STATE TIMES NEWS
JAMMU: The Jammu and Kashmir Government on Wednesday presented Rs 79,472 crore deficit budget laying emphasis on pro-employees welfare initiatives, including the implementation of 7th Pay Commission from April next year.
State Finance Minister Haseeb Drabu in his Budget speech in the Assembly said the focus will be on timely rollout of projects under PMDP to the tune of Rs 80,000 crore for development and reconstruction of physical and economic infrastructure.
Various initiatives were also announced including insurance to government properties, crops, heritage properties and various types of financial aid for workforce in different sectors.
“During 2017-18, the state government intends to spend almost Rs 79,472 crore. Of this, developmental expenditure would be about Rs 31,000 crore and current expenditure would be almost Rs 49,000 crore,” Drabu said.
“This level of expenditure will be financed through non debt creating receipts of Rs 58,000 crore and about Rs 18,000 crore of borrowings,” he said.
“Given the composition of our revenues, we have a surplus of more than Rs 9,300 crore. Yet, here will be a resource gap of Rs 3,137 crore for which ways and means have to be found during the course of the year,” he said.
While the total receipts are to the tune of Rs 76,335 crore, the total expenditure is to the tune of Rs 79,472 crore resulting in deficit of Rs 3,135 crore, he said.
He said in the new scheme of federal finance, centrally sponsored schemes account for a major part of the capital expenditure budget.
“Significant resources are also committed towards meeting the required state share for accessing central funds under the CSS and for putting in counterpart share for World Bank/ADB funded projects and now the Prime Minister’s Development Package (PMDP),” he said.
The package caters to the need to strengthen the economic and social infrastructure and provide for balanced development of the three regions of Jammu and Kashmir, he added.
“The major focus in the infrastructure sector will be on physical connectivity through upgradation of road network. All unconnected roads and hamlets will be covered through different projects,” he added.
Given the prevailing situation, both receipts as well as expenditure have had to be revised downwards, he said adding that the total revenue receipts of the state for the current financial year are revised to Rs 57,522 crore, lower than the budgeted estimates by Rs 4,159 crore.
This shortfall is mainly on account of lower collection of state’s own tax revenue and a reduced level of borrowings.
Tax revenue is expected to register a shortfall of Rs 778 crore.
He said the non tax revenue shows an increase of about Rs 1,200 crore because the Revenue Expenditure (RE) includes contra credit of Rs 1,400 crore on account of power subsidy and otherwise, non tax revenues have done equally badly.
“Likewise, RE is about Rs 2,400 crore less than what we had budgeted for and Capital Expenditure is more or less at the budgeted level. As a result, the resource gap has increased by about Rs 1,000 crore,” he said.
“Indeed, in the course of this year we have cleared liabilities of Rs 5,000 crore and hope to clear Rs 3,000 crore more,” he added.
The minister said the 7th Pay Commission for government employees will be implemented in cash from April 1, 2018.
“Insurance cover be provided to serving employees of all categories in government for a period of five years. Further, it be made optional for pensioners up to a cover of Rs 6 lakh for full family unit,” he said.
“The principle focus of this budget is to build system processes so that we can spend this money efficiently, usefully for the entire state and showcase a certain degree of progress and that is the key theme of the budget,” he told reporters here.
Taking the state towards modern public management system, he said, “Drawing from the International Monetary Fund’s classification reforms spelt out in its Government Finance Statistics Manual, I intend to give the budget structure a developmental rather than a purely administrative orientation.”
He said he proposed to reorganise the 29 departmental demands for grants into four major sectoral categories: Administrative, Infrastructure Development, Social Sector and Economic Development.
“Changing the format of budget documentation and reporting is an important aspect of the budget reform process and of implementing a new framework for public financial management. I want to give it a legislative backing,” he said.
The new legislative framework for public financial management will shift the onus of managing the use of resources from central control to the managers of spending departments and agencies, he said.
“We will put in place Budget Estimation, Allocation and Monitoring System (BEAMS), online computerized system to distribute the budget and to authorize expenditure,” he said adding that Treasury System be replaced by a functionally aligned Pay and Accounts Office (PAO) System.
“Budget control mechanism of audit and invoice checking will be strengthened at the department level,” he said adding that Integrated Financial Management System (IFMS) will also come into force for online bill processing.
In bid to use working season more, the minister said the Finance Department and the Planning, Development and Monitoring Department will release 50 per cent of the revenue and Capex budget by February 10, authorising expenditure to be made from April 1.
“The administrative departments/HODs/executing agencies should complete procurement and tendering process by May,” he said.
Tax Proposals
4Extension of tax incentives for 2017-18.
4Incandescent bulbs to be placed in negative list.
4To make major check posts cashless.
4The J&K Passenger Tax Act 1963 shall be
administered by the Transport Department.
4Increase advertisement tariffs.
Note ban did not have much affect: Drabu
Jammu: Stating that main banks in the state managed demonetisation well, the Jammu and Kashmir government on Wednesday said the note ban did not have any negative effect on the state and instead it helped bring down prices of the real estate which had once gone beyond reach.
“I don’t think that the demonetisation has had any effect as it has been managed very well by the principle banks and I would complement J&K Bank for that,” Finance Minister Haseeb Drabu told reporters after presenting the state budget on Wednesday.
He said that the people of J&K have got used to certain situation of distress and when the strike is for five months and banks are not open so they stock cash, when there is uncertainty in the overall system then people take measures to keep cash so the transactional demand is very high. “Also there is a lot of community banking in J&K and the number of people are very small 1.25 crore people, it is not like Bihar and UP and I think we have managed the demonetisation part very well as far as personal finance go.”
“I think the principle impact of demonetisation on the economy of J&K has been to soften the land rates. I think that is a big thing as you would find that there was an asset price bubble in the system where your assets like the house and land was way out of line with the other assets I think that has soften that and I think that is a good thing that has happened , he said.
He said that the one single point in this budget is how to improve the efficiency of spending, how can be spend well.
“Every year we spend thousands of crores like this year we are spending around Rs 75,000 crores. Does it get reflected on the ground and if does not then why does not it because there is inefficiency in spending”, he said.
He said that the principle focus of this budget is to build system processes so that the state can spend the money efficiently, usefully for the entire state and showcase a certain degree of progress and that is the key theme of the budget.
