Kelkar questions leave officials red-faced

“We are aware that the state government attaches high importance to the administration of justice and rule of law,” Kelkar said in his speech. “We would,therefore,be looking forward to know the steps the state is taking to reduce the pendency of civil and criminal cases,which have risen in the 2004-07 period along with the number of undertrials in detention.”

Over half the state’s capital outlay is in power and roads. “We will be keen to know the impact of this expenditure on economic growth and productivity. We will also be keen to understand why investment in irrigation has not had a positive impact on agricultural growth and productivity,” he added.

Regarding public sector units,he said: “The state’s Accountant General has informed us that the aggregate losses of PSUs exceeded Rs 2,800 crore. In themselves,these figures are highly unreliable,since the accounts of 37 working PSU companies have been in arrears for a period ranging from one to 13 years as of February 2009.” Until this is resolved,“it will be impossible to secure the financial turnaround of these companies,” he said.

Expressing concern over the poor performance of the PSU power utilities,Kelkar said: “The T&D losses in UP are as high as 46 per cent,resulting in huge losses incurred by the power utilities despite the subsidies and grants from the state exchequer which are expected to touch Rs 2,678 crore in 2008-09. We will be keen to know more about the measures the state government proposes to alleviate this situation.” The state,he said,still has to work on debt management — the figure for 2007-08 was 50.6 per cent against the Commission’s suggested figure of 28 per cent. “Despite the drop in effective interest rates,interest payments continue to consume 20 per cent of non-plan revenue expenditure,” he said. “We would also like to understand why the state has been resorting to market borrowing despite having cash balances exceeding Rs 15,000 crore in 2006-07 and 2007-08”.

Identifying inclusive growth and poverty reduction as a key economic challenge for UP,Kelkar said: “The Planning Commission estimates the population below the poverty line in 2004-05 was over 32 per cent compared to the national average of 27.5 per cent. Urban poverty is also 5 per cent higher than the national average. Infant mortality rates are higher and literacy rates lower than the national average.”

The Commission,he said,will give serious consideration to the state’s memorandum with demand of vertical devolution share of all states,and for considering the entire proceeds of cesses,surcharges and service tax as part of the shareable pool.