Expect Welfarist Budget This Time

Social sector spending through NDA’s hallmark schemes likely to go up as polls are around the corner

Published: 12th February 2016 03:20 AM  |   Last Updated: 12th February 2016 03:20 AM   |  A+A-

NEW DELHI: With elections in several States around the corner and a few more scheduled for next year, the Union Budget is likely to have a welfarist tinge with social sector spending going up through the NDA’s hallmark schemes: insurance schemes, lower interest for housing and dole for the old and employment and protection for the girl child.

By all indications, Finance Minister Arun Jaitley will enhance the social welfare catchment area not just by streamlining and higher targeted allocations for existing schemes like the MGNREGA, but also through new initiatives to address the rural distress following two consecutive droughts. Welfare schemes that address the urban poor and needy too could be announced. The focus on welfare would not just be limited to giving out distress dole but is being designed in a manner that aids development of productive human resources and creates lasting infrastructure in the rural and urban hinterland.

In what could look like a tempering of Prime Minister Narendra Modi’s earlier approach of steering government policies towards triggering growth and ease of business and allowing economic growth to percolate down, the Prime Minister’s Office is now pushing for greater focus on the social sector but with an emphasis on grouping multiple social welfare programmes into a linear cradle-to-old-age schematic framework - only for targeted groups.

Since the economy has not picked up in the manner the government would have wanted and the not-so-conducive global economic environment is adding to its worries, the government has come to the conclusion that it can’t wait to ease distress along the way. It also wants to take the sting away from the Opposition’s charge that Modi has a “pro-corporate” bias.

For the middle income group and young homemakers, the housing sector will receive attention, and tax rebates for first-time home buyers could be expected.

The dole on housing for the needy is also likely to increase. Similarly, small savings which were once seen to lend solidity to the banking sector as well as economy, will be incentivised.

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