NEW DELHI: In the wake of increasing pressure from the industry to raise infrastructure spending to boost consumption, the expenditure on social schemes is likely to be cut in the upcoming budget.
“For the budget 2020, fiscal headroom is limited. Infrastructure spending will continue but do not expect any increase in social spending. Naturally somewhere the government will cut corners,” a senior official, finance ministry told this publication.
As reported earlier, the finance ministry had already asked other ministries to remain prudent in the demand of budget and had asked them to prepare their grant request according to the current economic realities.
For instance, the National Health Authority, which implements government-run cashless health scheme — Pradhan Mantri Jan Arogya Yojana, popularly referred to as ‘Ayushman Bharat’, has sought Rs 7,915 crore from the finance ministry in 2020-21.
Despite many private hospitals pulling out of the scheme overpayment issues, a budgetary spike is unlikely, sources said.
Similarly, in the last year budget, the government doubled the allocation to the National Rural Drinking Water Mission to Rs 10,001 crore from Rs 5,500 crore in the revised Budget 2018-19.
Despite the announcement made by the prime minister, hiking the budget further for the scheme looks difficult.
“The internal consultation does not see any major revisions of the grant, barring, some of the pet schemes, with larger political implications, may grab more allocation,” the official said.
The percentage of GDP on education has remained stagnant at about 3 per cent during the past few years.
After the pre-budget meet on December 19, the state governments had flagged concerns over lower expenditure on the social scheme and requested the finance minister to not curtail the welfare schemes, which will further hit the poor, said Amit Mitra, finance minister West Bengal.