Polls preclude 'regular budget' Govt. plans vote-on-account

By Our Special Correspondent

CHENNAI, DEC. 9. The State Government would go in for a vote-on- account for the first three months of the next financial year, beginning April 2001.

With elections to the State Assembly expected to be held in April next year, a regular budget for the year 2001-02 by a new Government would be possible only in July next, official sources indicated.

The new Assembly will have to be in place by May 22, 2001 and it would take at least a month for the budgetary exercise to be completed.As the current financial year steers towards its last quarter, sources said though the State's overall fiscal position was under `stress', the budgetary targets were within achievable limits.A major loss this year, has ironically been due to the recommendations of the 11th Finance Commission, with relatively better developed states like Tamil Nadu getting a raw deal.

Central devolutions will fall to the tune of Rs. 370 crores this year alone, sources pointed out. The cumulative loss to the State over the next five years would be about Rs. 4700 crores.

Affected states like Tamil Nadu are now awaiting the Commission's final report, to be placed in the current session of Parliament, on how the Centre proposed to make good the losses to them. This is after these states under the leadership of the Andhra Pradesh Chief Minister, Mr. N. Chandrababu Naidu, had taken up with the Centre, the adverse impact of the first report.

Meanwhile, a big slice of comfort for the State Government has come from the growth rate in Sales Tax (ST) this year at 20 per cent compared to about 13 per cent in the previous year.

Sources said, among the three main manufacturing segments contributing to the bulk of the ST, textiles and leather have `picked up'. The automobile sector continued to be sluggish without causing any major worry in meeting budgetary targets.

In terms of two key indicators of the states' fiscal health - the debt to the State GDP ratio and interest outgo as a percentage of revenue receipts - Tamil Nadu was better off than most Indian states, sources added.

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