KOCHI: Coming out heavily against the Union Government, Chief Minister Pinarayi Vijayan on Tuesday alleged that the Centre is attempting to scuttle the state government's alternative welfare policies for the poor by imposing a heavy financial burden.
"We do not have a treasury that is overflowing with money. It's a fact that the state is experiencing a financial crisis. However, the direction put forward by the central government to overcome the crisis is to wind up all the social welfare schemes. That will not happen," he said, delivering the inaugural address of the Kerala NGO Union's diamond jubilee celebrations in Kochi.
The CM also said that BJP runs the government for the corporate houses, and it is they who are ignoring the poor. The state government is attempting to implement alternative programmes for them, said Pinarayi citing that KIIFB has been launched for taking up basic infrastructure development such as roads, bridges, public schools, etc.
"Our plan was to implement projects worth Rs 50,000 crore. But, KIIFB took up projects of Rs 65,000 crore. The Centre's stand is that the fund spent by KIIFB would be considered as the loan borrowed by the state government. However, this is not applicable for the Centre's institutions such as the National Highways and Infrastructure Development Corporation Limited under NHAI and the National Bank for Financing Infrastructure and Development," he said.
"The total expenditure of the country as per the Union Budget is about Rs 39 lakh crore and of this about Rs 17 lakh crore is through borrowing. Or 43.6% of the total revenue of the Union Government is through borrowings. In Kerala's case, this is only between 20-25%. The people who have borrowed 43% of loans are lecturing us about limiting our borrowing," he said.
Recently, the Union Finance Minister responded that the GST compensation to Kerala is only Rs 780 crore. It is a misleading statement. In reality, Kerala stands to be deprived of Rs 12,000 crore annually with the discontinuation of GST compensation.
The Centre’s decision to consider the guarantee provided to the Kerala Infrastructure Investment Fund Board (KIIFB) and Kerala Social Security Pension Ltd (KSSPL) as state debt is a denial of Rs 12,500 crore as a loan which is a rightful share of the state. This has turned a double jolt to the state which is overcoming the Covid crisis as there is a decline of Rs 24,000 crore in the state's total revenue in this fiscal, Pinarayi said.
The state governments bear 64 percent of the public expenditure, but they get only 37% of the tax revenues. Hence the states such as Kerala have been demanding that the GST revenue share of states should be hiked from 50-60%, the CM said.
Also, the central government wants the state's deficit to be brought down below 3% of GSDP. Whereas the central government's fiscal deficit is at 6.4% of GDP in the current financial year. Last year, it was around 7% and the previous year it was around 9%. In comparison, Kerala's revenue deficit was brought down to 2.8% in the current financial year. This was earlier 4.1% and 4.4% in the previous years.
Industries Minister P Rajeev released the logo and theme song of the Kerala NGO Union diamond jubilee celebration at the function.