Budget session curtain raiser: Punjab govt may appeal to big farmers to surrender power subsidy

“The CM will be appealing to all the members of the Punjab Legislative Assembly to surrender the subsidy. The Assembly has many big farmers, including former chief minister Parkash Singh Badal," said a government official.

Written by Kanchan Vasdev | Chandigarh | Published:June 10, 2017 4:41 am
Punjab Chief Minister Amarinder Singh (PTI Photo)

Burdened by a fattening power subsidy bill, running into crores, and yet continuing with free power to farmers as part of its pre-poll promise, the funds-crunched Punjab government is thinking of appealing to big farmers in its maiden budget to surrender subsidy so that the state could help the debt-ridden farmers.

Chief Minister Captain Amarinder Singh, who according to sources, has a 35-acre farm in his Moti Bagh Palace, is likely to lead by exampleand surrender the power subsidy on the floor of the House. Following this, other ministers and MLAs of the Congress are likely to follow suit. The free power was supplied to all farms in the state, irrespective of the farmers’ income.

“The CM will be appealing to all the members of the Punjab Legislative Assembly to surrender the subsidy. The Assembly has many big farmers, including former chief minister Parkash Singh Badal. The announcement is being made as part of the budget speech of the finance minister,” said a government official. The budget would be presented on June 20.

Estimating a power subsidy bill to the tune of Rs 10,000 crores, including about Rs 5,600 crore as last year’s bill, Rs 2,300 crore as arrears and another expenditure of about Rs 2,500 crore, the government would find it difficult to sustain it. It is now banking on the big farmers to surrender the subsidy and save whatever it can. “Even if we save Rs 2,000 crore, it can help us pay up the installment of loan waiver,” said the functionary.

The Congress government, while in its last stint from 2002-2007, had done away with free power supply to the farmers. Though the government resumed it before the next election, it could not retain power in 2007 and farmers were believed to constitute a major chunk of voters who kept the Congress out of power. Not taking any chances this time, Amarinder had made an announcement before elections that power subsidy would continue.

The state government, working overtime on preparing the budget, is likely to present a tax-free budget this time. A government functionary said they are startled that the revenue deficit was almost working out to be Rs 13,000 crore and a supplier’s credit of a whopping Rs 17,000 crore was staring in the state’s face. Supplier’s credit is calculated after considering all the pending salaries, rentals, post-retirement benefits, material components and other bills pending.

The state is banking on GST as lion’s share of income. GST receipts of Rs 23,000 crore are expected to fill the state’s coffers in the current fiscal against an income of Rs 18,000 crore last year.

While the budget document has not been finalised yet and was being tweaked everyday, sources said the government had planned to hike the old-age pension by Rs 250 this year. Currently, the pension is Rs 500 and after the buget, the beneficiaries will get Rs 750 per month. The government plans to raise it by Rs 250 every year. The Congress, had in its manifesto, promised to raise the pension to Rs 2,000 every month.

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