They have almost promised the moon in Karnataka elections
It’s time for competitive populism in Karnataka. In this poll season major political parties in the state - BJP, Congress and Janata Dal (Secular) - are trying to outdo each other with poll sops, be it rice at Rs 2/kg, free TV sets, free power, or...
By TNN |
NEW DELHI: It���s time for competitive populism in Karnataka. In this poll season major political parties in the state ��� BJP, Congress and Janata Dal (Secular) ��� are trying to outdo each other with poll sops, be it rice at Rs 2/kg, free TV sets, free power, or free cooking gas. At a time when the country is contending with steadily rising prices, inflation based on wholesale price index is at 7.57%, none of the political parties seem to consider how they will actually make good on these promises. Given that is competitive populism at play, each political party is just keen on joining the race.
Both the Congress and the BJP have promised to provide subsidised rice to the poor (below poverty line families) at Rs 2/kg. At present it is sold at Rs 3/kg. This promise is a formula first tested successfully by Telugu Desam���s N T Rama Rao.
The Janata Dal (Secular) has refrained from joining the rice race, but has promised free cooking gas to BPL families, and free cooking stoves to BPL cardholders. This, perhaps, to match the Congress promise, a leaf from ally DMK���s book, to give free colour televisions to BPL families. There are about 72 lakh families below the poverty line in Karnataka, and another 400,000 families are seeking to be enumerated as BPL. Karnataka���s total voting population is about 4 crore.
What cost would all these freebies come at? In all likelihood, spending on populist schemes will mean a lower outlay for human development schemes. Karnataka was the first state to enact the Fiscal Responsibility and Budgetary Management Act in 2002. The legislation mandated that the government should limit fiscal deficit to 3% of gross state domestic product. This ensures that the state has a revenue surplus. Or to put it another way, it puts a restriction on borrowing.
But what this has meant in practical terms is reduced spending in the social sector. The Karnataka Budget which was presented in Parliament, on account of the state being under President���s Rule, bears this out. The revised estimates for the current financial year show that revenue expenditures for several key areas such as education, health, water supply and sanitation, welfare of Scheduled Castes and Scheduled Tribes and Backward Classes are either stagnant or lower than the budgetary estimates made for last fiscal year.
The state���s budget for 2008-09 presents a revenue surplus, which is estimated at Rs 2,972.65 crore. However, an increased wage bill will mean an increased expenditure of Rs 1,500 crore towards paying arrears. This would mean that whichever party forms the government would have a lower quantum of surplus to spare towards fulfilment of its poll promises.
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Even if the cost of financing these poll promises were worked out, there seems to be little consideration about ensuring delivery systems so that the sops reach the intended recipient. The absence of a thinking through by political parties would Rs 2 per kilo PDS rice scheme extremely vulnerable. All that the parties need to do is look further south where Tamil Nadu���s Rs 2 per kilo PDS rice scheme is being misused. This PDS rice is being sold at Rs 17 to Rs 18 a kilo in border districts of Kerala where rice scarcity is acute. The Congress and BJP have promised to supply free power to farmers ��� the BJP has promised free power to farmers with irrigation pumpset up to 10 HP, while the Congress has promised highly subsidised rate for farmers and free for some marginal farmers. The state already suffers from crippling shortages. In March, the state had a shortage of nearly 13%. How anyone plans to make good on this promise of providing free power, in a state that already is short of power has not been addressed.
Other unaccounted for promises include, a lower interest rate for farm loans (Congress), writing-off all debts of farmers and unorganised labourers (JD-S), government guarantee for bank loans to educated unemployed to start self-employment ventures, cyber cafes in every village (BJP).
Competitive populism can often get out of hand, and that would explain why JD(S), which is just released its manifesto, has promised to scrap Common Entrance Test, which governs admission to professional courses. How the party proposes to see this one through is difficult to fathom.
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