A vain exercise?

It should spell out the reality, its departure from the plan, and an achievable and measurable physical and financial target.

In India, the presentation of the Union Budget is a big national event. All the major national television networks are busy the entire day showing the whole presentation in Parliament live; there are discussion sessions before the presentation and after the presentation is over. There is much hullabaloo over the budget with the finance minister making the entry with a slick attaché case which is portrayed as though it has some locked-up boon granting genie which the minister is going to release in the House. Within the House, during the presentation, there is much banging of the benches, clapping and occasional recitation of a poetry piece, a couplet, an Urdu sher or Tamil Tirukkural. Year after year this show has been going on with little ultimate result.

Actually, the Union Budget, the way it is presented, is so limited in its real content. It has always been all about a minor tax cut, a small change in the allocation of funds for some portfolio or activity, and a little up or down about import or other duties on some category of goods here and there. Yes, the middle class would be interested in checking if the income tax exemption limit has been raised and if so to what extent, and about any modification in the tax slabs. Some industry segment may groan and some other may cheer with the changes in the levy of tax rates or in the grant of subsidies for some time. But, everybody knows that it all gets sorted out or evened out with the passage of time. Time is a big healer in India. 

Indian government was always big about planning. As Indians, we all believe in contemplating the future – the longer or farther the better – and never bother to live now or in the present. If someone – preferably from one of the western countries – says that India will be an economic superpower in 2030 and includes us into the BRIC or whatever, we keep boasting about it endlessly with little thought and action to match those raised expectations. With no action to match, we wallow in the future. Our Planning Commission is a perfect representation of Indian mind and our style of governance. Even if some of the plans from the Yojana Bhavan, during the decades of its profligate existence, had come to fruition, we would have been a huge world power a long time ago. Himalayan on intent, we are a small hill indeed. 

Union Budget is another similarly vain exercise. In a typical Indian government fashion, it tells us about the ‘expenditure’ granted or allocated to different activities in different ministries. Yes, it also tries to tell us as to how the money may be raised to meet the total expenditure. However, one basic and extremely simple fact is glossed over. And, that is: spending of funds is not equal to producing tangible results. Say, for instance, 10 per cent more funds may be assigned to build primary schools; but, that may not translate into 10 per cent more school facilities in real. It may even result in status quo or worse. 

Account of plans

No government at the Centre has ever given an account of its plans last year vis-à-vis its accomplishments. That last year, say, 20 per cent more funds were allocated towards rural roads in the North-east; and that say that the paved roads have increased in length from ‘x’ kilometers to ‘y’ kilometers. Or say, four thousand crore extra funds were allocated in order to enhance the number of schools by two thousand. 

The budget should spell out the reality, its departure from the plan, the learning from the experience, and a realistic, achievable and measurable physical and financial target. This is a basic principle of management. Actually, simple common sense should suggest it. We all understand that the Union Budget is a ‘financial’ or ‘accounting’ exercise. We understand that the expenditure outflow should try to balance the inflow. 

But, should that exercise not be directly connected to the physical target? What is the point in just trying to balance money flows without reference to the real object of the money flows? Shouldn’t the target be mentioned in a specific measurable manner? Isn’t it the responsibility of the government to declare as to what was actually achieved as compared to the last year’s plan? It has a responsibility towards the citizens as regards the question as to how well the funds are being utilized in achieving the tangible physical targets desired by the people of the country. Mere financial accounting would amount to providing a blurred picture. It raises questions about the true intentions of the government. Many governments have done so earlier in order to draw wool over the people’s eyes.

There are so many basic issues facing the nation. Food to provide the minimum calories intake, potable water to drink, basic healthcare, rudimentary hygiene and sanitary surroundings which include at least a somewhat closed toilet, primary education, a dwelling of whatever quality and a cloth however coarse to cover the body are the needs at a very fundamental level. However, these are beyond the reach of the men and women who form a huge portion of our population. That is the real India. Those are the ‘aam aadmis’.

 The budget should say in no unclear terms as to what the government is going to do for these. There is no point in presenting financial jugglery or resorting to accounting calisthenics. Such ‘budgets’ will not take us too far. We need a people-oriented ,performance specific declaration by the government. Call it by any name: union budget or whatever. Modi’s new team at the Centre which, in many ways, is a pioneering political experiment, would hopefully follow these basic instincts.

(The writer is a former professor at IIM, Bangalore)

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