OdishaPlus Bureau

Less increment in overall Expenditure budget as compared to previous year

During 2018-19 states total expenditure was estimated (revised Estimate) at Rs.120125.00 with an increase of 23.19% more over the 2017-18 actual expenditure. However, expenditure for 2019-20 is estimated at Rs.139000.00 Cr. which is only 15.71% more over the 2018-19(RE).

Capital expenditure not given proper Emphasis

The total of Capital Outlay, Disbursement of loan and Repayment of loan constitute Capital Expenditure. Within the capital expenditure the expenditure which results in the creation of permanent assets is termed as capital outlay.

In the budget 2019-20 the state has not given emphasis for capital expenditure, specifically on capital outlay. Total capital expenditure excluding debt repayment during 2019-20 is estimated to be Rs. 25555.09. However, during 2017-18 the capital expenditure excluding debt repayment was Rs. 22983.97 Cr… It clearly implies the state has given very less emphasis for capital outlay.

Fiscal deficit more than double in 2 year

Fiscal deficit is one of the most important indicators of financial health of the state. It is the excess of total expenditure (both Revenue and Capital) over the total receipt (Revenue+Capital) of the state excluding receipt through loan/debt.

Fiscal deficit for 2019-20 is estimated at Rs. 18877.00 Cr. which is almost double of the fiscal deficit during 2017-18 (Rs. 9359.49). On the one side there is less growth of the total expenditure over previous year and on the other side during the same time fiscal deficit is becoming double.

Borrowing more to meet the expenditure

To meet the total budgeted expenditure of Rs139000.00 Cr. for the year 2019-20, the state estimated to borrow Rs. 22734.00 Cr., which is around 16% of the total expenditure. However borrowing was 13% of the total expenditure during 2017-18. On the other side the state is not increasing the capital outlay substantially. It implies the states dependency on borrowing to meet the demand is increasing, although the states borrowing is less as compare to other developed states.

Health Sector

The allocations for Health and Family Welfare have increased from in Rs 6158.96 Cr in 2018-19(RE) to Rs 6804.85Cr. in 2019-20(BE) with an increase of Rs 570.57 Cr. However the share of health expenditure in state budget has decreased from 5.13 percent in 2018-19(RE) to 4.90 percent in 2019-20. Similarly as % of GSDP health and family welfare budget is 1.26% for 2019-20(BE) which was 1.27 for 2018-19(RE).

In 2017-18, Odisha had budgeted Rs 5712.33 Cr for Health and Family Welfare Department, of which actual spending stood at 4,926 Cr respectively, showing significant gap persists between the budget estimates and actual expenditure.

National Health Mission (NHM), a centrally sponsored scheme, was launched to strengthen the delivery of health care services. NHM accounts for 19.62 percent of total health budget with allocation in budget 2019-20 (BE) being Rs 1,335.28 Cr. This is an increase of Rs 26.61 Cr from 2018-19 (RE).

The Niramaya Scheme which came in May 1, 2015 envisages providing 593 types of free medicines at public hospitals. The high cost and long-term use medicine for diseases like cancer, diabetics, hypertension, psychiatric, blood disorders are also provided under Niramaya. The budget allocation for free medicine is Rs 233.42 Cr which was Rs 301.21 cr in 2018-19 RE and Rs 273.5213 Cr.

An amount of Rs.1,203 crore is allocated for  “Biju Swasthya Kalyan Yojana (BSKY) scheme in 2019-20. There, no doubt, is a wonderful welfare scheme.  Unfortunately there is no data available publicly on the number of beneficiaries covered under RSBY.  The de-layering of the implications has begun with different news reports giving different views but the reality seems to give way to doubts and misgivings.

School and Mass Education

For 2019-20(BE), an amount of Rs 16400.00 Cr has been allocated for School and Mass Education (S&ME) Department which was Rs. 15018.97 Cr. for 2018-19(RE). The current allocation is Rs 1,381 Cr more than the 2018-19(RE).

Share of S&ME Department in the total state budget has declined from 12.50 percent in 2018-19 RE to 11.80 percent in 2019-20(BE). Similarly, as percentage of GSDP S&ME Department budget has decreased from 3.09% in 2018-19(RE) to 3.03% for 2019-20(BE).

Water and Sanitation

Total budget for Water Supply and Sanitation for FY 2019-20 is Rs 7339.49 Cr. Of the entire budget around 82% of budget is allocated towards rural sector i.e. Rs 5989.16 Cr.

Allocation towards SBM (Rural & Urban) is Rs 2590 Cr for the FY 2019-20. During 2018-19 FY it was Rs. 2167 (RE) Cr.  The target of SBM is getting over by 2nd October 2019. As per the data of SBM (Rural), 57 blocks out of 314, 4 districts out of 30, 2151 out of 6798 Gram Panchayats are open defecation free.

Allocation for Buxi Jagabandhu Assured Water Supply to Habitations (BASUDHA) for Rural & Urban areas is Rs 2740 Cr & Rs 382.9 Cr respectively. There is a hike of around 35% between 2018-19 (RE) and 2019-20 (BE) financial year. During 2018-19 (RE) it was 1100.1 and for 2019-20 FY budget allocation for this sector is 3122.9;

Allocation for National Rural Drinking Water Supply Programme (NRDWSP) is Rs 500 Cr. During 2018-19 (RE) the budget was Rs 300 Cr;

A new scheme i.e. Piped Water Supply Projects (PWSP) is introduced with a budget of Rs. 5000 Cr.

Highlights of Separate Agriculture Budget 2019-20

  • Total size of Agriculture Budget is Rs 20714 Cr, which is a 23.5% increase from the last budget which allocated Rs 16,765crore.
  • Share of Agriculture budget to total State Budget in 2019-20 is 14.90%.

farmerMajor Deviations

  • Increased towards agriculture and farmers welfare department from 27% to 42% with a lump sum allocation worth Rs 5501 crore made towards KALIA.
  • Share of Cooperation department almost remains same @ 7% of the total agriculture budget.
  • Reduction in share of Water resources department from 61% to 47%. It is expected that Input support towards irrigation has been squeezed.
  • Despite animal resources and fisheries being the potential areas its share has declined from 5.33% to 4.32% in 2019-20

Critical Areas

Allocations substantially reduced for Rastriya Krishi Vikas Yojana (from Rs 750 Cr to Rs 400 crore), Integrated Watershed Management Programme (from Rs 155 Crore to Rs 50 crore), Biju Krushak Kalyan Yojana (from Rs 90 crore to Rs 42 crore).

Agriculture Extension services remains out focused in Budget

Allocation for agriculture extension services has remained continuously low since years and this remains the primary cause of failure in implementing the schemes as acute shortage of human resources remains an alarming issue. Allocation under head Submission on Agriculture extension reduced (from Rs 228.45 crore to Rs 150 crore).

Organic Farming gets no greater attention

Paramparagat Krishi Vikas Yojana the flagship scheme to promote Organic farming gets no increased allocation. Allocation remains same @ Rs 30.53 crore as in 2018-19.

Rs 64.9 crore is provided under the umbrella scheme of ‘White Revolution’ for development of dairying and livestock management which is a sharp reduction from last year’s which allocated Rs 84.33 crore.

(The analysis is done by Odisha Budget and Accountability Centre (OBAC), CYSD)

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