Plan panel cuts State’s plan to size

This is the first time in the history of Maharashtra that it has been asked to cut its plan size at the discussion stage itself. During the Sena-BJP rule, the then Deputy Chairman of the Planning Commission Madhu Dandavate had asked the State to reduce its plan size, but subsequently he (Dandavate) did not press for it after the then chief minister Manohar Joshi argued that the State was in a position to mobilise resources to implement the plan.

Planning Commission Deputy Chairman K C Pant specifically told Chief Minister Vilasrao Deshmukh and Deputy Chief Minister Chhagan Bhujbal that in the absence of adequate resource mobilisation, it would not be appropriate to approve the plan of such a huge size. “Pant suggested to Deshmukh and Bhujbal that either the plan size be reduced or the Government should draft a separate core plan to implemented developmental schemes on priority basis,” a senior official said.

In his brief speech, Deshmukh said though it was the largest plan in the country, his Government has taken care to ensure that it is not beyond his means to finance it. “Our resources have been under strain, as of all other states, due to implementation of the recommendations of the Fifth Pay Commission. Last year, we had to pay the arrears, in addition, we had to provide Rs 1,500 crore for harnessing Krishna waters,” Deshmukh said.

Shocked Planning Department officials say, “at this juncture it will be difficult to cut the plan size. We assured the Planning Commission that we will mobilise resources to ensure that the plan, which has been approved by the Legislature, is implemented in letter and spirit. In fact, we feel that it was beyond the powers of the commission to recommend us to cut the size of the plan,” the official said.

Pant felt the State Government should initiate stringent measures to improve the performance of the Maharashtra State Electricity Board (MSEB) as well as the Maharashtra State Road Transport Corporation (MSRTC). “Both the State-run enterprises are running in heavy losses. While the losses of MSEB stood at Rs 960 crore, accumulated losses of MSRTC stood at Rs 800 crore,” the official said.

In his budget speech, Finance Minister Jayant Patil had stated that out of the deficit of Rs 750.43 crore, he will make good Rs 331.64 crore by way of resource mobilisation proposals, which would result in the reduction of the deficit to Rs 418.79 crore. Similarly, owing to additional burden of Rs 329 crore, the deficit will again increase to Rs 747.79 crore. Jayant Patil had stated that, while the deficit will be left uncovered, suitable steps will be taken during the course of the year after discussions with the Planning Commission and final recommendations of the 11th Finance Commission.

Apparently, the Planning Commission was irked by the huge uncovered deficit. It insisted that the Government should initiate immediate measures to reform the existing taxation system to mobilise more resources.

Significantly, the Planning Commission did not take note of Chief Minister Vilasrao Deshmukh’s demand for a special assistance of Rs 1,355 crore for Mumbai for next 10 years and Rs 217 crore to tackle the drinking water scarcity in 11,840 villages and 5,925 hamlets. In addition, the Chief Minster had also asked for a financial assistance of Rs 296 crore for Kumbha Mela at Nashik during 2003-04, the preparations for which will begin immediately.

Former chief minister Narayan Rane said the advice of the Planning Commission to cut the plan size was a major setback for the State Government. “We were in power for four and half years. We also drafted huge plans, but we were never asked to cut the plan size. The advice has adversely affected the credibility of the Congress-led Democratic Front Government,” Rane said, adding, developmental projects will be hit due to the decision..

Rane said the crisis-ridden Democratic Front Government has already imposed a 20 per cent cut on the non-Planned expenditure.