Deprecated (16384): The ArrayAccess methods will be removed in 4.0.0.Use getParam(), getData() and getQuery() instead. - /home/brlfuser/public_html/src/Controller/ArtileDetailController.php, line: 150
 You can disable deprecation warnings by setting `Error.errorLevel` to `E_ALL & ~E_USER_DEPRECATED` in your config/app.php. [CORE/src/Core/functions.php, line 311]
Code Context


        trigger_error($message, E_USER_DEPRECATED);

    }
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 You can disable deprecation warnings by setting `Error.errorLevel` to `E_ALL & ~E_USER_DEPRECATED` in your config/app.php.'
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deprecationWarning - CORE/src/Core/functions.php, line 311
Cake\Http\ServerRequest::offsetGet() - CORE/src/Http/ServerRequest.php, line 2421
App\Controller\ArtileDetailController::index() - APP/Controller/ArtileDetailController.php, line 150
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Cake\Http\Runner::__invoke() - CORE/src/Http/Runner.php, line 65
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Cake\Http\Runner::__invoke() - CORE/src/Http/Runner.php, line 65
Cake\Http\Runner::run() - CORE/src/Http/Runner.php, line 51
Cake\Http\Server::run() - CORE/src/Http/Server.php, line 98

Deprecated (16384): The ArrayAccess methods will be removed in 4.0.0.Use getParam(), getData() and getQuery() instead. - /home/brlfuser/public_html/src/Controller/ArtileDetailController.php, line: 151
 You can disable deprecation warnings by setting `Error.errorLevel` to `E_ALL & ~E_USER_DEPRECATED` in your config/app.php. [CORE/src/Core/functions.php, line 311]
Code Context


        trigger_error($message, E_USER_DEPRECATED);

    }
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 You can disable deprecation warnings by setting `Error.errorLevel` to `E_ALL & ~E_USER_DEPRECATED` in your config/app.php.'
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deprecationWarning - CORE/src/Core/functions.php, line 311
Cake\Http\ServerRequest::offsetGet() - CORE/src/Http/ServerRequest.php, line 2421
App\Controller\ArtileDetailController::index() - APP/Controller/ArtileDetailController.php, line 151
Cake\Controller\Controller::invokeAction() - CORE/src/Controller/Controller.php, line 610
Cake\Http\ActionDispatcher::_invoke() - CORE/src/Http/ActionDispatcher.php, line 120
Cake\Http\ActionDispatcher::dispatch() - CORE/src/Http/ActionDispatcher.php, line 94
Cake\Http\BaseApplication::__invoke() - CORE/src/Http/BaseApplication.php, line 235
Cake\Http\Runner::__invoke() - CORE/src/Http/Runner.php, line 65
Cake\Routing\Middleware\RoutingMiddleware::__invoke() - CORE/src/Routing/Middleware/RoutingMiddleware.php, line 162
Cake\Http\Runner::__invoke() - CORE/src/Http/Runner.php, line 65
Cake\Routing\Middleware\AssetMiddleware::__invoke() - CORE/src/Routing/Middleware/AssetMiddleware.php, line 97
Cake\Http\Runner::__invoke() - CORE/src/Http/Runner.php, line 65
Cake\Error\Middleware\ErrorHandlerMiddleware::__invoke() - CORE/src/Error/Middleware/ErrorHandlerMiddleware.php, line 96
Cake\Http\Runner::__invoke() - CORE/src/Http/Runner.php, line 65
Cake\Http\Runner::run() - CORE/src/Http/Runner.php, line 51
Cake\Http\Server::run() - CORE/src/Http/Server.php, line 98

Warning (512): Unable to emit headers. Headers sent in file=/home/brlfuser/public_html/vendor/cakephp/cakephp/src/Error/Debugger.php line=853 [CORE/src/Http/ResponseEmitter.php, line 48]
Code Context
            if (Configure::read('debug')) {

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        NEWS ALERTS | Union Budget 2016-17: Mere eyewash or some concrete steps    </title>
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In the age of social media, various sections of the Indian polity and civil society have reacted publicly in diverse voices, following the presentation of the Union Budget 2016-17 by Finance Minister Shri Arun Jaitley.

An assessment of the Union Budget..."/>
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In the age of social media, various sections of the Indian polity and civil society have reacted publicly in diverse voices, following the presentation of the Union Budget 2016-17 by Finance Minister Shri Arun Jaitley.

An assessment of the Union Budget..." />
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    <h1 class="cat-box-title">Union Budget 2016-17: Mere eyewash or some concrete steps</h1>
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                            <br /><div align="justify">In the age of social media, various sections of the Indian polity and civil society have reacted publicly in diverse voices, following the presentation of the <a href="https://im4change.in/empowerment/union-budget-73.html?pgno=2#union-budget-2016-17" title="https://im4change.in/empowerment/union-budget-73.html?pgno=2#union-budget-2016-17">Union Budget 2016-17</a> by Finance Minister Shri Arun Jaitley.<br /><br />An assessment of the Union Budget 2016-17 has been done in the following paragraphs by the Inclusive Media for Change team, based on a number of media reports, Government documents (including the Budget documents), and reports prepared by CSOs. <br /><br /><strong>Public Finance<br /></strong><br />Although the Budget documents (please <a href="http://indiabudget.nic.in/ub2016-17/bag/bag11.pdf" title="http://indiabudget.nic.in/ub2016-17/bag/bag11.pdf">click here</a> to read) show that the budgetary estimates of tax revenue (net to centre) i.e. Rs. 9,19,842 crore was lesser than the revised estimates of Rs. 9,47,508 crore during 2015-16, in his retweet P Chidambaram (@PChidambaram_IN) has said the following: <br /><br /><br /><blockquote><p dir="ltr">The whopping increase in tax collected was due to the several times govt hiked excise duty on petrol &amp; diesel: <a href="https://twitter.com/PChidambaram_IN" title="https://twitter.com/PChidambaram_IN">@PChidambaram_IN</a></p>&mdash; INC India (@INCIndia) <a href="https://twitter.com/INCIndia/status/704264102437216256" title="https://twitter.com/INCIndia/status/704264102437216256">February 29, 2016</a></blockquote><br /><br />In the recent past, many economists had alleged that the Government did not pass the benefit of lower international crude prices to domestic consumers. <br /><br />Likewise the Economic Times (@EconomicTimes), after the Union Budget presentation, has retweeted the following message: <br /><br /><br /><blockquote><p dir="ltr">Govt boasting they collected more tax than ever. It was only due to excise on Crude. Not from Corporation or Income tax: <a href="https://twitter.com/PChidambaram_IN" title="https://twitter.com/PChidambaram_IN">@PChidambaram_IN</a></p>&mdash; EconomicTimes (@EconomicTimes) <a href="https://twitter.com/EconomicTimes/status/704264388065112065" title="https://twitter.com/EconomicTimes/status/704264388065112065">February 29, 2016</a></blockquote><br /><br />The concerns appear valid because from the Budget documents (please <a href="http://indiabudget.nic.in/ub2016-17/bag/bag2.pdf" title="http://indiabudget.nic.in/ub2016-17/bag/bag2.pdf">click here</a> to read) it could be observed that the RE of both corporation tax and income tax revenue fell below the budgetary estimates during 2015-16. However, RE was much greater than BE for tax revenue collected through Union Excise Duties in that year.<br /><br />CPI (M) General Secretary Sitaram Yechury (@SitaramYechury) has tweeted the following messages regarding Government's reliance on indirect taxes instead of direct taxes for revenue collection:<br /><br /><br /><blockquote><p dir="ltr">Increasing cess hurts the common man, with indirect tax collections proposed to be up by 20,600 cr. Direct tax proposals are down by 1060 cr</p>&mdash; Sitaram Yechury (@SitaramYechury) <a href="https://twitter.com/SitaramYechury/status/704240871164645376" title="https://twitter.com/SitaramYechury/status/704240871164645376">February 29, 2016</a></blockquote><br /><br /><blockquote><p dir="ltr">This means more burden on common people as indirect taxes are inflationary. So there will be no expansion in domestic demand.</p>&mdash; Sitaram Yechury (@SitaramYechury) <a href="https://twitter.com/SitaramYechury/status/704241179945099264" title="https://twitter.com/SitaramYechury/status/704241179945099264">February 29, 2016</a></blockquote></div><div align="justify"><br /><br />The FM in his budget speech has informed us that the fiscal deficit in RE 2015-16 and BE 2016-17 have been retained at 3.9 percent and 3.5 percent of GDP, respectively. In his opinion piece entitled: <em>Why the Budget numbers don&rsquo;t add up</em>, which was published in The Hindu dated 1 March, 2016, Dr. Rohit Azad, who teaches at JNU, has said that the fiscal deficit as a percentage of GDP has been brought down by increasing the collection of indirect taxes and excise duties, even as the non-plan expenditure went down (please <a href="https://im4change.in/latest-news-updates/why-the-budget-numbers-dont-add-up-rohit-azad-4678723.html" title="https://im4change.in/latest-news-updates/why-the-budget-numbers-dont-add-up-rohit-azad-4678723.html">click here</a> to read). <br /><br />An Analysis of the Union Budget 2016-17 by Centre for Budget and Governance Accountability (CBGA) in a report entitled <em>Connecting the Dots </em>has revealed that during 2016-17 (BE) the proportion of direct taxes and indirect taxes in the gross central taxes is estimated at 52:48, as compared to the ratio of 56:44 during 2014-15. Although indirect taxes are considered to be regressive in nature, the Central Government is increasingly getting dependent on indirect taxes.&nbsp; &nbsp;<br /></div><div align="justify">&nbsp;</div><div align="justify">The Fourteenth Finance Commission recommended to devolve 42 percent of the net proceeds of the Union tax revenues to states, against 32 percent suggested by the Thirteenth Finance Commission. However, due to the imposition of various types of cess and surcharge in the 2016-17 Union budget such as Krishi Kalyan cess, Education cess, Swachh Bharat cess, Clean Energy cess etc., states&rsquo; share in the divisible pool is likely to be 37 percent, instead of 42 percent. It is because cess / surcharges collected goes directly to the Centre, and not to the states.&nbsp; &nbsp;<br /><br />Prof. Jayati Ghosh in her Indian Express article dated 2 March, 2016 has said that during 2015-16 the share of states in the divisible pool has declined from the projected 36.3 percent of tax revenues to 34.8 percent (please <a href="http://indianexpress.com/article/opinion/columns/hype-and-reality-of-budget-2016/" title="http://indianexpress.com/article/opinion/columns/hype-and-reality-of-budget-2016/">click here</a> to read).<br /><br /><strong>Farm incomes<br /></strong><br />The BJP in its 2014 election manifesto (please <a href="http://www.bjp.org/images/pdf_2014/full_manifesto_english_07.04.2014.pdf" title="http://www.bjp.org/images/pdf_2014/full_manifesto_english_07.04.2014.pdf">click here</a> to read) had declared that if voted to power it will <em>&quot;take steps to enhance the profitability in agriculture, by ensuring a minimum of 50% profits over the cost of production, cheaper agriculture inputs and credit; introducing latest technologies for farming and high yielding seeds and linking MGNREGA&nbsp; to agriculture&quot;</em>, among other things. <br /><br />P Chidambaram has made the following tweets regarding NDA&rsquo;s promise of fair and remunerative minimum support price (MSP) of agricultural commodities: </div><div align="justify">&nbsp;</div><div align="justify"><br /><blockquote><p dir="ltr">It did worse last year by giving meagre<br />or nil increases in MSP. Budget speech makes no promise of fair &amp; remunerative MSP: <a href="https://twitter.com/PChidambaram_IN" title="https://twitter.com/PChidambaram_IN">@PChidambaram_IN</a></p>&mdash; INC India (@INCIndia) <a href="https://twitter.com/INCIndia/status/704269608841146368" title="https://twitter.com/INCIndia/status/704269608841146368">February 29, 2016</a></blockquote><br /><br /><blockquote><p dir="ltr">On Agri, I am happy that UPA schemes are being continued, but crucial signal is 'Price'. NDA reneged on its<br />promise to give cost plus 50%</p>&mdash; INC India (@INCIndia) <a href="https://twitter.com/INCIndia/status/704269264102887424" title="https://twitter.com/INCIndia/status/704269264102887424">February 29, 2016</a></blockquote><br /><br />The Communist Party of India (Marxist) (@cpimspeak) has made the following tweet regarding NDA&rsquo;s commitment to reduce farm distress:<br /><br /><blockquote><p dir="ltr"><a href="https://twitter.com/hashtag/Budget2016?src=hash" title="https://twitter.com/hashtag/Budget2016?src=hash">#Budget2016</a> Govt talks about doubling farm income by 2022 but not a single reference to thousands of farmer suicides.</p>&mdash; CPI (M) (@cpimspeak) <a href="https://twitter.com/cpimspeak/status/704219581989019648" title="https://twitter.com/cpimspeak/status/704219581989019648">February 29, 2016</a></blockquote><br /><br />In his budget speech, the FM has said that 3 specific initiatives will be taken up in 2016-17 so that the benefit of MSP reaches farmers in all parts of the country. First, the remaining states will be encouraged to take up decentralized procurement. Second, an online Procurement System will be undertaken through the Food Corporation of India so as to usher in transparency and convenience to the farmers through prior registration and monitoring of actual procurement. Third, effective arrangements have been made for pulses procurement. <br /><br />The FM in his budget speech has said that the Government is implementing the Unified Agriculture Marketing Scheme, which envisages a common e-market platform that will be deployed in selected 585 regulated wholesale markets. <br /><br />It is, however, not clear whether the policy of public procurement of foodgrains will be replaced slowly overtime by such open market online trading. The Government&rsquo;s commitment towards providing minimum support prices and remunerative prices for farmers becomes doubtful in the light of the Economic Survey 2015-16 recommending to replace the present system of MSP/ procurement based public distribution system (PDS) with direct benefit transfer (DBT) and freeing the market of all controls on domestic movement and import (please check the <em>chapter 5: Prices, Agriculture and Food Management</em>, Economic Survey 2015-16, Vol-2, please <a href="http://indiabudget.nic.in/es2015-16/echapvol2-05.pdf" title="http://indiabudget.nic.in/es2015-16/echapvol2-05.pdf">click here</a> to read). <br /><br />Although at first glance it may seem that the allocation to Department of Agriculture, Cooperation and Farmers Welfare (under the Ministry of Agriculture) has been more than doubled from Rs. 15803.04 crore (RE) in 2015-16 to Rs. 35968.79 crore (BE) in 2016-17 (as could be seen from the Expenditure Budget Volume I, please <a href="http://indiabudget.nic.in/ub2016-17/eb/stat02.pdf" title="http://indiabudget.nic.in/ub2016-17/eb/stat02.pdf">click here</a> to access), various public finance experts such as Prof. CP Chandrasekhar and Prof. Jayati Ghosh have argued that it has happened because the head 'interest subsidy for short term credit to farmers', which earlier came as part of the demand-for-grants of the Ministry of Finance, has been moved to the Ministry of Agriculture (please <a href="https://im4change.in/latest-news-updates/the-human-face-of-budget-2016-17-cp-chandrasekhar-4678726.html" title="https://im4change.in/latest-news-updates/the-human-face-of-budget-2016-17-cp-chandrasekhar-4678726.html">click here</a> to read). <br /><br />Likewise many other heads / schemes have been moved from one ministry to another, thus, creating the illusion that budgetary allocations have been increased for certain ministries or departments.<br /><br />For the Pradhan Mantri Fasal Bima Yojana (PMFBY), the budgetary allocation has been raised from Rs. 2,955 crore (RE) in 2015-16 to Rs. 5,501 crore (BE) in 2016-17. It has been alleged by farmers' organizations that the recently launched PMFBY is a dressed-up version of two existing schemes, viz. National Agricultural Insurance Scheme (NAIS) and the Modified NAIS (MNAIS). The claim that the new crop insurance scheme has reduced premium is not true since the existing NAIS, which has fairly low premiums of 1.5-3.5 percent for foodgrains and oilseeds crops and actuarial rates for horticultural and cash crops, is already running in 14 states. For a critical understanding of PMFBY, one can consult the article entitled <em>Here is why farmers' rights groups are unhappy with PM Modi's insurance scheme for them</em>, which has been written by Yogesh Pawar for DNA, dated: 17 January, 2016 (please <a href="https://im4change.in/latest-news-updates/here-is-why-farmers039-rights-groups-are-unhappy-with-pm-modi039s-insurance-scheme-for-them-yogesh-pawar-4678366.html" title="https://im4change.in/latest-news-updates/here-is-why-farmers039-rights-groups-are-unhappy-with-pm-modi039s-insurance-scheme-for-them-yogesh-pawar-4678366.html">click here</a> to read). <br /><br />Prior to the budget, the Swaraj Abhiyan criticized the PMFBY by saying that when there is crop loss, the same yield-based assessment arbitrarily decided by <em>patwaris </em>will apply (please <a href="https://im4change.in/latest-news-updates/new-insurance-scheme-has-nothing-for-farmers-swaraj-abhiyan-4678624.html" title="https://im4change.in/latest-news-updates/new-insurance-scheme-has-nothing-for-farmers-swaraj-abhiyan-4678624.html">click here</a> to read). <br /><br />Some of the tweets made by Opposition regarding the provision for farm sector under the budget, are as follows:<br /><br /><br /><blockquote><p dir="ltr">BJP forgets its own promises of fixing MSPs. Their promise that farmers will make at least 50% profit on their investment remains forgotten.</p>&mdash; INC India (@INCIndia) <a href="https://twitter.com/INCIndia/status/704362103021240321" title="https://twitter.com/INCIndia/status/704362103021240321">February 29, 2016</a></blockquote><br /><br /><blockquote><p dir="ltr">It did worse last year by giving meagre<br />or nil increases in MSP. Budget speech makes no promise of fair &amp; remunerative MSP: <a href="https://twitter.com/PChidambaram_IN" title="https://twitter.com/PChidambaram_IN">@PChidambaram_IN</a></p>&mdash; INC India (@INCIndia) <a href="https://twitter.com/INCIndia/status/704269608841146368" title="https://twitter.com/INCIndia/status/704269608841146368">February 29, 2016</a></blockquote><br /><br /><blockquote><p dir="ltr">Former Prime Minister Dr Manmohan Singh's reaction to <a href="https://twitter.com/hashtag/Budget2016?src=hash" title="https://twitter.com/hashtag/Budget2016?src=hash">#Budget2016</a> <a href="https://t.co/fhCP3ZdlOo" title="https://t.co/fhCP3ZdlOo">pic.twitter.com/fhCP3ZdlOo</a></p>&mdash; INC India (@INCIndia) <a href="https://twitter.com/INCIndia/status/704276665656946689" title="https://twitter.com/INCIndia/status/704276665656946689">February 29, 2016</a></blockquote><br /><br /><strong>MGNREGA<br /></strong><br />The FM has proposed to allocate Rs. 38,500 crore for MGNREGA during 2016-17. The budgetary estimate last year was Rs. 34,699 and the RE was Rs. 36,967 crore (please <a href="http://indiabudget.nic.in/ub2016-17/eb/sbe75.pdf" title="http://indiabudget.nic.in/ub2016-17/eb/sbe75.pdf">click here</a> to read). As compared to last year's BE, the allocation in 2016-17 has been hiked by nearly 11 percent. However, if one takes into account the inflation in Consumer Price Index (combined) between January 2016 and January 2015, which is roughly 5.7 percent (please <a href="http://mospi.nic.in/Mospi_New/upload/cpi_pr_12feb16f.pdf" title="http://mospi.nic.in/Mospi_New/upload/cpi_pr_12feb16f.pdf">click here</a> to read), then the net hike under MGNREGA is around 5.3 percent. &nbsp;<br /><br />If one takes into account the inflation in Consumer Price Index Numbers for Agricultural Labourers (1986-87= 100) between January 2016 (CPIAL: 849) and January 2015 (CPIAL: 804), which is roughly 5.6 percent, then the net hike under MGNREGA comes to 5.4 percent.<br /><br />If one takes into account the inflation in Consumer Price Index Numbers for Rural Labourers (1986-87= 100) between January 2016 (CPIRL: 854) and January 2015 (CPIRL: 808), which is roughly 5.7 percent, then the net increase under MGNREGA would be 5.3 percent.<br /><br />Therefore, a 5 percent rise in MGNREGA expenditure over the last year&rsquo;s BE (in real sense) can be termed as modest, and not something overwhelming.<br /><br />Given the backlog of payments (particularly of delayed wage payments), which is yet to be paid to 21 states, the amount allocated under the MGNREGA under this year's budget is inadequate, according to many social activists and NGOs. Many states have been requesting since October 2015-16 for the release of promised and greater funds, against the backdrop of higher demand for work in drought-hit states. <br /><br />The Central Government owes 21 states Rs. 5,595 crore as dues for work done under the MGNREGA, says Nitin Sethi in his Business Standard article entitled <em>Govt bullish on MGNREGS, but bearish on funds</em>, which was published on 25 February, 2016 (please <a href="https://im4change.in/latest-news-updates/govt-bullish-on-mgnregs-but-bearish-on-funds-nitin-sethi-4678678.html" title="https://im4change.in/latest-news-updates/govt-bullish-on-mgnregs-but-bearish-on-funds-nitin-sethi-4678678.html">click here</a> to read).&nbsp;&nbsp;&nbsp; &nbsp;<br /><br />A Scroll.in article written by Anumeha Yadav dated 29 February, 2016 says that 21 states have no funds and pending liabilities of Rs 6,359 crore (please <a href="https://im4change.in/latest-news-updates/mnrega-once-again-jaitley-wrongly-claims-highest-ever-outlay-for-039monument-to-congress-failure039-anumeha-yadav-4678733.html" title="https://im4change.in/latest-news-updates/mnrega-once-again-jaitley-wrongly-claims-highest-ever-outlay-for-039monument-to-congress-failure039-anumeha-yadav-4678733.html">click here</a> to access). &nbsp;<br /><br />Civil society activists have alleged that in the past there were attempts to kill the MGNREGA by stealth. The size of expenditure allocation under the MGNREGA in 2016-17 has been kept so low that not even 30 man-days of employment could be created on an average for a household annually. <br /><br />Regarding the MGNREGA, CPI (M) has made the following tweet:<br /><br /><br /><blockquote><p dir="ltr"><a href="https://twitter.com/hashtag/Budget2016?src=hash" title="https://twitter.com/hashtag/Budget2016?src=hash">#Budget2016</a> Its a lie to say MNREGA allocation at all time high (38000 cr). Highest in 2010-11: 39377 cr, inflation adjusted 61445 cr.</p>&mdash; CPI (M) (@cpimspeak) <a href="https://twitter.com/cpimspeak/status/704265195749658624" title="https://twitter.com/cpimspeak/status/704265195749658624">February 29, 2016</a></blockquote><br /><br /><strong>Social Sector<br /></strong><br />From the CBGA report entitled <em>Connecting the Dots: An Analysis of Union Budget 2016-17</em>, one can discern that the proposed allocation to Sarva Shiksha Abhiyan (SSA) in 2016-17 was Rs. 22,500 crore (BE) as compared to the BE of Rs. 22,000 crore in 2015-16 (please <a href="https://im4change.in/siteadmin/tinymce/uploaded/Connecting%20the%20Dots%20-%20An%20Analysis%20of%20Union%20Budget%202016-17.pdf" title="Connecting the dots CBGA" title="https://im4change.in/siteadmin/tinymce/uploaded/Connecting%20the%20Dots%20-%20An%20Analysis%20of%20Union%20Budget%202016-17.pdf" title="Connecting the dots CBGA">click here</a> to access). <br /><br />However, the Union Government spending on education as a percentage of GDP has reduced from 0.50 percent in 2015-16 (RE) to 0.48 percent in 2016-17 (BE), as per CBGA calculations. Similarly, the Union Government spending on education as a percentage of total Union budget has fallen marginally from 3.8 percent in 2015-16 (RE) to 3.7 percent in 2016-17 (BE).<br /><br />As compared to the RE of Rs. 19,122.01 crore for the National Health Mission (NHM) during 2015-16, the allocation this year has been slightly curtailed to Rs. 19,037 crore (BE).<br /><br />The CBGA budget analysis report says that for the Rashtriya Swasthya Bima Yojana (RSBY), as compared to the RE of Rs. 658.8 crore during 2015-16, the allocation this year has been more than doubled to Rs. 1743.7 crore (BE). <br /><br />Dipa Sinha in her thewire.in article entitled <em>Neglecting Health Expenditure in Favour of the Chimera of Insurance</em>, dated 29 February, 2016 has informed us that despite the failure of RSBY in reducing out-of-pocket expenditure on healthcare by the poor, the FM has gone ahead to allocate more resources under the programme. However, the Government has not augmented the allocations for National Health Mission so as to build on the gains of the National Rural Health Mission (NRHM) (please <a href="http://thewire.in/2016/02/29/neglecting-health-expenditure-in-favour-of-the-chimera-of-insurance-23133/" title="http://thewire.in/2016/02/29/neglecting-health-expenditure-in-favour-of-the-chimera-of-insurance-23133/">click here</a> to read). &nbsp;<br /><br />A meagre sum of Rs. 35 crore (BE) has been allocated for the Jan Aushadhi scheme in 2016-17, which makes little or no sense given the fact that the out-of-pocket expenditure on medicines is over 60 percent of the health expenditure of an individual during 2011-12 [as has been shown by Indrani Gupta &amp; Samik Chowdhury (2015) in a working paper, please <a href="https://im4change.in/siteadmin/tinymce/uploaded/IEG%20Working%20Paper.pdf" title="https://im4change.in/siteadmin/tinymce/uploaded/IEG%20Working%20Paper.pdf">click here</a> to read].&nbsp; &nbsp;<br />&nbsp;<br />The expenditure on food subsidy has been slashed from Rs. 1,39,419 crore (RE) in 2015-16 to Rs. 1,34,835 crore (BE) in 2016-17, as per CBGA. As a consequence, the expenditure on food subsidy as a percentage of GDP has come down from 1.03 percent in 2015-16 (BE) to 0.9 percent in 2016-17 (BE). Similarly, the expenditure on food subsidy as a percentage of total Union Government expenditure has come down from 7.81 percent in 2015-16 (BE) to 6.82 percent in 2016-17 (BE). &nbsp;<br /><br />The proposed allocation to Integrated Child Development Services (ICDS) has been reduced from Rs. 15,587 crore (RE) in 2015-16 to Rs. 14,863 crore (BE) in 2016-17. However allocation for Mid Day Meal Scheme (MDMS) has been enhanced from Rs. 9,236.4 crore (RE) in 2015-16 to Rs. 9,700 crore (BE) in 2016-17, as per the recent CBGA report.<br /><br />Regarding cutbacks in the ICDS, CPI (M) has tweeted the following:<br /><br /><br /><blockquote><p dir="ltr"><a href="https://twitter.com/hashtag/Budget2016?src=hash" title="https://twitter.com/hashtag/Budget2016?src=hash">#Budget2016</a> Integrated Child Development Services (ICDS) Allocation cut by Rs 1483 crores (~10%).</p>&mdash; CPI (M) (@cpimspeak) <a href="https://twitter.com/cpimspeak/status/704252423548702725" title="https://twitter.com/cpimspeak/status/704252423548702725">February 29, 2016</a></blockquote></div><div align="justify"><br /><br />As per the CBGA, budget for children as a percentage of total Union budget has come down from 3.62 percent in 2015-16 (RE) to 3.32 percent in 2016-17 (BE). Similarly, budget for children as a percentage of GDP has declined from 0.48 percent in 2015-16 (RE) to 0.44 percent in 2016-17 (BE).<br /><br />CBGA in its report entitled <em>Connecting the Dots: An Analysis of Union Budget 2016-17 </em>has said that during 2016-17 (BE), the total allocation for social security of unorganized workers is Rs. 12,152.7 crore, which comes to around 0.6 percent of the total Union budget outlay and 0.08 percent of the GDP. Against the previous year's allocation of Rs. 11521.9 crore, the total allocation for social security of unorganized workers has increased by 5.5 percent (i.e. Rs. 630.8 crore) in 2016-17 (BE). <br /><br />The combined allocation for Pradhan Mantri Jeevan Jyoti Bima Yojana and Pradhan Mantri Suraksha Bima Yojana is Rs. 50 crore, says the CBGA report.<br />&nbsp;<br />The Aam Aadmi Bima Yojana, a life insurance scheme that also includes rural landless labourers as beneficiaries, has been allocated Rs. 450 crore. Since 56 percent of total rural households (10.08 crore out of 17.9 crore households) in the country do not own any land, the allocation could have been enhanced, says the CBGA report.<br /><br /><strong>Conclusion<br /></strong><br />Although the Union Budget 2016-17 has been appreciated by mainstream economists for following the agenda of fiscal consolidation so as to promote macroeconomic stability, for the exact same reason the budget has been labelled as neoliberal in nature by Left-oriented economists. The latter group of economists has opined that fiscal discipline in the face of recession could further contract national output, and hence affect tax collection. It is the social sector that has suffered the most due to the policy of fiscal prudence pursued in the recent years. &nbsp;<br /><br /><br /><strong>References:<br /></strong><br />CPIAL and CPIRL, Labour Bureau, please <a href="http://labourbureau.nic.in/indnum.htm" title="http://labourbureau.nic.in/indnum.htm">click here</a> to access&nbsp;<br /><br />Press Note: CPIAL and CPIRL, Labour Bureau, please <a href="http://labourbureau.nic.in/pressAL.html" title="http://labourbureau.nic.in/pressAL.html">click here</a> to access<br />&nbsp;<br />The Poor Badly Needed a Good Budget this Year. Well, They Didn&rsquo;t Get It. -Bharat Dogra, TheWire.in, 29 February, 2016, please <a href="https://im4change.in/latest-news-updates/the-poor-badly-needed-a-good-budget-this-year-well-they-didnt-get-it-bharat-dogra-4678716.html" title="https://im4change.in/latest-news-updates/the-poor-badly-needed-a-good-budget-this-year-well-they-didnt-get-it-bharat-dogra-4678716.html">click here</a> to access <br /><br />Budget expectations for rural sector, please <a href="https://im4change.in/news-alerts/budget-expectations-for-rural-sector-4678693.html" title="https://im4change.in/news-alerts/budget-expectations-for-rural-sector-4678693.html">click here</a> to access<br /><br />14th Finance Commission (FFC) Report tabled in Parliament, Press Information Bureau, Government of India, Ministry of Finance, 24 February, 2015, please <a href="http://pib.nic.in/newsite/PrintRelease.aspx?relid=115810" title="http://pib.nic.in/newsite/PrintRelease.aspx?relid=115810">click here</a> to access <br /><br />Note on Demands for Grants for Department of Agriculture, Cooperation and Farmers' Welfare (2016-17), Ministry of Agriculture, please <a href="http://indiabudget.nic.in/ub2016-17/eb/sbe1.pdf" title="http://indiabudget.nic.in/ub2016-17/eb/sbe1.pdf">click here</a> to access <br /><br />Note on Demands for Grants for Department of Financial Services (2015-16), Ministry of Finance, please <a href="http://indiabudget.nic.in/budget2015-2016/ub2015-16/eb/sbe35.pdf" title="http://indiabudget.nic.in/budget2015-2016/ub2015-16/eb/sbe35.pdf">click here</a> to access <br /><br />UPA&rsquo;s flagship MGNREGA receives a fresh lease of life -Harish Damodaran, The Indian Express, 1 March, 2016, please <a href="https://im4change.in/latest-news-updates/upas-flagship-mgnrega-receives-a-fresh-lease-of-life-harish-damodaran-4678730.html" title="https://im4change.in/latest-news-updates/upas-flagship-mgnrega-receives-a-fresh-lease-of-life-harish-damodaran-4678730.html">click here</a> to access <br /><br />Pretending to be pro-poor, little change over UPA -Arun Kumar, The Tribune, 1 March, 2016, please <a href="https://im4change.in/latest-news-updates/pretending-to-be-pro-poor-little-change-over-upa-arun-kumar-4678728.html" title="https://im4change.in/latest-news-updates/pretending-to-be-pro-poor-little-change-over-upa-arun-kumar-4678728.html">click here</a> to access <br /><br />The Union Budget&rsquo;s political message -Smita Gupta, The Hindu, 1 March, 2016, please <a href="https://im4change.in/latest-news-updates/the-union-budgets-political-message-smita-gupta-4678724.html" title="https://im4change.in/latest-news-updates/the-union-budgets-political-message-smita-gupta-4678724.html">click here</a> to access <br /><br />No Gamechangers For Farmers -Ashok Gulati, The Indian Express, 1 March, 2016, please <a href="https://im4change.in/latest-news-updates/no-gamechangers-for-farmers-ashok-gulati-4678722.html" title="https://im4change.in/latest-news-updates/no-gamechangers-for-farmers-ashok-gulati-4678722.html">click here</a> to access <br /><br />Applause and the fine print -Devadeep Purohit, The Telegraph, 1 March, 2016, please <a href="https://im4change.in/latest-news-updates/applause-and-the-fine-print-devadeep-purohit-4678721.html" title="https://im4change.in/latest-news-updates/applause-and-the-fine-print-devadeep-purohit-4678721.html">click here</a> to access <br /><br />By no means a &lsquo;socialist&rsquo; Budget -G Sampath, The Hindu, 1 March, 2016, please <a href="https://im4change.in/latest-news-updates/by-no-means-a-socialist-budget-g-sampath-4678720.html" title="https://im4change.in/latest-news-updates/by-no-means-a-socialist-budget-g-sampath-4678720.html">click here</a> to access <br /><br />Just another trivial Budget -Ashok V Desai, The Hindu, 1 March, 2016, please <a href="https://im4change.in/latest-news-updates/just-another-trivial-budget-ashok-v-desai-4678718.html" title="https://im4change.in/latest-news-updates/just-another-trivial-budget-ashok-v-desai-4678718.html">click here</a> to read&nbsp; <br /><br />Government tries to harvest success with farmer-friendly Budget -Richard Mahapatra, Down to Earth, 29 February, 2016, please <a href="https://im4change.in/latest-news-updates/government-tries-to-harvest-success-with-farmer-friendly-budget-richard-mahapatra-4678719.html" title="https://im4change.in/latest-news-updates/government-tries-to-harvest-success-with-farmer-friendly-budget-richard-mahapatra-4678719.html">click here</a> to read more <br /><br />'Too little' tag on rural job scheme raise, The Telegraph, 29 February, 2016, please <a href="https://im4change.in/latest-news-updates/039too-little039-tag-on-rural-job-scheme-raise-4678732.html" title="https://im4change.in/latest-news-updates/039too-little039-tag-on-rural-job-scheme-raise-4678732.html">click here</a> to access <br /></div><div align="justify">&nbsp;</div><div align="justify"><strong>Image Courtesy: MKSS</strong> <br /></div>                                                           
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        NEWS ALERTS | Union Budget 2016-17: Mere eyewash or some concrete steps    </title>
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In the age of social media, various sections of the Indian polity and civil society have reacted publicly in diverse voices, following the presentation of the Union Budget 2016-17 by Finance Minister Shri Arun Jaitley.

An assessment of the Union Budget..."/>
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In the age of social media, various sections of the Indian polity and civil society have reacted publicly in diverse voices, following the presentation of the Union Budget 2016-17 by Finance Minister Shri Arun Jaitley.

An assessment of the Union Budget..." />
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    <h1 class="cat-box-title">Union Budget 2016-17: Mere eyewash or some concrete steps</h1>
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                            <br /><div align="justify">In the age of social media, various sections of the Indian polity and civil society have reacted publicly in diverse voices, following the presentation of the <a href="https://im4change.in/empowerment/union-budget-73.html?pgno=2#union-budget-2016-17" title="https://im4change.in/empowerment/union-budget-73.html?pgno=2#union-budget-2016-17">Union Budget 2016-17</a> by Finance Minister Shri Arun Jaitley.<br /><br />An assessment of the Union Budget 2016-17 has been done in the following paragraphs by the Inclusive Media for Change team, based on a number of media reports, Government documents (including the Budget documents), and reports prepared by CSOs. <br /><br /><strong>Public Finance<br /></strong><br />Although the Budget documents (please <a href="http://indiabudget.nic.in/ub2016-17/bag/bag11.pdf" title="http://indiabudget.nic.in/ub2016-17/bag/bag11.pdf">click here</a> to read) show that the budgetary estimates of tax revenue (net to centre) i.e. Rs. 9,19,842 crore was lesser than the revised estimates of Rs. 9,47,508 crore during 2015-16, in his retweet P Chidambaram (@PChidambaram_IN) has said the following: <br /><br /><br /><blockquote><p dir="ltr">The whopping increase in tax collected was due to the several times govt hiked excise duty on petrol &amp; diesel: <a href="https://twitter.com/PChidambaram_IN" title="https://twitter.com/PChidambaram_IN">@PChidambaram_IN</a></p>&mdash; INC India (@INCIndia) <a href="https://twitter.com/INCIndia/status/704264102437216256" title="https://twitter.com/INCIndia/status/704264102437216256">February 29, 2016</a></blockquote><br /><br />In the recent past, many economists had alleged that the Government did not pass the benefit of lower international crude prices to domestic consumers. <br /><br />Likewise the Economic Times (@EconomicTimes), after the Union Budget presentation, has retweeted the following message: <br /><br /><br /><blockquote><p dir="ltr">Govt boasting they collected more tax than ever. It was only due to excise on Crude. Not from Corporation or Income tax: <a href="https://twitter.com/PChidambaram_IN" title="https://twitter.com/PChidambaram_IN">@PChidambaram_IN</a></p>&mdash; EconomicTimes (@EconomicTimes) <a href="https://twitter.com/EconomicTimes/status/704264388065112065" title="https://twitter.com/EconomicTimes/status/704264388065112065">February 29, 2016</a></blockquote><br /><br />The concerns appear valid because from the Budget documents (please <a href="http://indiabudget.nic.in/ub2016-17/bag/bag2.pdf" title="http://indiabudget.nic.in/ub2016-17/bag/bag2.pdf">click here</a> to read) it could be observed that the RE of both corporation tax and income tax revenue fell below the budgetary estimates during 2015-16. However, RE was much greater than BE for tax revenue collected through Union Excise Duties in that year.<br /><br />CPI (M) General Secretary Sitaram Yechury (@SitaramYechury) has tweeted the following messages regarding Government's reliance on indirect taxes instead of direct taxes for revenue collection:<br /><br /><br /><blockquote><p dir="ltr">Increasing cess hurts the common man, with indirect tax collections proposed to be up by 20,600 cr. Direct tax proposals are down by 1060 cr</p>&mdash; Sitaram Yechury (@SitaramYechury) <a href="https://twitter.com/SitaramYechury/status/704240871164645376" title="https://twitter.com/SitaramYechury/status/704240871164645376">February 29, 2016</a></blockquote><br /><br /><blockquote><p dir="ltr">This means more burden on common people as indirect taxes are inflationary. So there will be no expansion in domestic demand.</p>&mdash; Sitaram Yechury (@SitaramYechury) <a href="https://twitter.com/SitaramYechury/status/704241179945099264" title="https://twitter.com/SitaramYechury/status/704241179945099264">February 29, 2016</a></blockquote></div><div align="justify"><br /><br />The FM in his budget speech has informed us that the fiscal deficit in RE 2015-16 and BE 2016-17 have been retained at 3.9 percent and 3.5 percent of GDP, respectively. In his opinion piece entitled: <em>Why the Budget numbers don&rsquo;t add up</em>, which was published in The Hindu dated 1 March, 2016, Dr. Rohit Azad, who teaches at JNU, has said that the fiscal deficit as a percentage of GDP has been brought down by increasing the collection of indirect taxes and excise duties, even as the non-plan expenditure went down (please <a href="https://im4change.in/latest-news-updates/why-the-budget-numbers-dont-add-up-rohit-azad-4678723.html" title="https://im4change.in/latest-news-updates/why-the-budget-numbers-dont-add-up-rohit-azad-4678723.html">click here</a> to read). <br /><br />An Analysis of the Union Budget 2016-17 by Centre for Budget and Governance Accountability (CBGA) in a report entitled <em>Connecting the Dots </em>has revealed that during 2016-17 (BE) the proportion of direct taxes and indirect taxes in the gross central taxes is estimated at 52:48, as compared to the ratio of 56:44 during 2014-15. Although indirect taxes are considered to be regressive in nature, the Central Government is increasingly getting dependent on indirect taxes.&nbsp; &nbsp;<br /></div><div align="justify">&nbsp;</div><div align="justify">The Fourteenth Finance Commission recommended to devolve 42 percent of the net proceeds of the Union tax revenues to states, against 32 percent suggested by the Thirteenth Finance Commission. However, due to the imposition of various types of cess and surcharge in the 2016-17 Union budget such as Krishi Kalyan cess, Education cess, Swachh Bharat cess, Clean Energy cess etc., states&rsquo; share in the divisible pool is likely to be 37 percent, instead of 42 percent. It is because cess / surcharges collected goes directly to the Centre, and not to the states.&nbsp; &nbsp;<br /><br />Prof. Jayati Ghosh in her Indian Express article dated 2 March, 2016 has said that during 2015-16 the share of states in the divisible pool has declined from the projected 36.3 percent of tax revenues to 34.8 percent (please <a href="http://indianexpress.com/article/opinion/columns/hype-and-reality-of-budget-2016/" title="http://indianexpress.com/article/opinion/columns/hype-and-reality-of-budget-2016/">click here</a> to read).<br /><br /><strong>Farm incomes<br /></strong><br />The BJP in its 2014 election manifesto (please <a href="http://www.bjp.org/images/pdf_2014/full_manifesto_english_07.04.2014.pdf" title="http://www.bjp.org/images/pdf_2014/full_manifesto_english_07.04.2014.pdf">click here</a> to read) had declared that if voted to power it will <em>&quot;take steps to enhance the profitability in agriculture, by ensuring a minimum of 50% profits over the cost of production, cheaper agriculture inputs and credit; introducing latest technologies for farming and high yielding seeds and linking MGNREGA&nbsp; to agriculture&quot;</em>, among other things. <br /><br />P Chidambaram has made the following tweets regarding NDA&rsquo;s promise of fair and remunerative minimum support price (MSP) of agricultural commodities: </div><div align="justify">&nbsp;</div><div align="justify"><br /><blockquote><p dir="ltr">It did worse last year by giving meagre<br />or nil increases in MSP. Budget speech makes no promise of fair &amp; remunerative MSP: <a href="https://twitter.com/PChidambaram_IN" title="https://twitter.com/PChidambaram_IN">@PChidambaram_IN</a></p>&mdash; INC India (@INCIndia) <a href="https://twitter.com/INCIndia/status/704269608841146368" title="https://twitter.com/INCIndia/status/704269608841146368">February 29, 2016</a></blockquote><br /><br /><blockquote><p dir="ltr">On Agri, I am happy that UPA schemes are being continued, but crucial signal is 'Price'. NDA reneged on its<br />promise to give cost plus 50%</p>&mdash; INC India (@INCIndia) <a href="https://twitter.com/INCIndia/status/704269264102887424" title="https://twitter.com/INCIndia/status/704269264102887424">February 29, 2016</a></blockquote><br /><br />The Communist Party of India (Marxist) (@cpimspeak) has made the following tweet regarding NDA&rsquo;s commitment to reduce farm distress:<br /><br /><blockquote><p dir="ltr"><a href="https://twitter.com/hashtag/Budget2016?src=hash" title="https://twitter.com/hashtag/Budget2016?src=hash">#Budget2016</a> Govt talks about doubling farm income by 2022 but not a single reference to thousands of farmer suicides.</p>&mdash; CPI (M) (@cpimspeak) <a href="https://twitter.com/cpimspeak/status/704219581989019648" title="https://twitter.com/cpimspeak/status/704219581989019648">February 29, 2016</a></blockquote><br /><br />In his budget speech, the FM has said that 3 specific initiatives will be taken up in 2016-17 so that the benefit of MSP reaches farmers in all parts of the country. First, the remaining states will be encouraged to take up decentralized procurement. Second, an online Procurement System will be undertaken through the Food Corporation of India so as to usher in transparency and convenience to the farmers through prior registration and monitoring of actual procurement. Third, effective arrangements have been made for pulses procurement. <br /><br />The FM in his budget speech has said that the Government is implementing the Unified Agriculture Marketing Scheme, which envisages a common e-market platform that will be deployed in selected 585 regulated wholesale markets. <br /><br />It is, however, not clear whether the policy of public procurement of foodgrains will be replaced slowly overtime by such open market online trading. The Government&rsquo;s commitment towards providing minimum support prices and remunerative prices for farmers becomes doubtful in the light of the Economic Survey 2015-16 recommending to replace the present system of MSP/ procurement based public distribution system (PDS) with direct benefit transfer (DBT) and freeing the market of all controls on domestic movement and import (please check the <em>chapter 5: Prices, Agriculture and Food Management</em>, Economic Survey 2015-16, Vol-2, please <a href="http://indiabudget.nic.in/es2015-16/echapvol2-05.pdf" title="http://indiabudget.nic.in/es2015-16/echapvol2-05.pdf">click here</a> to read). <br /><br />Although at first glance it may seem that the allocation to Department of Agriculture, Cooperation and Farmers Welfare (under the Ministry of Agriculture) has been more than doubled from Rs. 15803.04 crore (RE) in 2015-16 to Rs. 35968.79 crore (BE) in 2016-17 (as could be seen from the Expenditure Budget Volume I, please <a href="http://indiabudget.nic.in/ub2016-17/eb/stat02.pdf" title="http://indiabudget.nic.in/ub2016-17/eb/stat02.pdf">click here</a> to access), various public finance experts such as Prof. CP Chandrasekhar and Prof. Jayati Ghosh have argued that it has happened because the head 'interest subsidy for short term credit to farmers', which earlier came as part of the demand-for-grants of the Ministry of Finance, has been moved to the Ministry of Agriculture (please <a href="https://im4change.in/latest-news-updates/the-human-face-of-budget-2016-17-cp-chandrasekhar-4678726.html" title="https://im4change.in/latest-news-updates/the-human-face-of-budget-2016-17-cp-chandrasekhar-4678726.html">click here</a> to read). <br /><br />Likewise many other heads / schemes have been moved from one ministry to another, thus, creating the illusion that budgetary allocations have been increased for certain ministries or departments.<br /><br />For the Pradhan Mantri Fasal Bima Yojana (PMFBY), the budgetary allocation has been raised from Rs. 2,955 crore (RE) in 2015-16 to Rs. 5,501 crore (BE) in 2016-17. It has been alleged by farmers' organizations that the recently launched PMFBY is a dressed-up version of two existing schemes, viz. National Agricultural Insurance Scheme (NAIS) and the Modified NAIS (MNAIS). The claim that the new crop insurance scheme has reduced premium is not true since the existing NAIS, which has fairly low premiums of 1.5-3.5 percent for foodgrains and oilseeds crops and actuarial rates for horticultural and cash crops, is already running in 14 states. For a critical understanding of PMFBY, one can consult the article entitled <em>Here is why farmers' rights groups are unhappy with PM Modi's insurance scheme for them</em>, which has been written by Yogesh Pawar for DNA, dated: 17 January, 2016 (please <a href="https://im4change.in/latest-news-updates/here-is-why-farmers039-rights-groups-are-unhappy-with-pm-modi039s-insurance-scheme-for-them-yogesh-pawar-4678366.html" title="https://im4change.in/latest-news-updates/here-is-why-farmers039-rights-groups-are-unhappy-with-pm-modi039s-insurance-scheme-for-them-yogesh-pawar-4678366.html">click here</a> to read). <br /><br />Prior to the budget, the Swaraj Abhiyan criticized the PMFBY by saying that when there is crop loss, the same yield-based assessment arbitrarily decided by <em>patwaris </em>will apply (please <a href="https://im4change.in/latest-news-updates/new-insurance-scheme-has-nothing-for-farmers-swaraj-abhiyan-4678624.html" title="https://im4change.in/latest-news-updates/new-insurance-scheme-has-nothing-for-farmers-swaraj-abhiyan-4678624.html">click here</a> to read). <br /><br />Some of the tweets made by Opposition regarding the provision for farm sector under the budget, are as follows:<br /><br /><br /><blockquote><p dir="ltr">BJP forgets its own promises of fixing MSPs. Their promise that farmers will make at least 50% profit on their investment remains forgotten.</p>&mdash; INC India (@INCIndia) <a href="https://twitter.com/INCIndia/status/704362103021240321" title="https://twitter.com/INCIndia/status/704362103021240321">February 29, 2016</a></blockquote><br /><br /><blockquote><p dir="ltr">It did worse last year by giving meagre<br />or nil increases in MSP. Budget speech makes no promise of fair &amp; remunerative MSP: <a href="https://twitter.com/PChidambaram_IN" title="https://twitter.com/PChidambaram_IN">@PChidambaram_IN</a></p>&mdash; INC India (@INCIndia) <a href="https://twitter.com/INCIndia/status/704269608841146368" title="https://twitter.com/INCIndia/status/704269608841146368">February 29, 2016</a></blockquote><br /><br /><blockquote><p dir="ltr">Former Prime Minister Dr Manmohan Singh's reaction to <a href="https://twitter.com/hashtag/Budget2016?src=hash" title="https://twitter.com/hashtag/Budget2016?src=hash">#Budget2016</a> <a href="https://t.co/fhCP3ZdlOo" title="https://t.co/fhCP3ZdlOo">pic.twitter.com/fhCP3ZdlOo</a></p>&mdash; INC India (@INCIndia) <a href="https://twitter.com/INCIndia/status/704276665656946689" title="https://twitter.com/INCIndia/status/704276665656946689">February 29, 2016</a></blockquote><br /><br /><strong>MGNREGA<br /></strong><br />The FM has proposed to allocate Rs. 38,500 crore for MGNREGA during 2016-17. The budgetary estimate last year was Rs. 34,699 and the RE was Rs. 36,967 crore (please <a href="http://indiabudget.nic.in/ub2016-17/eb/sbe75.pdf" title="http://indiabudget.nic.in/ub2016-17/eb/sbe75.pdf">click here</a> to read). As compared to last year's BE, the allocation in 2016-17 has been hiked by nearly 11 percent. However, if one takes into account the inflation in Consumer Price Index (combined) between January 2016 and January 2015, which is roughly 5.7 percent (please <a href="http://mospi.nic.in/Mospi_New/upload/cpi_pr_12feb16f.pdf" title="http://mospi.nic.in/Mospi_New/upload/cpi_pr_12feb16f.pdf">click here</a> to read), then the net hike under MGNREGA is around 5.3 percent. &nbsp;<br /><br />If one takes into account the inflation in Consumer Price Index Numbers for Agricultural Labourers (1986-87= 100) between January 2016 (CPIAL: 849) and January 2015 (CPIAL: 804), which is roughly 5.6 percent, then the net hike under MGNREGA comes to 5.4 percent.<br /><br />If one takes into account the inflation in Consumer Price Index Numbers for Rural Labourers (1986-87= 100) between January 2016 (CPIRL: 854) and January 2015 (CPIRL: 808), which is roughly 5.7 percent, then the net increase under MGNREGA would be 5.3 percent.<br /><br />Therefore, a 5 percent rise in MGNREGA expenditure over the last year&rsquo;s BE (in real sense) can be termed as modest, and not something overwhelming.<br /><br />Given the backlog of payments (particularly of delayed wage payments), which is yet to be paid to 21 states, the amount allocated under the MGNREGA under this year's budget is inadequate, according to many social activists and NGOs. Many states have been requesting since October 2015-16 for the release of promised and greater funds, against the backdrop of higher demand for work in drought-hit states. <br /><br />The Central Government owes 21 states Rs. 5,595 crore as dues for work done under the MGNREGA, says Nitin Sethi in his Business Standard article entitled <em>Govt bullish on MGNREGS, but bearish on funds</em>, which was published on 25 February, 2016 (please <a href="https://im4change.in/latest-news-updates/govt-bullish-on-mgnregs-but-bearish-on-funds-nitin-sethi-4678678.html" title="https://im4change.in/latest-news-updates/govt-bullish-on-mgnregs-but-bearish-on-funds-nitin-sethi-4678678.html">click here</a> to read).&nbsp;&nbsp;&nbsp; &nbsp;<br /><br />A Scroll.in article written by Anumeha Yadav dated 29 February, 2016 says that 21 states have no funds and pending liabilities of Rs 6,359 crore (please <a href="https://im4change.in/latest-news-updates/mnrega-once-again-jaitley-wrongly-claims-highest-ever-outlay-for-039monument-to-congress-failure039-anumeha-yadav-4678733.html" title="https://im4change.in/latest-news-updates/mnrega-once-again-jaitley-wrongly-claims-highest-ever-outlay-for-039monument-to-congress-failure039-anumeha-yadav-4678733.html">click here</a> to access). &nbsp;<br /><br />Civil society activists have alleged that in the past there were attempts to kill the MGNREGA by stealth. The size of expenditure allocation under the MGNREGA in 2016-17 has been kept so low that not even 30 man-days of employment could be created on an average for a household annually. <br /><br />Regarding the MGNREGA, CPI (M) has made the following tweet:<br /><br /><br /><blockquote><p dir="ltr"><a href="https://twitter.com/hashtag/Budget2016?src=hash" title="https://twitter.com/hashtag/Budget2016?src=hash">#Budget2016</a> Its a lie to say MNREGA allocation at all time high (38000 cr). Highest in 2010-11: 39377 cr, inflation adjusted 61445 cr.</p>&mdash; CPI (M) (@cpimspeak) <a href="https://twitter.com/cpimspeak/status/704265195749658624" title="https://twitter.com/cpimspeak/status/704265195749658624">February 29, 2016</a></blockquote><br /><br /><strong>Social Sector<br /></strong><br />From the CBGA report entitled <em>Connecting the Dots: An Analysis of Union Budget 2016-17</em>, one can discern that the proposed allocation to Sarva Shiksha Abhiyan (SSA) in 2016-17 was Rs. 22,500 crore (BE) as compared to the BE of Rs. 22,000 crore in 2015-16 (please <a href="https://im4change.in/siteadmin/tinymce/uploaded/Connecting%20the%20Dots%20-%20An%20Analysis%20of%20Union%20Budget%202016-17.pdf" title="Connecting the dots CBGA" title="https://im4change.in/siteadmin/tinymce/uploaded/Connecting%20the%20Dots%20-%20An%20Analysis%20of%20Union%20Budget%202016-17.pdf" title="Connecting the dots CBGA">click here</a> to access). <br /><br />However, the Union Government spending on education as a percentage of GDP has reduced from 0.50 percent in 2015-16 (RE) to 0.48 percent in 2016-17 (BE), as per CBGA calculations. Similarly, the Union Government spending on education as a percentage of total Union budget has fallen marginally from 3.8 percent in 2015-16 (RE) to 3.7 percent in 2016-17 (BE).<br /><br />As compared to the RE of Rs. 19,122.01 crore for the National Health Mission (NHM) during 2015-16, the allocation this year has been slightly curtailed to Rs. 19,037 crore (BE).<br /><br />The CBGA budget analysis report says that for the Rashtriya Swasthya Bima Yojana (RSBY), as compared to the RE of Rs. 658.8 crore during 2015-16, the allocation this year has been more than doubled to Rs. 1743.7 crore (BE). <br /><br />Dipa Sinha in her thewire.in article entitled <em>Neglecting Health Expenditure in Favour of the Chimera of Insurance</em>, dated 29 February, 2016 has informed us that despite the failure of RSBY in reducing out-of-pocket expenditure on healthcare by the poor, the FM has gone ahead to allocate more resources under the programme. However, the Government has not augmented the allocations for National Health Mission so as to build on the gains of the National Rural Health Mission (NRHM) (please <a href="http://thewire.in/2016/02/29/neglecting-health-expenditure-in-favour-of-the-chimera-of-insurance-23133/" title="http://thewire.in/2016/02/29/neglecting-health-expenditure-in-favour-of-the-chimera-of-insurance-23133/">click here</a> to read). &nbsp;<br /><br />A meagre sum of Rs. 35 crore (BE) has been allocated for the Jan Aushadhi scheme in 2016-17, which makes little or no sense given the fact that the out-of-pocket expenditure on medicines is over 60 percent of the health expenditure of an individual during 2011-12 [as has been shown by Indrani Gupta &amp; Samik Chowdhury (2015) in a working paper, please <a href="https://im4change.in/siteadmin/tinymce/uploaded/IEG%20Working%20Paper.pdf" title="https://im4change.in/siteadmin/tinymce/uploaded/IEG%20Working%20Paper.pdf">click here</a> to read].&nbsp; &nbsp;<br />&nbsp;<br />The expenditure on food subsidy has been slashed from Rs. 1,39,419 crore (RE) in 2015-16 to Rs. 1,34,835 crore (BE) in 2016-17, as per CBGA. As a consequence, the expenditure on food subsidy as a percentage of GDP has come down from 1.03 percent in 2015-16 (BE) to 0.9 percent in 2016-17 (BE). Similarly, the expenditure on food subsidy as a percentage of total Union Government expenditure has come down from 7.81 percent in 2015-16 (BE) to 6.82 percent in 2016-17 (BE). &nbsp;<br /><br />The proposed allocation to Integrated Child Development Services (ICDS) has been reduced from Rs. 15,587 crore (RE) in 2015-16 to Rs. 14,863 crore (BE) in 2016-17. However allocation for Mid Day Meal Scheme (MDMS) has been enhanced from Rs. 9,236.4 crore (RE) in 2015-16 to Rs. 9,700 crore (BE) in 2016-17, as per the recent CBGA report.<br /><br />Regarding cutbacks in the ICDS, CPI (M) has tweeted the following:<br /><br /><br /><blockquote><p dir="ltr"><a href="https://twitter.com/hashtag/Budget2016?src=hash" title="https://twitter.com/hashtag/Budget2016?src=hash">#Budget2016</a> Integrated Child Development Services (ICDS) Allocation cut by Rs 1483 crores (~10%).</p>&mdash; CPI (M) (@cpimspeak) <a href="https://twitter.com/cpimspeak/status/704252423548702725" title="https://twitter.com/cpimspeak/status/704252423548702725">February 29, 2016</a></blockquote></div><div align="justify"><br /><br />As per the CBGA, budget for children as a percentage of total Union budget has come down from 3.62 percent in 2015-16 (RE) to 3.32 percent in 2016-17 (BE). Similarly, budget for children as a percentage of GDP has declined from 0.48 percent in 2015-16 (RE) to 0.44 percent in 2016-17 (BE).<br /><br />CBGA in its report entitled <em>Connecting the Dots: An Analysis of Union Budget 2016-17 </em>has said that during 2016-17 (BE), the total allocation for social security of unorganized workers is Rs. 12,152.7 crore, which comes to around 0.6 percent of the total Union budget outlay and 0.08 percent of the GDP. Against the previous year's allocation of Rs. 11521.9 crore, the total allocation for social security of unorganized workers has increased by 5.5 percent (i.e. Rs. 630.8 crore) in 2016-17 (BE). <br /><br />The combined allocation for Pradhan Mantri Jeevan Jyoti Bima Yojana and Pradhan Mantri Suraksha Bima Yojana is Rs. 50 crore, says the CBGA report.<br />&nbsp;<br />The Aam Aadmi Bima Yojana, a life insurance scheme that also includes rural landless labourers as beneficiaries, has been allocated Rs. 450 crore. Since 56 percent of total rural households (10.08 crore out of 17.9 crore households) in the country do not own any land, the allocation could have been enhanced, says the CBGA report.<br /><br /><strong>Conclusion<br /></strong><br />Although the Union Budget 2016-17 has been appreciated by mainstream economists for following the agenda of fiscal consolidation so as to promote macroeconomic stability, for the exact same reason the budget has been labelled as neoliberal in nature by Left-oriented economists. The latter group of economists has opined that fiscal discipline in the face of recession could further contract national output, and hence affect tax collection. It is the social sector that has suffered the most due to the policy of fiscal prudence pursued in the recent years. &nbsp;<br /><br /><br /><strong>References:<br /></strong><br />CPIAL and CPIRL, Labour Bureau, please <a href="http://labourbureau.nic.in/indnum.htm" title="http://labourbureau.nic.in/indnum.htm">click here</a> to access&nbsp;<br /><br />Press Note: CPIAL and CPIRL, Labour Bureau, please <a href="http://labourbureau.nic.in/pressAL.html" title="http://labourbureau.nic.in/pressAL.html">click here</a> to access<br />&nbsp;<br />The Poor Badly Needed a Good Budget this Year. Well, They Didn&rsquo;t Get It. -Bharat Dogra, TheWire.in, 29 February, 2016, please <a href="https://im4change.in/latest-news-updates/the-poor-badly-needed-a-good-budget-this-year-well-they-didnt-get-it-bharat-dogra-4678716.html" title="https://im4change.in/latest-news-updates/the-poor-badly-needed-a-good-budget-this-year-well-they-didnt-get-it-bharat-dogra-4678716.html">click here</a> to access <br /><br />Budget expectations for rural sector, please <a href="https://im4change.in/news-alerts/budget-expectations-for-rural-sector-4678693.html" title="https://im4change.in/news-alerts/budget-expectations-for-rural-sector-4678693.html">click here</a> to access<br /><br />14th Finance Commission (FFC) Report tabled in Parliament, Press Information Bureau, Government of India, Ministry of Finance, 24 February, 2015, please <a href="http://pib.nic.in/newsite/PrintRelease.aspx?relid=115810" title="http://pib.nic.in/newsite/PrintRelease.aspx?relid=115810">click here</a> to access <br /><br />Note on Demands for Grants for Department of Agriculture, Cooperation and Farmers' Welfare (2016-17), Ministry of Agriculture, please <a href="http://indiabudget.nic.in/ub2016-17/eb/sbe1.pdf" title="http://indiabudget.nic.in/ub2016-17/eb/sbe1.pdf">click here</a> to access <br /><br />Note on Demands for Grants for Department of Financial Services (2015-16), Ministry of Finance, please <a href="http://indiabudget.nic.in/budget2015-2016/ub2015-16/eb/sbe35.pdf" title="http://indiabudget.nic.in/budget2015-2016/ub2015-16/eb/sbe35.pdf">click here</a> to access <br /><br />UPA&rsquo;s flagship MGNREGA receives a fresh lease of life -Harish Damodaran, The Indian Express, 1 March, 2016, please <a href="https://im4change.in/latest-news-updates/upas-flagship-mgnrega-receives-a-fresh-lease-of-life-harish-damodaran-4678730.html" title="https://im4change.in/latest-news-updates/upas-flagship-mgnrega-receives-a-fresh-lease-of-life-harish-damodaran-4678730.html">click here</a> to access <br /><br />Pretending to be pro-poor, little change over UPA -Arun Kumar, The Tribune, 1 March, 2016, please <a href="https://im4change.in/latest-news-updates/pretending-to-be-pro-poor-little-change-over-upa-arun-kumar-4678728.html" title="https://im4change.in/latest-news-updates/pretending-to-be-pro-poor-little-change-over-upa-arun-kumar-4678728.html">click here</a> to access <br /><br />The Union Budget&rsquo;s political message -Smita Gupta, The Hindu, 1 March, 2016, please <a href="https://im4change.in/latest-news-updates/the-union-budgets-political-message-smita-gupta-4678724.html" title="https://im4change.in/latest-news-updates/the-union-budgets-political-message-smita-gupta-4678724.html">click here</a> to access <br /><br />No Gamechangers For Farmers -Ashok Gulati, The Indian Express, 1 March, 2016, please <a href="https://im4change.in/latest-news-updates/no-gamechangers-for-farmers-ashok-gulati-4678722.html" title="https://im4change.in/latest-news-updates/no-gamechangers-for-farmers-ashok-gulati-4678722.html">click here</a> to access <br /><br />Applause and the fine print -Devadeep Purohit, The Telegraph, 1 March, 2016, please <a href="https://im4change.in/latest-news-updates/applause-and-the-fine-print-devadeep-purohit-4678721.html" title="https://im4change.in/latest-news-updates/applause-and-the-fine-print-devadeep-purohit-4678721.html">click here</a> to access <br /><br />By no means a &lsquo;socialist&rsquo; Budget -G Sampath, The Hindu, 1 March, 2016, please <a href="https://im4change.in/latest-news-updates/by-no-means-a-socialist-budget-g-sampath-4678720.html" title="https://im4change.in/latest-news-updates/by-no-means-a-socialist-budget-g-sampath-4678720.html">click here</a> to access <br /><br />Just another trivial Budget -Ashok V Desai, The Hindu, 1 March, 2016, please <a href="https://im4change.in/latest-news-updates/just-another-trivial-budget-ashok-v-desai-4678718.html" title="https://im4change.in/latest-news-updates/just-another-trivial-budget-ashok-v-desai-4678718.html">click here</a> to read&nbsp; <br /><br />Government tries to harvest success with farmer-friendly Budget -Richard Mahapatra, Down to Earth, 29 February, 2016, please <a href="https://im4change.in/latest-news-updates/government-tries-to-harvest-success-with-farmer-friendly-budget-richard-mahapatra-4678719.html" title="https://im4change.in/latest-news-updates/government-tries-to-harvest-success-with-farmer-friendly-budget-richard-mahapatra-4678719.html">click here</a> to read more <br /><br />'Too little' tag on rural job scheme raise, The Telegraph, 29 February, 2016, please <a href="https://im4change.in/latest-news-updates/039too-little039-tag-on-rural-job-scheme-raise-4678732.html" title="https://im4change.in/latest-news-updates/039too-little039-tag-on-rural-job-scheme-raise-4678732.html">click here</a> to access <br /></div><div align="justify">&nbsp;</div><div align="justify"><strong>Image Courtesy: MKSS</strong> <br /></div>                                                           
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        NEWS ALERTS | Union Budget 2016-17: Mere eyewash or some concrete steps    </title>
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In the age of social media, various sections of the Indian polity and civil society have reacted publicly in diverse voices, following the presentation of the Union Budget 2016-17 by Finance Minister Shri Arun Jaitley.

An assessment of the Union Budget..."/>
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In the age of social media, various sections of the Indian polity and civil society have reacted publicly in diverse voices, following the presentation of the Union Budget 2016-17 by Finance Minister Shri Arun Jaitley.

An assessment of the Union Budget..." />
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    <h1 class="cat-box-title">Union Budget 2016-17: Mere eyewash or some concrete steps</h1>
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                            <br /><div align="justify">In the age of social media, various sections of the Indian polity and civil society have reacted publicly in diverse voices, following the presentation of the <a href="https://im4change.in/empowerment/union-budget-73.html?pgno=2#union-budget-2016-17" title="https://im4change.in/empowerment/union-budget-73.html?pgno=2#union-budget-2016-17">Union Budget 2016-17</a> by Finance Minister Shri Arun Jaitley.<br /><br />An assessment of the Union Budget 2016-17 has been done in the following paragraphs by the Inclusive Media for Change team, based on a number of media reports, Government documents (including the Budget documents), and reports prepared by CSOs. <br /><br /><strong>Public Finance<br /></strong><br />Although the Budget documents (please <a href="http://indiabudget.nic.in/ub2016-17/bag/bag11.pdf" title="http://indiabudget.nic.in/ub2016-17/bag/bag11.pdf">click here</a> to read) show that the budgetary estimates of tax revenue (net to centre) i.e. Rs. 9,19,842 crore was lesser than the revised estimates of Rs. 9,47,508 crore during 2015-16, in his retweet P Chidambaram (@PChidambaram_IN) has said the following: <br /><br /><br /><blockquote><p dir="ltr">The whopping increase in tax collected was due to the several times govt hiked excise duty on petrol &amp; diesel: <a href="https://twitter.com/PChidambaram_IN" title="https://twitter.com/PChidambaram_IN">@PChidambaram_IN</a></p>&mdash; INC India (@INCIndia) <a href="https://twitter.com/INCIndia/status/704264102437216256" title="https://twitter.com/INCIndia/status/704264102437216256">February 29, 2016</a></blockquote><br /><br />In the recent past, many economists had alleged that the Government did not pass the benefit of lower international crude prices to domestic consumers. <br /><br />Likewise the Economic Times (@EconomicTimes), after the Union Budget presentation, has retweeted the following message: <br /><br /><br /><blockquote><p dir="ltr">Govt boasting they collected more tax than ever. It was only due to excise on Crude. Not from Corporation or Income tax: <a href="https://twitter.com/PChidambaram_IN" title="https://twitter.com/PChidambaram_IN">@PChidambaram_IN</a></p>&mdash; EconomicTimes (@EconomicTimes) <a href="https://twitter.com/EconomicTimes/status/704264388065112065" title="https://twitter.com/EconomicTimes/status/704264388065112065">February 29, 2016</a></blockquote><br /><br />The concerns appear valid because from the Budget documents (please <a href="http://indiabudget.nic.in/ub2016-17/bag/bag2.pdf" title="http://indiabudget.nic.in/ub2016-17/bag/bag2.pdf">click here</a> to read) it could be observed that the RE of both corporation tax and income tax revenue fell below the budgetary estimates during 2015-16. However, RE was much greater than BE for tax revenue collected through Union Excise Duties in that year.<br /><br />CPI (M) General Secretary Sitaram Yechury (@SitaramYechury) has tweeted the following messages regarding Government's reliance on indirect taxes instead of direct taxes for revenue collection:<br /><br /><br /><blockquote><p dir="ltr">Increasing cess hurts the common man, with indirect tax collections proposed to be up by 20,600 cr. Direct tax proposals are down by 1060 cr</p>&mdash; Sitaram Yechury (@SitaramYechury) <a href="https://twitter.com/SitaramYechury/status/704240871164645376" title="https://twitter.com/SitaramYechury/status/704240871164645376">February 29, 2016</a></blockquote><br /><br /><blockquote><p dir="ltr">This means more burden on common people as indirect taxes are inflationary. So there will be no expansion in domestic demand.</p>&mdash; Sitaram Yechury (@SitaramYechury) <a href="https://twitter.com/SitaramYechury/status/704241179945099264" title="https://twitter.com/SitaramYechury/status/704241179945099264">February 29, 2016</a></blockquote></div><div align="justify"><br /><br />The FM in his budget speech has informed us that the fiscal deficit in RE 2015-16 and BE 2016-17 have been retained at 3.9 percent and 3.5 percent of GDP, respectively. In his opinion piece entitled: <em>Why the Budget numbers don&rsquo;t add up</em>, which was published in The Hindu dated 1 March, 2016, Dr. Rohit Azad, who teaches at JNU, has said that the fiscal deficit as a percentage of GDP has been brought down by increasing the collection of indirect taxes and excise duties, even as the non-plan expenditure went down (please <a href="https://im4change.in/latest-news-updates/why-the-budget-numbers-dont-add-up-rohit-azad-4678723.html" title="https://im4change.in/latest-news-updates/why-the-budget-numbers-dont-add-up-rohit-azad-4678723.html">click here</a> to read). <br /><br />An Analysis of the Union Budget 2016-17 by Centre for Budget and Governance Accountability (CBGA) in a report entitled <em>Connecting the Dots </em>has revealed that during 2016-17 (BE) the proportion of direct taxes and indirect taxes in the gross central taxes is estimated at 52:48, as compared to the ratio of 56:44 during 2014-15. Although indirect taxes are considered to be regressive in nature, the Central Government is increasingly getting dependent on indirect taxes.&nbsp; &nbsp;<br /></div><div align="justify">&nbsp;</div><div align="justify">The Fourteenth Finance Commission recommended to devolve 42 percent of the net proceeds of the Union tax revenues to states, against 32 percent suggested by the Thirteenth Finance Commission. However, due to the imposition of various types of cess and surcharge in the 2016-17 Union budget such as Krishi Kalyan cess, Education cess, Swachh Bharat cess, Clean Energy cess etc., states&rsquo; share in the divisible pool is likely to be 37 percent, instead of 42 percent. It is because cess / surcharges collected goes directly to the Centre, and not to the states.&nbsp; &nbsp;<br /><br />Prof. Jayati Ghosh in her Indian Express article dated 2 March, 2016 has said that during 2015-16 the share of states in the divisible pool has declined from the projected 36.3 percent of tax revenues to 34.8 percent (please <a href="http://indianexpress.com/article/opinion/columns/hype-and-reality-of-budget-2016/" title="http://indianexpress.com/article/opinion/columns/hype-and-reality-of-budget-2016/">click here</a> to read).<br /><br /><strong>Farm incomes<br /></strong><br />The BJP in its 2014 election manifesto (please <a href="http://www.bjp.org/images/pdf_2014/full_manifesto_english_07.04.2014.pdf" title="http://www.bjp.org/images/pdf_2014/full_manifesto_english_07.04.2014.pdf">click here</a> to read) had declared that if voted to power it will <em>&quot;take steps to enhance the profitability in agriculture, by ensuring a minimum of 50% profits over the cost of production, cheaper agriculture inputs and credit; introducing latest technologies for farming and high yielding seeds and linking MGNREGA&nbsp; to agriculture&quot;</em>, among other things. <br /><br />P Chidambaram has made the following tweets regarding NDA&rsquo;s promise of fair and remunerative minimum support price (MSP) of agricultural commodities: </div><div align="justify">&nbsp;</div><div align="justify"><br /><blockquote><p dir="ltr">It did worse last year by giving meagre<br />or nil increases in MSP. Budget speech makes no promise of fair &amp; remunerative MSP: <a href="https://twitter.com/PChidambaram_IN" title="https://twitter.com/PChidambaram_IN">@PChidambaram_IN</a></p>&mdash; INC India (@INCIndia) <a href="https://twitter.com/INCIndia/status/704269608841146368" title="https://twitter.com/INCIndia/status/704269608841146368">February 29, 2016</a></blockquote><br /><br /><blockquote><p dir="ltr">On Agri, I am happy that UPA schemes are being continued, but crucial signal is 'Price'. NDA reneged on its<br />promise to give cost plus 50%</p>&mdash; INC India (@INCIndia) <a href="https://twitter.com/INCIndia/status/704269264102887424" title="https://twitter.com/INCIndia/status/704269264102887424">February 29, 2016</a></blockquote><br /><br />The Communist Party of India (Marxist) (@cpimspeak) has made the following tweet regarding NDA&rsquo;s commitment to reduce farm distress:<br /><br /><blockquote><p dir="ltr"><a href="https://twitter.com/hashtag/Budget2016?src=hash" title="https://twitter.com/hashtag/Budget2016?src=hash">#Budget2016</a> Govt talks about doubling farm income by 2022 but not a single reference to thousands of farmer suicides.</p>&mdash; CPI (M) (@cpimspeak) <a href="https://twitter.com/cpimspeak/status/704219581989019648" title="https://twitter.com/cpimspeak/status/704219581989019648">February 29, 2016</a></blockquote><br /><br />In his budget speech, the FM has said that 3 specific initiatives will be taken up in 2016-17 so that the benefit of MSP reaches farmers in all parts of the country. First, the remaining states will be encouraged to take up decentralized procurement. Second, an online Procurement System will be undertaken through the Food Corporation of India so as to usher in transparency and convenience to the farmers through prior registration and monitoring of actual procurement. Third, effective arrangements have been made for pulses procurement. <br /><br />The FM in his budget speech has said that the Government is implementing the Unified Agriculture Marketing Scheme, which envisages a common e-market platform that will be deployed in selected 585 regulated wholesale markets. <br /><br />It is, however, not clear whether the policy of public procurement of foodgrains will be replaced slowly overtime by such open market online trading. The Government&rsquo;s commitment towards providing minimum support prices and remunerative prices for farmers becomes doubtful in the light of the Economic Survey 2015-16 recommending to replace the present system of MSP/ procurement based public distribution system (PDS) with direct benefit transfer (DBT) and freeing the market of all controls on domestic movement and import (please check the <em>chapter 5: Prices, Agriculture and Food Management</em>, Economic Survey 2015-16, Vol-2, please <a href="http://indiabudget.nic.in/es2015-16/echapvol2-05.pdf" title="http://indiabudget.nic.in/es2015-16/echapvol2-05.pdf">click here</a> to read). <br /><br />Although at first glance it may seem that the allocation to Department of Agriculture, Cooperation and Farmers Welfare (under the Ministry of Agriculture) has been more than doubled from Rs. 15803.04 crore (RE) in 2015-16 to Rs. 35968.79 crore (BE) in 2016-17 (as could be seen from the Expenditure Budget Volume I, please <a href="http://indiabudget.nic.in/ub2016-17/eb/stat02.pdf" title="http://indiabudget.nic.in/ub2016-17/eb/stat02.pdf">click here</a> to access), various public finance experts such as Prof. CP Chandrasekhar and Prof. Jayati Ghosh have argued that it has happened because the head 'interest subsidy for short term credit to farmers', which earlier came as part of the demand-for-grants of the Ministry of Finance, has been moved to the Ministry of Agriculture (please <a href="https://im4change.in/latest-news-updates/the-human-face-of-budget-2016-17-cp-chandrasekhar-4678726.html" title="https://im4change.in/latest-news-updates/the-human-face-of-budget-2016-17-cp-chandrasekhar-4678726.html">click here</a> to read). <br /><br />Likewise many other heads / schemes have been moved from one ministry to another, thus, creating the illusion that budgetary allocations have been increased for certain ministries or departments.<br /><br />For the Pradhan Mantri Fasal Bima Yojana (PMFBY), the budgetary allocation has been raised from Rs. 2,955 crore (RE) in 2015-16 to Rs. 5,501 crore (BE) in 2016-17. It has been alleged by farmers' organizations that the recently launched PMFBY is a dressed-up version of two existing schemes, viz. National Agricultural Insurance Scheme (NAIS) and the Modified NAIS (MNAIS). The claim that the new crop insurance scheme has reduced premium is not true since the existing NAIS, which has fairly low premiums of 1.5-3.5 percent for foodgrains and oilseeds crops and actuarial rates for horticultural and cash crops, is already running in 14 states. For a critical understanding of PMFBY, one can consult the article entitled <em>Here is why farmers' rights groups are unhappy with PM Modi's insurance scheme for them</em>, which has been written by Yogesh Pawar for DNA, dated: 17 January, 2016 (please <a href="https://im4change.in/latest-news-updates/here-is-why-farmers039-rights-groups-are-unhappy-with-pm-modi039s-insurance-scheme-for-them-yogesh-pawar-4678366.html" title="https://im4change.in/latest-news-updates/here-is-why-farmers039-rights-groups-are-unhappy-with-pm-modi039s-insurance-scheme-for-them-yogesh-pawar-4678366.html">click here</a> to read). <br /><br />Prior to the budget, the Swaraj Abhiyan criticized the PMFBY by saying that when there is crop loss, the same yield-based assessment arbitrarily decided by <em>patwaris </em>will apply (please <a href="https://im4change.in/latest-news-updates/new-insurance-scheme-has-nothing-for-farmers-swaraj-abhiyan-4678624.html" title="https://im4change.in/latest-news-updates/new-insurance-scheme-has-nothing-for-farmers-swaraj-abhiyan-4678624.html">click here</a> to read). <br /><br />Some of the tweets made by Opposition regarding the provision for farm sector under the budget, are as follows:<br /><br /><br /><blockquote><p dir="ltr">BJP forgets its own promises of fixing MSPs. Their promise that farmers will make at least 50% profit on their investment remains forgotten.</p>&mdash; INC India (@INCIndia) <a href="https://twitter.com/INCIndia/status/704362103021240321" title="https://twitter.com/INCIndia/status/704362103021240321">February 29, 2016</a></blockquote><br /><br /><blockquote><p dir="ltr">It did worse last year by giving meagre<br />or nil increases in MSP. Budget speech makes no promise of fair &amp; remunerative MSP: <a href="https://twitter.com/PChidambaram_IN" title="https://twitter.com/PChidambaram_IN">@PChidambaram_IN</a></p>&mdash; INC India (@INCIndia) <a href="https://twitter.com/INCIndia/status/704269608841146368" title="https://twitter.com/INCIndia/status/704269608841146368">February 29, 2016</a></blockquote><br /><br /><blockquote><p dir="ltr">Former Prime Minister Dr Manmohan Singh's reaction to <a href="https://twitter.com/hashtag/Budget2016?src=hash" title="https://twitter.com/hashtag/Budget2016?src=hash">#Budget2016</a> <a href="https://t.co/fhCP3ZdlOo" title="https://t.co/fhCP3ZdlOo">pic.twitter.com/fhCP3ZdlOo</a></p>&mdash; INC India (@INCIndia) <a href="https://twitter.com/INCIndia/status/704276665656946689" title="https://twitter.com/INCIndia/status/704276665656946689">February 29, 2016</a></blockquote><br /><br /><strong>MGNREGA<br /></strong><br />The FM has proposed to allocate Rs. 38,500 crore for MGNREGA during 2016-17. The budgetary estimate last year was Rs. 34,699 and the RE was Rs. 36,967 crore (please <a href="http://indiabudget.nic.in/ub2016-17/eb/sbe75.pdf" title="http://indiabudget.nic.in/ub2016-17/eb/sbe75.pdf">click here</a> to read). As compared to last year's BE, the allocation in 2016-17 has been hiked by nearly 11 percent. However, if one takes into account the inflation in Consumer Price Index (combined) between January 2016 and January 2015, which is roughly 5.7 percent (please <a href="http://mospi.nic.in/Mospi_New/upload/cpi_pr_12feb16f.pdf" title="http://mospi.nic.in/Mospi_New/upload/cpi_pr_12feb16f.pdf">click here</a> to read), then the net hike under MGNREGA is around 5.3 percent. &nbsp;<br /><br />If one takes into account the inflation in Consumer Price Index Numbers for Agricultural Labourers (1986-87= 100) between January 2016 (CPIAL: 849) and January 2015 (CPIAL: 804), which is roughly 5.6 percent, then the net hike under MGNREGA comes to 5.4 percent.<br /><br />If one takes into account the inflation in Consumer Price Index Numbers for Rural Labourers (1986-87= 100) between January 2016 (CPIRL: 854) and January 2015 (CPIRL: 808), which is roughly 5.7 percent, then the net increase under MGNREGA would be 5.3 percent.<br /><br />Therefore, a 5 percent rise in MGNREGA expenditure over the last year&rsquo;s BE (in real sense) can be termed as modest, and not something overwhelming.<br /><br />Given the backlog of payments (particularly of delayed wage payments), which is yet to be paid to 21 states, the amount allocated under the MGNREGA under this year's budget is inadequate, according to many social activists and NGOs. Many states have been requesting since October 2015-16 for the release of promised and greater funds, against the backdrop of higher demand for work in drought-hit states. <br /><br />The Central Government owes 21 states Rs. 5,595 crore as dues for work done under the MGNREGA, says Nitin Sethi in his Business Standard article entitled <em>Govt bullish on MGNREGS, but bearish on funds</em>, which was published on 25 February, 2016 (please <a href="https://im4change.in/latest-news-updates/govt-bullish-on-mgnregs-but-bearish-on-funds-nitin-sethi-4678678.html" title="https://im4change.in/latest-news-updates/govt-bullish-on-mgnregs-but-bearish-on-funds-nitin-sethi-4678678.html">click here</a> to read).&nbsp;&nbsp;&nbsp; &nbsp;<br /><br />A Scroll.in article written by Anumeha Yadav dated 29 February, 2016 says that 21 states have no funds and pending liabilities of Rs 6,359 crore (please <a href="https://im4change.in/latest-news-updates/mnrega-once-again-jaitley-wrongly-claims-highest-ever-outlay-for-039monument-to-congress-failure039-anumeha-yadav-4678733.html" title="https://im4change.in/latest-news-updates/mnrega-once-again-jaitley-wrongly-claims-highest-ever-outlay-for-039monument-to-congress-failure039-anumeha-yadav-4678733.html">click here</a> to access). &nbsp;<br /><br />Civil society activists have alleged that in the past there were attempts to kill the MGNREGA by stealth. The size of expenditure allocation under the MGNREGA in 2016-17 has been kept so low that not even 30 man-days of employment could be created on an average for a household annually. <br /><br />Regarding the MGNREGA, CPI (M) has made the following tweet:<br /><br /><br /><blockquote><p dir="ltr"><a href="https://twitter.com/hashtag/Budget2016?src=hash" title="https://twitter.com/hashtag/Budget2016?src=hash">#Budget2016</a> Its a lie to say MNREGA allocation at all time high (38000 cr). Highest in 2010-11: 39377 cr, inflation adjusted 61445 cr.</p>&mdash; CPI (M) (@cpimspeak) <a href="https://twitter.com/cpimspeak/status/704265195749658624" title="https://twitter.com/cpimspeak/status/704265195749658624">February 29, 2016</a></blockquote><br /><br /><strong>Social Sector<br /></strong><br />From the CBGA report entitled <em>Connecting the Dots: An Analysis of Union Budget 2016-17</em>, one can discern that the proposed allocation to Sarva Shiksha Abhiyan (SSA) in 2016-17 was Rs. 22,500 crore (BE) as compared to the BE of Rs. 22,000 crore in 2015-16 (please <a href="https://im4change.in/siteadmin/tinymce/uploaded/Connecting%20the%20Dots%20-%20An%20Analysis%20of%20Union%20Budget%202016-17.pdf" title="Connecting the dots CBGA" title="https://im4change.in/siteadmin/tinymce/uploaded/Connecting%20the%20Dots%20-%20An%20Analysis%20of%20Union%20Budget%202016-17.pdf" title="Connecting the dots CBGA">click here</a> to access). <br /><br />However, the Union Government spending on education as a percentage of GDP has reduced from 0.50 percent in 2015-16 (RE) to 0.48 percent in 2016-17 (BE), as per CBGA calculations. Similarly, the Union Government spending on education as a percentage of total Union budget has fallen marginally from 3.8 percent in 2015-16 (RE) to 3.7 percent in 2016-17 (BE).<br /><br />As compared to the RE of Rs. 19,122.01 crore for the National Health Mission (NHM) during 2015-16, the allocation this year has been slightly curtailed to Rs. 19,037 crore (BE).<br /><br />The CBGA budget analysis report says that for the Rashtriya Swasthya Bima Yojana (RSBY), as compared to the RE of Rs. 658.8 crore during 2015-16, the allocation this year has been more than doubled to Rs. 1743.7 crore (BE). <br /><br />Dipa Sinha in her thewire.in article entitled <em>Neglecting Health Expenditure in Favour of the Chimera of Insurance</em>, dated 29 February, 2016 has informed us that despite the failure of RSBY in reducing out-of-pocket expenditure on healthcare by the poor, the FM has gone ahead to allocate more resources under the programme. However, the Government has not augmented the allocations for National Health Mission so as to build on the gains of the National Rural Health Mission (NRHM) (please <a href="http://thewire.in/2016/02/29/neglecting-health-expenditure-in-favour-of-the-chimera-of-insurance-23133/" title="http://thewire.in/2016/02/29/neglecting-health-expenditure-in-favour-of-the-chimera-of-insurance-23133/">click here</a> to read). &nbsp;<br /><br />A meagre sum of Rs. 35 crore (BE) has been allocated for the Jan Aushadhi scheme in 2016-17, which makes little or no sense given the fact that the out-of-pocket expenditure on medicines is over 60 percent of the health expenditure of an individual during 2011-12 [as has been shown by Indrani Gupta &amp; Samik Chowdhury (2015) in a working paper, please <a href="https://im4change.in/siteadmin/tinymce/uploaded/IEG%20Working%20Paper.pdf" title="https://im4change.in/siteadmin/tinymce/uploaded/IEG%20Working%20Paper.pdf">click here</a> to read].&nbsp; &nbsp;<br />&nbsp;<br />The expenditure on food subsidy has been slashed from Rs. 1,39,419 crore (RE) in 2015-16 to Rs. 1,34,835 crore (BE) in 2016-17, as per CBGA. As a consequence, the expenditure on food subsidy as a percentage of GDP has come down from 1.03 percent in 2015-16 (BE) to 0.9 percent in 2016-17 (BE). Similarly, the expenditure on food subsidy as a percentage of total Union Government expenditure has come down from 7.81 percent in 2015-16 (BE) to 6.82 percent in 2016-17 (BE). &nbsp;<br /><br />The proposed allocation to Integrated Child Development Services (ICDS) has been reduced from Rs. 15,587 crore (RE) in 2015-16 to Rs. 14,863 crore (BE) in 2016-17. However allocation for Mid Day Meal Scheme (MDMS) has been enhanced from Rs. 9,236.4 crore (RE) in 2015-16 to Rs. 9,700 crore (BE) in 2016-17, as per the recent CBGA report.<br /><br />Regarding cutbacks in the ICDS, CPI (M) has tweeted the following:<br /><br /><br /><blockquote><p dir="ltr"><a href="https://twitter.com/hashtag/Budget2016?src=hash" title="https://twitter.com/hashtag/Budget2016?src=hash">#Budget2016</a> Integrated Child Development Services (ICDS) Allocation cut by Rs 1483 crores (~10%).</p>&mdash; CPI (M) (@cpimspeak) <a href="https://twitter.com/cpimspeak/status/704252423548702725" title="https://twitter.com/cpimspeak/status/704252423548702725">February 29, 2016</a></blockquote></div><div align="justify"><br /><br />As per the CBGA, budget for children as a percentage of total Union budget has come down from 3.62 percent in 2015-16 (RE) to 3.32 percent in 2016-17 (BE). Similarly, budget for children as a percentage of GDP has declined from 0.48 percent in 2015-16 (RE) to 0.44 percent in 2016-17 (BE).<br /><br />CBGA in its report entitled <em>Connecting the Dots: An Analysis of Union Budget 2016-17 </em>has said that during 2016-17 (BE), the total allocation for social security of unorganized workers is Rs. 12,152.7 crore, which comes to around 0.6 percent of the total Union budget outlay and 0.08 percent of the GDP. Against the previous year's allocation of Rs. 11521.9 crore, the total allocation for social security of unorganized workers has increased by 5.5 percent (i.e. Rs. 630.8 crore) in 2016-17 (BE). <br /><br />The combined allocation for Pradhan Mantri Jeevan Jyoti Bima Yojana and Pradhan Mantri Suraksha Bima Yojana is Rs. 50 crore, says the CBGA report.<br />&nbsp;<br />The Aam Aadmi Bima Yojana, a life insurance scheme that also includes rural landless labourers as beneficiaries, has been allocated Rs. 450 crore. Since 56 percent of total rural households (10.08 crore out of 17.9 crore households) in the country do not own any land, the allocation could have been enhanced, says the CBGA report.<br /><br /><strong>Conclusion<br /></strong><br />Although the Union Budget 2016-17 has been appreciated by mainstream economists for following the agenda of fiscal consolidation so as to promote macroeconomic stability, for the exact same reason the budget has been labelled as neoliberal in nature by Left-oriented economists. The latter group of economists has opined that fiscal discipline in the face of recession could further contract national output, and hence affect tax collection. It is the social sector that has suffered the most due to the policy of fiscal prudence pursued in the recent years. &nbsp;<br /><br /><br /><strong>References:<br /></strong><br />CPIAL and CPIRL, Labour Bureau, please <a href="http://labourbureau.nic.in/indnum.htm" title="http://labourbureau.nic.in/indnum.htm">click here</a> to access&nbsp;<br /><br />Press Note: CPIAL and CPIRL, Labour Bureau, please <a href="http://labourbureau.nic.in/pressAL.html" title="http://labourbureau.nic.in/pressAL.html">click here</a> to access<br />&nbsp;<br />The Poor Badly Needed a Good Budget this Year. Well, They Didn&rsquo;t Get It. -Bharat Dogra, TheWire.in, 29 February, 2016, please <a href="https://im4change.in/latest-news-updates/the-poor-badly-needed-a-good-budget-this-year-well-they-didnt-get-it-bharat-dogra-4678716.html" title="https://im4change.in/latest-news-updates/the-poor-badly-needed-a-good-budget-this-year-well-they-didnt-get-it-bharat-dogra-4678716.html">click here</a> to access <br /><br />Budget expectations for rural sector, please <a href="https://im4change.in/news-alerts/budget-expectations-for-rural-sector-4678693.html" title="https://im4change.in/news-alerts/budget-expectations-for-rural-sector-4678693.html">click here</a> to access<br /><br />14th Finance Commission (FFC) Report tabled in Parliament, Press Information Bureau, Government of India, Ministry of Finance, 24 February, 2015, please <a href="http://pib.nic.in/newsite/PrintRelease.aspx?relid=115810" title="http://pib.nic.in/newsite/PrintRelease.aspx?relid=115810">click here</a> to access <br /><br />Note on Demands for Grants for Department of Agriculture, Cooperation and Farmers' Welfare (2016-17), Ministry of Agriculture, please <a href="http://indiabudget.nic.in/ub2016-17/eb/sbe1.pdf" title="http://indiabudget.nic.in/ub2016-17/eb/sbe1.pdf">click here</a> to access <br /><br />Note on Demands for Grants for Department of Financial Services (2015-16), Ministry of Finance, please <a href="http://indiabudget.nic.in/budget2015-2016/ub2015-16/eb/sbe35.pdf" title="http://indiabudget.nic.in/budget2015-2016/ub2015-16/eb/sbe35.pdf">click here</a> to access <br /><br />UPA&rsquo;s flagship MGNREGA receives a fresh lease of life -Harish Damodaran, The Indian Express, 1 March, 2016, please <a href="https://im4change.in/latest-news-updates/upas-flagship-mgnrega-receives-a-fresh-lease-of-life-harish-damodaran-4678730.html" title="https://im4change.in/latest-news-updates/upas-flagship-mgnrega-receives-a-fresh-lease-of-life-harish-damodaran-4678730.html">click here</a> to access <br /><br />Pretending to be pro-poor, little change over UPA -Arun Kumar, The Tribune, 1 March, 2016, please <a href="https://im4change.in/latest-news-updates/pretending-to-be-pro-poor-little-change-over-upa-arun-kumar-4678728.html" title="https://im4change.in/latest-news-updates/pretending-to-be-pro-poor-little-change-over-upa-arun-kumar-4678728.html">click here</a> to access <br /><br />The Union Budget&rsquo;s political message -Smita Gupta, The Hindu, 1 March, 2016, please <a href="https://im4change.in/latest-news-updates/the-union-budgets-political-message-smita-gupta-4678724.html" title="https://im4change.in/latest-news-updates/the-union-budgets-political-message-smita-gupta-4678724.html">click here</a> to access <br /><br />No Gamechangers For Farmers -Ashok Gulati, The Indian Express, 1 March, 2016, please <a href="https://im4change.in/latest-news-updates/no-gamechangers-for-farmers-ashok-gulati-4678722.html" title="https://im4change.in/latest-news-updates/no-gamechangers-for-farmers-ashok-gulati-4678722.html">click here</a> to access <br /><br />Applause and the fine print -Devadeep Purohit, The Telegraph, 1 March, 2016, please <a href="https://im4change.in/latest-news-updates/applause-and-the-fine-print-devadeep-purohit-4678721.html" title="https://im4change.in/latest-news-updates/applause-and-the-fine-print-devadeep-purohit-4678721.html">click here</a> to access <br /><br />By no means a &lsquo;socialist&rsquo; Budget -G Sampath, The Hindu, 1 March, 2016, please <a href="https://im4change.in/latest-news-updates/by-no-means-a-socialist-budget-g-sampath-4678720.html" title="https://im4change.in/latest-news-updates/by-no-means-a-socialist-budget-g-sampath-4678720.html">click here</a> to access <br /><br />Just another trivial Budget -Ashok V Desai, The Hindu, 1 March, 2016, please <a href="https://im4change.in/latest-news-updates/just-another-trivial-budget-ashok-v-desai-4678718.html" title="https://im4change.in/latest-news-updates/just-another-trivial-budget-ashok-v-desai-4678718.html">click here</a> to read&nbsp; <br /><br />Government tries to harvest success with farmer-friendly Budget -Richard Mahapatra, Down to Earth, 29 February, 2016, please <a href="https://im4change.in/latest-news-updates/government-tries-to-harvest-success-with-farmer-friendly-budget-richard-mahapatra-4678719.html" title="https://im4change.in/latest-news-updates/government-tries-to-harvest-success-with-farmer-friendly-budget-richard-mahapatra-4678719.html">click here</a> to read more <br /><br />'Too little' tag on rural job scheme raise, The Telegraph, 29 February, 2016, please <a href="https://im4change.in/latest-news-updates/039too-little039-tag-on-rural-job-scheme-raise-4678732.html" title="https://im4change.in/latest-news-updates/039too-little039-tag-on-rural-job-scheme-raise-4678732.html">click here</a> to access <br /></div><div align="justify">&nbsp;</div><div align="justify"><strong>Image Courtesy: MKSS</strong> <br /></div>                                                           
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Home हिन्दी

Union Budget 2016-17: Mere eyewash or some concrete steps

Published on Mar 2, 2016   Modified on May 6, 2016

In the age of social media, various sections of the Indian polity and civil society have reacted publicly in diverse voices, following the presentation of the Union Budget 2016-17 by Finance Minister Shri Arun Jaitley. An assessment of the Union Budget 2016-17 has been done in the following paragraphs by the Inclusive Media for Change team, based on a number of media reports, Government documents (including the Budget documents), and reports prepared by CSOs. Public Finance Although the Budget documents (please click here to read) show that the budgetary estimates of tax revenue (net to centre) i.e. Rs. 9,19,842 crore was lesser than the revised estimates of Rs. 9,47,508 crore during 2015-16, in his retweet P Chidambaram (@PChidambaram_IN) has said the following: The whopping increase in tax collected was due to the several times govt hiked excise duty on petrol & diesel: @PChidambaram_IN — INC India (@INCIndia) February 29, 2016 In the recent past, many economists had alleged that the Government did not pass the benefit of lower international crude prices to domestic consumers. Likewise the Economic Times (@EconomicTimes), after the Union Budget presentation, has retweeted the following message: Govt boasting they collected more tax than ever. It was only due to excise on Crude. Not from Corporation or Income tax: @PChidambaram_IN — EconomicTimes (@EconomicTimes) February 29, 2016 The concerns appear valid because from the Budget documents (please click here to read) it could be observed that the RE of both corporation tax and income tax revenue fell below the budgetary estimates during 2015-16. However, RE was much greater than BE for tax revenue collected through Union Excise Duties in that year. CPI (M) General Secretary Sitaram Yechury (@SitaramYechury) has tweeted the following messages regarding Government's reliance on indirect taxes instead of direct taxes for revenue collection: Increasing cess hurts the common man, with indirect tax collections proposed to be up by 20,600 cr. Direct tax proposals are down by 1060 cr — Sitaram Yechury (@SitaramYechury) February 29, 2016 This means more burden on common people as indirect taxes are inflationary. So there will be no expansion in domestic demand. — Sitaram Yechury (@SitaramYechury) February 29, 2016 The FM in his budget speech has informed us that the fiscal deficit in RE 2015-16 and BE 2016-17 have been retained at 3.9 percent and 3.5 percent of GDP, respectively. In his opinion piece entitled: Why the Budget numbers don’t add up, which was published in The Hindu dated 1 March, 2016, Dr. Rohit Azad, who teaches at JNU, has said that the fiscal deficit as a percentage of GDP has been brought down by increasing the collection of indirect taxes and excise duties, even as the non-plan expenditure went down (please click here to read). An Analysis of the Union Budget 2016-17 by Centre for Budget and Governance Accountability (CBGA) in a report entitled Connecting the Dots has revealed that during 2016-17 (BE) the proportion of direct taxes and indirect taxes in the gross central taxes is estimated at 52:48, as compared to the ratio of 56:44 during 2014-15. Although indirect taxes are considered to be regressive in nature, the Central Government is increasingly getting dependent on indirect taxes.      The Fourteenth Finance Commission recommended to devolve 42 percent of the net proceeds of the Union tax revenues to states, against 32 percent suggested by the Thirteenth Finance Commission. However, due to the imposition of various types of cess and surcharge in the 2016-17 Union budget such as Krishi Kalyan cess, Education cess, Swachh Bharat cess, Clean Energy cess etc., states’ share in the divisible pool is likely to be 37 percent, instead of 42 percent. It is because cess / surcharges collected goes directly to the Centre, and not to the states.    Prof. Jayati Ghosh in her Indian Express article dated 2 March, 2016 has said that during 2015-16 the share of states in the divisible pool has declined from the projected 36.3 percent of tax revenues to 34.8 percent (please click here to read). Farm incomes The BJP in its 2014 election manifesto (please click here to read) had declared that if voted to power it will "take steps to enhance the profitability in agriculture, by ensuring a minimum of 50% profits over the cost of production, cheaper agriculture inputs and credit; introducing latest technologies for farming and high yielding seeds and linking MGNREGA  to agriculture", among other things. P Chidambaram has made the following tweets regarding NDA’s promise of fair and remunerative minimum support price (MSP) of agricultural commodities:   It did worse last year by giving meagre or nil increases in MSP. Budget speech makes no promise of fair & remunerative MSP: @PChidambaram_IN — INC India (@INCIndia) February 29, 2016 On Agri, I am happy that UPA schemes are being continued, but crucial signal is 'Price'. NDA reneged on its promise to give cost plus 50% — INC India (@INCIndia) February 29, 2016 The Communist Party of India (Marxist) (@cpimspeak) has made the following tweet regarding NDA’s commitment to reduce farm distress: #Budget2016 Govt talks about doubling farm income by 2022 but not a single reference to thousands of farmer suicides. — CPI (M) (@cpimspeak) February 29, 2016 In his budget speech, the FM has said that 3 specific initiatives will be taken up in 2016-17 so that the benefit of MSP reaches farmers in all parts of the country. First, the remaining states will be encouraged to take up decentralized procurement. Second, an online Procurement System will be undertaken through the Food Corporation of India so as to usher in transparency and convenience to the farmers through prior registration and monitoring of actual procurement. Third, effective arrangements have been made for pulses procurement. The FM in his budget speech has said that the Government is implementing the Unified Agriculture Marketing Scheme, which envisages a common e-market platform that will be deployed in selected 585 regulated wholesale markets. It is, however, not clear whether the policy of public procurement of foodgrains will be replaced slowly overtime by such open market online trading. The Government’s commitment towards providing minimum support prices and remunerative prices for farmers becomes doubtful in the light of the Economic Survey 2015-16 recommending to replace the present system of MSP/ procurement based public distribution system (PDS) with direct benefit transfer (DBT) and freeing the market of all controls on domestic movement and import (please check the chapter 5: Prices, Agriculture and Food Management, Economic Survey 2015-16, Vol-2, please click here to read). Although at first glance it may seem that the allocation to Department of Agriculture, Cooperation and Farmers Welfare (under the Ministry of Agriculture) has been more than doubled from Rs. 15803.04 crore (RE) in 2015-16 to Rs. 35968.79 crore (BE) in 2016-17 (as could be seen from the Expenditure Budget Volume I, please click here to access), various public finance experts such as Prof. CP Chandrasekhar and Prof. Jayati Ghosh have argued that it has happened because the head 'interest subsidy for short term credit to farmers', which earlier came as part of the demand-for-grants of the Ministry of Finance, has been moved to the Ministry of Agriculture (please click here to read). Likewise many other heads / schemes have been moved from one ministry to another, thus, creating the illusion that budgetary allocations have been increased for certain ministries or departments. For the Pradhan Mantri Fasal Bima Yojana (PMFBY), the budgetary allocation has been raised from Rs. 2,955 crore (RE) in 2015-16 to Rs. 5,501 crore (BE) in 2016-17. It has been alleged by farmers' organizations that the recently launched PMFBY is a dressed-up version of two existing schemes, viz. National Agricultural Insurance Scheme (NAIS) and the Modified NAIS (MNAIS). The claim that the new crop insurance scheme has reduced premium is not true since the existing NAIS, which has fairly low premiums of 1.5-3.5 percent for foodgrains and oilseeds crops and actuarial rates for horticultural and cash crops, is already running in 14 states. For a critical understanding of PMFBY, one can consult the article entitled Here is why farmers' rights groups are unhappy with PM Modi's insurance scheme for them, which has been written by Yogesh Pawar for DNA, dated: 17 January, 2016 (please click here to read). Prior to the budget, the Swaraj Abhiyan criticized the PMFBY by saying that when there is crop loss, the same yield-based assessment arbitrarily decided by patwaris will apply (please click here to read). Some of the tweets made by Opposition regarding the provision for farm sector under the budget, are as follows: BJP forgets its own promises of fixing MSPs. Their promise that farmers will make at least 50% profit on their investment remains forgotten. — INC India (@INCIndia) February 29, 2016 It did worse last year by giving meagre or nil increases in MSP. Budget speech makes no promise of fair & remunerative MSP: @PChidambaram_IN — INC India (@INCIndia) February 29, 2016 Former Prime Minister Dr Manmohan Singh's reaction to #Budget2016 pic.twitter.com/fhCP3ZdlOo — INC India (@INCIndia) February 29, 2016 MGNREGA The FM has proposed to allocate Rs. 38,500 crore for MGNREGA during 2016-17. The budgetary estimate last year was Rs. 34,699 and the RE was Rs. 36,967 crore (please click here to read). As compared to last year's BE, the allocation in 2016-17 has been hiked by nearly 11 percent. However, if one takes into account the inflation in Consumer Price Index (combined) between January 2016 and January 2015, which is roughly 5.7 percent (please click here to read), then the net hike under MGNREGA is around 5.3 percent.   If one takes into account the inflation in Consumer Price Index Numbers for Agricultural Labourers (1986-87= 100) between January 2016 (CPIAL: 849) and January 2015 (CPIAL: 804), which is roughly 5.6 percent, then the net hike under MGNREGA comes to 5.4 percent. If one takes into account the inflation in Consumer Price Index Numbers for Rural Labourers (1986-87= 100) between January 2016 (CPIRL: 854) and January 2015 (CPIRL: 808), which is roughly 5.7 percent, then the net increase under MGNREGA would be 5.3 percent. Therefore, a 5 percent rise in MGNREGA expenditure over the last year’s BE (in real sense) can be termed as modest, and not something overwhelming. Given the backlog of payments (particularly of delayed wage payments), which is yet to be paid to 21 states, the amount allocated under the MGNREGA under this year's budget is inadequate, according to many social activists and NGOs. Many states have been requesting since October 2015-16 for the release of promised and greater funds, against the backdrop of higher demand for work in drought-hit states. The Central Government owes 21 states Rs. 5,595 crore as dues for work done under the MGNREGA, says Nitin Sethi in his Business Standard article entitled Govt bullish on MGNREGS, but bearish on funds, which was published on 25 February, 2016 (please click here to read).      A Scroll.in article written by Anumeha Yadav dated 29 February, 2016 says that 21 states have no funds and pending liabilities of Rs 6,359 crore (please click here to access).   Civil society activists have alleged that in the past there were attempts to kill the MGNREGA by stealth. The size of expenditure allocation under the MGNREGA in 2016-17 has been kept so low that not even 30 man-days of employment could be created on an average for a household annually. Regarding the MGNREGA, CPI (M) has made the following tweet: #Budget2016 Its a lie to say MNREGA allocation at all time high (38000 cr). Highest in 2010-11: 39377 cr, inflation adjusted 61445 cr. — CPI (M) (@cpimspeak) February 29, 2016 Social Sector From the CBGA report entitled Connecting the Dots: An Analysis of Union Budget 2016-17, one can discern that the proposed allocation to Sarva Shiksha Abhiyan (SSA) in 2016-17 was Rs. 22,500 crore (BE) as compared to the BE of Rs. 22,000 crore in 2015-16 (please click here to access). However, the Union Government spending on education as a percentage of GDP has reduced from 0.50 percent in 2015-16 (RE) to 0.48 percent in 2016-17 (BE), as per CBGA calculations. Similarly, the Union Government spending on education as a percentage of total Union budget has fallen marginally from 3.8 percent in 2015-16 (RE) to 3.7 percent in 2016-17 (BE). As compared to the RE of Rs. 19,122.01 crore for the National Health Mission (NHM) during 2015-16, the allocation this year has been slightly curtailed to Rs. 19,037 crore (BE). The CBGA budget analysis report says that for the Rashtriya Swasthya Bima Yojana (RSBY), as compared to the RE of Rs. 658.8 crore during 2015-16, the allocation this year has been more than doubled to Rs. 1743.7 crore (BE). Dipa Sinha in her thewire.in article entitled Neglecting Health Expenditure in Favour of the Chimera of Insurance, dated 29 February, 2016 has informed us that despite the failure of RSBY in reducing out-of-pocket expenditure on healthcare by the poor, the FM has gone ahead to allocate more resources under the programme. However, the Government has not augmented the allocations for National Health Mission so as to build on the gains of the National Rural Health Mission (NRHM) (please click here to read).   A meagre sum of Rs. 35 crore (BE) has been allocated for the Jan Aushadhi scheme in 2016-17, which makes little or no sense given the fact that the out-of-pocket expenditure on medicines is over 60 percent of the health expenditure of an individual during 2011-12 [as has been shown by Indrani Gupta & Samik Chowdhury (2015) in a working paper, please click here to read].      The expenditure on food subsidy has been slashed from Rs. 1,39,419 crore (RE) in 2015-16 to Rs. 1,34,835 crore (BE) in 2016-17, as per CBGA. As a consequence, the expenditure on food subsidy as a percentage of GDP has come down from 1.03 percent in 2015-16 (BE) to 0.9 percent in 2016-17 (BE). Similarly, the expenditure on food subsidy as a percentage of total Union Government expenditure has come down from 7.81 percent in 2015-16 (BE) to 6.82 percent in 2016-17 (BE).   The proposed allocation to Integrated Child Development Services (ICDS) has been reduced from Rs. 15,587 crore (RE) in 2015-16 to Rs. 14,863 crore (BE) in 2016-17. However allocation for Mid Day Meal Scheme (MDMS) has been enhanced from Rs. 9,236.4 crore (RE) in 2015-16 to Rs. 9,700 crore (BE) in 2016-17, as per the recent CBGA report. Regarding cutbacks in the ICDS, CPI (M) has tweeted the following: #Budget2016 Integrated Child Development Services (ICDS) Allocation cut by Rs 1483 crores (~10%). — CPI (M) (@cpimspeak) February 29, 2016 As per the CBGA, budget for children as a percentage of total Union budget has come down from 3.62 percent in 2015-16 (RE) to 3.32 percent in 2016-17 (BE). Similarly, budget for children as a percentage of GDP has declined from 0.48 percent in 2015-16 (RE) to 0.44 percent in 2016-17 (BE). CBGA in its report entitled Connecting the Dots: An Analysis of Union Budget 2016-17 has said that during 2016-17 (BE), the total allocation for social security of unorganized workers is Rs. 12,152.7 crore, which comes to around 0.6 percent of the total Union budget outlay and 0.08 percent of the GDP. Against the previous year's allocation of Rs. 11521.9 crore, the total allocation for social security of unorganized workers has increased by 5.5 percent (i.e. Rs. 630.8 crore) in 2016-17 (BE). The combined allocation for Pradhan Mantri Jeevan Jyoti Bima Yojana and Pradhan Mantri Suraksha Bima Yojana is Rs. 50 crore, says the CBGA report.   The Aam Aadmi Bima Yojana, a life insurance scheme that also includes rural landless labourers as beneficiaries, has been allocated Rs. 450 crore. Since 56 percent of total rural households (10.08 crore out of 17.9 crore households) in the country do not own any land, the allocation could have been enhanced, says the CBGA report. Conclusion Although the Union Budget 2016-17 has been appreciated by mainstream economists for following the agenda of fiscal consolidation so as to promote macroeconomic stability, for the exact same reason the budget has been labelled as neoliberal in nature by Left-oriented economists. The latter group of economists has opined that fiscal discipline in the face of recession could further contract national output, and hence affect tax collection. It is the social sector that has suffered the most due to the policy of fiscal prudence pursued in the recent years.   References: CPIAL and CPIRL, Labour Bureau, please click here to access  Press Note: CPIAL and CPIRL, Labour Bureau, please click here to access   The Poor Badly Needed a Good Budget this Year. Well, They Didn’t Get It. -Bharat Dogra, TheWire.in, 29 February, 2016, please click here to access Budget expectations for rural sector, please click here to access 14th Finance Commission (FFC) Report tabled in Parliament, Press Information Bureau, Government of India, Ministry of Finance, 24 February, 2015, please click here to access Note on Demands for Grants for Department of Agriculture, Cooperation and Farmers' Welfare (2016-17), Ministry of Agriculture, please click here to access Note on Demands for Grants for Department of Financial Services (2015-16), Ministry of Finance, please click here to access UPA’s flagship MGNREGA receives a fresh lease of life -Harish Damodaran, The Indian Express, 1 March, 2016, please click here to access Pretending to be pro-poor, little change over UPA -Arun Kumar, The Tribune, 1 March, 2016, please click here to access The Union Budget’s political message -Smita Gupta, The Hindu, 1 March, 2016, please click here to access No Gamechangers For Farmers -Ashok Gulati, The Indian Express, 1 March, 2016, please click here to access Applause and the fine print -Devadeep Purohit, The Telegraph, 1 March, 2016, please click here to access By no means a ‘socialist’ Budget -G Sampath, The Hindu, 1 March, 2016, please click here to access Just another trivial Budget -Ashok V Desai, The Hindu, 1 March, 2016, please click here to read  Government tries to harvest success with farmer-friendly Budget -Richard Mahapatra, Down to Earth, 29 February, 2016, please click here to read more 'Too little' tag on rural job scheme raise, The Telegraph, 29 February, 2016, please click here to access   Image Courtesy: MKSS

Tagged with: centre for budget and governance accountability cbga Integrated Child Development Services Mid Day Meal Scheme Pradhan Mantri Fasal Bima Yojana minimum support price Minimum Support Prices Economic Survey 2015-16 14th Finance Commission Direct Taxes Indirect Taxes Interest Subvention Scheme Delayed Payment mgnrega NREGA NREGS Employment Farmers farming Agriculture Food Security ICDS MDMS Union Budget Union Budget 2016-17 Food Subsidy National Health Mission Tax Revenue Crop Insurance

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