Fiscal deficit under control, Assembly told ahead of Budget presentation
SHILLONG: Chief Minister Mukul Sangma has claimed that the State Government has been successful in keeping its fiscal deficit below 3 per cent for the past three years.
According to Sangma, the fiscal deficit was fixed at 2.08 percent during 2013-2014, 1.74 percent during 2014-2015 and the fiscal deficit of the State is projected at 2.08 percent as per Budget estimates for 2015-2016.
“The fiscal discipline (deficit below 3 per cent) is mainlined in conformity with the FRBM Act (Fiscal Responsibility and Budget Management Act,” the Chief Minister said while taking part in Question Hour in Assembly on Friday.
Stating that the State was going through a severe financial crunch due to NGT ban on coal mining, Sangma said Meghalaya always depended on the royalty and relevant taxes earned from coal mining and various other economic activities that are directly or indirectly link with coal mining.
“The NGT ban has definitely affected execution of various developmental programmes of the Government,” he said.
The Chief Minister said that the State Government has adopted several measures to bridge the gap including imposition of 20 per cent cut in the non-Plan expenditures.
He said that the department can submit proposals for exemption of the 20 percent cut on the committed liabilities.
“The measures have to be placed before the cabinet for its approval. The details will be made known in the budget to be brought before the House,” Sangma said.
The Chief Minister was replying to a query raised by UDP legislator Paul Lyngdoh on the fiscal health of the state after the NGT ban on mining and transportation of coal, which was the main source of revenue for the state.
Despite the cut on the non-plan expenditure, the Chief Minister said that the State Government had taken up various developmental initiatives especially development of new roads, improvement and upgradation of the existing State highways and district roads from the Plan money.
Lyngdoh also sought to know as to how the state government was going to match the huge gap between the projected Rs 52,000 crore expenditure and Rs 1,700 crore awarded by the 14th Finance Commission, which he said was the “lowest among the NE states”.
In reply, the Chief Minister said that the reason for the lower allocation is because the economy of the State is much better in comparison with the other Northeastern states.
Later, replying to the debate on Governor’s address, Sangma said that there would be more visibility of Government programmes in 2015-16.
Sangma justified less allocation from the 14th Finance Commission for Meghalaya by stating that more funds were allotted to those states whose fiscal position was alarming.
“If the award is high for states it means that state is in financial mess,” Sangma said.