Punjab Chief Minister Captain Amarinder Singh on Monday said capital expenditure in essential sectors such as health education and infrastructure would be retained at ₹5,000 crore, notwithstanding the economic crisis facing the State, which was expecting a shortfall of nearly 30% in the revenue receipts (TRR) in financial year 2020-21 on account of the COVID-19 and the lockdown.
Reviewing the economic situation at a video conference meeting of the Empowered Committee of Cabinet on Fiscal Management, the Chief Minister said the focus of his government was on ensuring that salaries and pensions continue to be paid on time. “No compromise could be made in ensuring funding for all frontline departments such as health, police and the local bodies which are working 24X7 in battling the disaster,” he said.
As per the Finance Department’s estimates, Punjab can expect TRR of around ₹62,246 crore during FY 2020-21, i.e. a shortfall of around ₹25,758 crore or a 29.26 % dip in the TRR.
The Chief Minister said power subsidy to the farmers would continue and there was no question of the State government accepting the condition to replace it with direct cash transfer for availing the additional borrowing limit allowed by the Centre.
“This so-called power reform was violative of the federal structure.” He said he would write to the Prime Minister as the Central government could not place conditions on States for availing loans.
The recent Ordinance on agricultural reforms could pave the way for the elimination of the MSP regime and he would convey Punjab’s opposition to the Centre very strongly, Captain Amarinder said.
Earlier, the meeting took stock of the State’s deteriorating fiscal situation. For April 2020, the decline in the TRR against the budget estimates was 12%, which went up to a whopping 37% in May, aggregating to 25% of the budget estimates for these two months. The expenditure budgeted for FY 2020-21 was ₹1,08,644 crore — including revenue expenditure of ₹95,716 crore and principal repayment of ₹12,928 crore.
The State’s own receipts came down to a mere ₹396 crore in April 2020 amid the lockdown, with receipts for the month standing at ₹6,797 crore, followed by ₹3,891 crore in May (State’s own receipts at ₹1,252 crore). In fact, receipts (inclusive of the ₹4,200 crore marketing borrowings) have been an abysmal ₹15,882 crore from April to June 5, 2020, according to an official statement.
