also got exactly the same allocation.

What these numbers show is that when the economic climate is similar, governments of different ideologies have fairly similar spending priorities, said N.R. Bhanumurthy, professor at the National Institute for Public Finance and Policy. “To their credit, it also shows that the two major parties have a tacit understanding over minimum spending on some basics,” he added.

This similarity in their spending priorities was also visible between the UPA’s first Budget in 2004 and the then outgoing NDA’s interim budget,

The Hindu found. Despite being associated with expanded social sector spending, the UPA’s first budget actually allocated less for the Rural Development Ministry and the Food Ministry than its predecessor. Over 10 years, however, priorities changed, the numbers show. The Rural Development Ministry’s allocation grew 585 per cent between the UPA’s first and last budgets, and the Food Ministry’s by 342 per cent. The biggest gainers were the Road Transport, Water Resources and Health ministries.