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Sunday 22 October 2017
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Congress rejects Dhumal claims of fiscal health of the state

Cabinet ministers has rejected the claims of former Chief Minister Prem Kumar Dhumal that the Congress has caused fiscal mess in the State and termed that false, politically motivated and factually incorrect.

Thakur Singh Bharmouri, Forest Minister, Mukesh Agnihotri, Industries Minister, Sudhir Sharma, Urban Development Minister and, Anil Sharma, Rural Development and Panchayati Raj Minister, in their joint statement accused the BJP led government for creating financial mess in the State.

Ministers claimed that the BJP Government had failed to present the State’s case before the Thirteenth Finance Commission properly and in a befitting manner that resulted in under-estimation of committed liabilities of the State by the Thirteenth Finance Commission. They claimed

The Thirteenth Finance Commission has not even given an equal treatment to the State despite the fact that preferential treatment to a Special Category State like Himachal Pradesh was required to be given by the Thirteenth Finance Commission. While the Commission recommended an average increase of 126% in total devolution to other States compared to 12th Finance Commission award, the increase in case of Himachal Pradesh was only 50%, which was the lowest in the country. This clearly establishes the failure of the then BJP Government to properly place the rightful claim of the State before the Finance Commission. Had Himachal got an equal treatment comparable with overall increase of 126% for the country as a whole, it would have received an additional fund transfer of Rs 10,725 Crore over a period of five years between 2010 and 2015. Therefore, there has been a net loss of Rs. 10,725 crores because of the unfair award given to Himachal Pradesh for which former chief Minister Sh. Prem Kumar Dhumal was himself responsible. The situation has become alarmingly grim during the last two years of the award period of the Thirteenth Finance Commission as the Non-Plan Revenue Deficit Grants during the financial year 2013-14 has declined to Rs. 1,313 Crore from Rs. 1,883 Crore in 2012-13 and will further reduce to Rs. 406 crore in the financial year 2014-15.

Congress leaders also slammed previous Dhumal led Govt’s decision of allowing pay revision based on Punjab Government’s decision without any recommendations of the Punjab Pay Commission. They stated that it was done to woo electorates in the poll year and that created huge committed liabilities which the present Government has to bear. The present Congress Government had to manage this huge financial liability which was created on account of this decision, Congress leader further claimed.

Cabinet Ministers also ridiculed the statement with regard to loan liabilities created during BJP regime from 2007 – 2012 and those created during the Congress regime i.e. from 2002 -2007 and termed them misleading. Congress leaders claimed

As on March 2008, HP Government had a loan liability of Rs. 21241 crore which has increased to Rs. 28707 crore on March, 2013. Thus loan liability has increased by Rs. 7466 crore between the period from March, 2008 to March, 2013. In fact, loan amounting to Rs.1838 crore was converted into guarantee in the year 2009-10. Thus, the actual loan taken between the period March, 2008 to March, 2013 was Rs. 9304 crore whereas the loan liability increased only by Rs. 8032 crore during the period April 2003 to March 2008.

Cabinet Ministers also accused Leader of Opposition for distorting the facts regarding the plan outlays and the expenditure. The Plan expenditure figures need to be viewed in the context of the year on the prices of which the figures have been quoted. The Plan outlays of Rs.5700 crore for the 9th Five Year Plan were finalized in the year 1996-97 at current prices i.e. at the prices that prevailed in the year 1996-97. The expenditure figure of Rs.7899.67 crore (the figure is arrived at by adding Plan expenditure against the outlays of five years of the 9th Five Year Plan at current prices) against these outlays if are deflated to the prices that prevailed in 1996-97 would be much less than the approved outlays for the 9th Five Year Plan.

They stated that the increase from Rs.5700 crore for the 10th Five Year Plan to Rs.10300 crore for the 11th Five Year Plan also needs to be seen in the perspective of the inflation rate that prevailed during that period. If the figure of Rs.10300 crore is deflated to the prices of the first year of the 10th Five Year Plan by the inflation index, the increase in two subsequent Five Year Plans would be nominal, Congress leader further added.

During the 10th Five Year Plan period i.e. 2002-2007, the annual inflation rate hovered 4 to 5%. Considering this, an increase of 33.76% in the 11th Five Year Plan over 10th Five Year Plan was reasonable. However, during the period 2007 to 2012 i.e. of the 11th Five Year Plan the annual inflation rate largely remained in double figures. Hence, viewing the difference in the Plan outlays of the 11th Five Year Plan and the 12th Five Year Plan without discounting for the double digit inflation rate that prevailed during the 11th Five Year Plan period may not be very meaningful.



Rahul Bhandari is Editor of TheNewsHimachal and has been part of the digital world for last eight years.