Union Budget 2016-17 is Actually an Anti-Poor Budget Concealed in Tri-Colour Package

Archive Articles, Economy

(This article was first published in March 2016 in the previous version of People’s Review. Due to an incident of hacking the old website was pulled down and we could only restore the old articles in this section)

The Union budget for the FY 2016-17 presented by Finance Minister Arun Jaitley and hailed by the corporate media, the business houses, and TV panellists as a pro-poor budget, actually is a hollow budget filled with unrealistic hollow claims, extreme rhetorics, designed to deceive the people in a crucial election year.

Finance Minister Arun Jaitley made tall claims about the Modi government’s concern for the rural poor and claimed that his budget will focus on making the lives of the farmers and rural poor better. In reality, since it has ascended to power, the BJP regime led by Narendra Modi has worked overtime to dismantle the last vestiges of minuscule social security that the poor people of India enjoyed. Only after the poll debacle in an electorally crucial state like Bihar, the BJP donned the attire of a farmer evangelist, while its policies have driven the farmers to the verge of the acute financial distress.

 

What does the rural poor of the country gains from the Union budget of FY 2016-17?

If we critically analyse the Union budget 2016-17 then we will find the accurate answer to the question of what are the gains of the poor people from the budget presented by Mr Jaitley to the parliament.

 

A big hoax on MNREGA

The Niti Ayog, which the BJP government established by dismantling the Nehruvian planning authority, earlier gave its recommendations on winding up the Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA), the only social security scheme of the government, which despite numerous shortcomings and extreme corrupt practices, help the rural poor to earn a meagre amount to survive during the lean season.  

Over the last few years, the allocation to the MNREGA has drastically plummeted, which was used as a pretext by Arun Jaitley to suddenly claim that he is going to allocate the highest amount in the MNREGA, which was a Congress flagship scheme during the UPA rule. The allocation made by Finance Minister Mr Jaitley in the MNREGA scheme for FY 2016-17 is Rs.38,500 crore. This amount, though higher than last year’s Rs.34,699 crore allocation for MNREGA, however, falls short of the Rs.40,100 crore allocated to the scheme by the UPA government in 2010-11. Thus, the claim of the Finance Minister have been categorised as extremely hollow and a mere deceitful rhetoric alike the usual campaigns of the RSS and the BJP.

The MNREGA have been systematically neglected by the Congress and the BJP government over years, except during the heights of the anti-tribal and anti-Naxal war of 2009-11, when the additional emphasis was given on the programme to wipe off some amount of discontent from amongst the rural poor to tackle the growing insurgency.

The year 2015 was a drought year, the farmers of the country, especially the poor and the landless peasantry faced an extreme crisis. Farmer suicide rate due to extreme financial distress rose to 52 a day and more families in rural India were thrown into utmost pauperism due to debts, mostly taken from unscrupulous feudal money lenders.  

Under this circumstances, it was the prerogative of the government to provide at least 200 days of employment to the people, which could have provided little relief to the rural poor. However, as per the data available until February 2016, only 38 average work days were created in 2015-16. Apart from the inadequate work day creation, the Finance Minister even backtracked on his own pledge, when he refused to allocate more than Rs.2000 crore to the MNREGA scheme in FY 2015-16 while he promised during the budget session to allocate up to Rs.5000 crore additionally to the MNREGA scheme, in case the need arises.

There is an arrear of Rs. 6000 crore due, also a conservative estimate of the March 2016 expenditure, which is not calculated yet, will be around Rs. 3000 crores.  

Even if the highest allocation of Rs. 40,100 crore during the UPA government is considered the ideal figure, then going by the current inflation rates the FY 2016-17 budget allocation for the MNREGA scheme should have been not less than Rs. 65,000 crore from a conservative estimate.

The allocation of Rs. 38,500 crore is not only far less than what should have been invested to help the poor sustain, rather it is a farce, a cruel joke by the richest of the rich and their representative Mr Jaitley.

 

The reality of the pro-farmer budget

The Finance Minister, Mr Jaitley, claimed that the BJP government under Narendra Modi is planning to double the income of the farmers. It was an attempt to bootleg the old wine in a new bottle. Firstly, the Finance Minister did not specify which class of the farmers will have their income doubled. Secondly, his second claim was also a hollow rhetoric as he said that the period required to double the income of the farmers will be five years. Now, as per recent information, farmers of 17 states of India earn around Rs. 20,000 per annum. It is around Rs. 1600 a month for each farming households. Now if the government takes five years to double it to Rs.3,200, then as per the growing inflation ratio that doubled income will have no more significance.  

The Modi government has planned to develop more infrastructure, mostly roads and railways to densely connect the rural interior of the country with the big cities. The Finance Minister claimed that the infrastructure building will connect the farmers better and will ensure their easier access to the markets.  

However, in the context of ongoing mining aggression into the hinterland of the country, especially at a time when the foreign and domestic mining giants are penetrating deep inside the tribal belt of India, using their huge stash of cash to dictate policies of state and central governments and have made the government of India declare a war on its tribal people, who are refusing to hand over their land, forests, rivers and overall livelihood to the giant foreign corporations and their Indian comprador allies, the projects of rural infrastructure development along with the huge allocation for capital expenditure in developing roadways, seems more inclined to provide the corporate bodies and the security forces a leverage to battle and isolate the tribal and aboriginal people of India.

Another farce of this so-called pro-farmer budget is the Rs. 3000 crore cut in fertiliser subsidy for the FY 2016-17, which will eventually increase input cost of farming and make it quite harder for the poor and landless peasantry to continue with the profession.  

 

Union Budget 2011-2021 An anti-Tribal and anti-Dalit budget

Following the general discourse of the Brahminical fascist policies of the RSS controlled BJP government in New Delhi, Finance Minister Arun Jaitley has made the Union budget 2016-17 an anti-Dalit and anti-Tribal budget by reducing the allocations of the welfare funds for people of these communities substantially.

The Tribal sub plan expenditure is only 4.4 percent when it should be 8.6 percent. The Dalit (SC) sub plan expenditure is 7 percent when it should have been 16.6 per cent.  

There has been less allocation for minority welfare as well when the socioeconomic condition of the minority communities is at its worst.

The less allocation for the Dalit and Tribal sub plans show the mockery of the Brahminical fascist system, which is inclined to serve the interests of the upper caste Hindu elite group, the core vote bank of the BJP.

The anti-poor theme of the budget

Despite the cheerleading by the government supporters, corporate honchos, market experts, the Union budget 2016-17 presented by Finance Minister Arun Jaitley has several anti-poor and anti-national undertones, quite visible during a critical analysis.

The Union budget for the FY 2016-17 has clearly failed the poor’s when Finance Minister Arun Jaitley, despite his crocodile tears for the poor, reduced the allocation for food subsidies for FY 2016-17 by Rs. 5000 crores. This will have a serious impact on the Public Distribution System, which is already on the verge of its collapse. The food security programme for the poor people of India will suffer badly and the profiteering by the traders and hoarders will shoot up due to this reduction and will hurt the poor more badly.

 

Taxing the poor and appeasing the rich

In continuation of the general trend of the Union budget of FY 2015-16, during which the Finance Minister Arun Jaitley declared the reduction on corporate taxes from 30 per cent to 25 per cent within four years, the Union budget presented by him for FY 2016-17 showed a continuation of the same trend. There had been sops declared for the corporate entities, even the entire capital expenditure for road and railways development has a more pro-corporate than pro-people vision.

Tax collection scenario showed a grim picture, there have been significant downfall indirect tax collection during the FY 2015-16, even if the data for March is later compiled the situation does not seem to improve. Revenues from corporate and personal Income Tax is far short of the Budget Estimate of FY 2015-16, the shortage is Rs. 46,000 crore.  

 

The new tax proposals have nothing new than providing sops for the rich by taxing the poor.

The direct tax proposals made by the BJP government in the Union budget for FY 2016-17 will lead to a revenue loss of Rs. 1060 crore, which will be an added benefit for the rich than the middle classes.  

The imposition of extra indirect taxes will add Rs. 20,670 crores of liabilities on the common people.  

The anti-worker policies reiterated

The Union budget 2016-17 did not bother to answer how the BJP government is planning to meet the planned expenditures for FY 2016-17 as the government will have to allocate extra funds to implement the 7th Pay Commission. There is no headway on how the government will pull in the extra money and what will be the fiscal deficit due to the implementation, which will be more than Rs.92,000 crore. The only avenue that the government is showing to the people is a rapid drive of disinvestment of Public Sector Units (PSU) from which the government plans to earn Rs. 56,500 crore in the FY 2016-17. The stake sale of the PSUs by the government since the Vajpayee days has become a favourite route to raise money for the government and the Indian ruling classes. The PSUs created with the money of the common people is now turned into a milking cow to meet budget deficits. The selling of the PSU stakes to the private players, mostly acting as a proxy of the Foreign Institutional Investors and multinational corporations is strongly objected by the labour unions, as the speedy privatisation process has dismantled the minimal security the working class enjoyed in the PSUs, privatisation has also made outsourcing and contract labour hiring a popular policy of the bureaucratic capitalists and their foreign stakeholders.  

The Finance Minister unveiled the acute anti-worker orientation of the BJP government when he proposed to tax 60 percent of the corpus of all Provident Fund and Pension withdrawals from April 2016. This is a double taxation on the workers and employees, who have already paid taxes, if any, from their salary during their employment period. The Finance Minister and the bureaucrats of the Finance Ministry tried to battle the barrage of attacks from the labour unions and employee associations with hollow justifications and clarifications. The labour unions, including the RSS affiliated BMS, has strongly opposed the proposal and have declared to take the fight to the streets.

If we collate all the data given above and observe with a critical outlook, it will become evident for us that the so-called pro-poor and pro-farmer Union budget for FY 2016-17, placed in the parliament by Arun Jaitley, is actually an anti-poor, anti-farmer, anti-worker, anti-Dalit, anti-Tribal, anti-minority, and anti-national budget, which has arrived packed in a populist  tri-colour jacket, however, it ultimately aims to turn India into a bastion of corporate loot and plunder.

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