Government of Mizoram
Budget Speech: 1991-92
By Pu J.Lalsangzuala
Mr. Speaker, Sir,
May I have your permission to have the honour to
rise before this august House to present the Revised Estimates for
the current year 1990-1991 and the Budget Estimate for the next year
2. Before presenting these estimates, I would like
do dwell a little on the background of the financial difficulties
the State has been experiencing right from its inception. Their genesis
lay in the faulty assessment of the State’s financial requirements
made by the Planning Commission for 1988-1989. As a result, we had
overdrafts of Rs. 53.41 crores and Rs. 59.47 crores at the end of
those two years respectively. Thanks to the efforts made by our Hon’ble
Chief Minister at the highest level that the Government of India constituted
a Committee of Senior Officers headed by Dr. P.D. Muherji, Consultant,
Planning Commission, to look into the matter. The committee recommended
additional Central assistance of Rs. 76.79 crores to seet right the
errors. I am glad to say that Rs. 72.09 crores of this has by now
been released to us and the balance of rs. 4.70 crores may also be
made available soon.
3. As brought to the notice of Hon’be Members in
my last year’s speech, Mizoram on becoming a State inherited a huge
Central loan liability of over Rs. 200 crores whose servicing proved
a big drag on the nascent State’s limited resources. As this liability
was mostly because of the unrealistic Central assistance pattern applicable
to the erstwhile U.T., the State Government of India for the write
off of this burden in full. The relief of Rs. 110.49 crores afforded
by the Ninth Finance Commission in respect of liability on Plan account,
though welcome, did not go far. Unfortunately, the government of India
also has not acceded to our request for further relief. Accordingly,
we are required to pay to the Centre in respect of these loans in
the current year 1990-1991 an amount of over Rs. 65 crores, including
arrears of about Rs. 54 crores for 1988-1989 and 1989-1990. This has
caused a considerable strain on the State’s already difficult financial
4. Another problem has been caused by the inadequacy
of the Central assistance for the current year’s Annual Plan. For
an outlay of rs. 125 crores, Planning Commission originally allocated
a Central assistance of rs. 90.58 crores only, requiring the State
to find Rs. 34.42 crores from out of its own sources. With great difficulty
the State Government has still to find an amount of rs. 20.08 crores
for the Plan in 1990-1991 over and above its -Plan commitments. This
is an impossible task viewed in the light of the fact that the State’s
contribution for 1989-1990 Plan was limited to Rs. 1.08 crores only.
NINTH FINANCE COMISSION:
5. The Ninth Finance Commission which submitted its
second report for the five year period 1990-1995 set right the injustice
done to the State in its first report for 1989-1990 in the matter
of devolution of taxes. The Commission recommended a total devotion
of Rs. 1017.26 crores to Mizoram on non-Plan account over the five
years (1990-1995_ Rs. 637.47 crores by way of share of taxes and Rs.
379.79 crores by way of gran-in-aid under article 275 of the Constitution.
Further, as stated earlier, the Commission recommended write off of
Rs. 110.49 crores out of the Central loan outstandings of rs. 113.53
crores on Plan account as at the end of 1989-1990. the Commission’s
recommendations provided to the State additional rrsources including
debt relief of over Rs. 35 crores in 1990-1991. However, the Commission’s
recommendations fell far short of our requirements. It made an unrealistic
assessment of the returns from investments in electricity, transport
etc. Secondly, unlike the preceding Commissions it did not cover the
committed liability for the maintenance of completed Seventh Plan
schemes in the grant-in-aid recommended for non-Plan account. We,
therefore, had no alternative but to show this liability as part of
Plan outlay in the Eight Plan. Lastly, the scheme for its debt relief
was partial as not to cover the non-plan loan liability.
6. For 1990-1991, the first year of the Eight Plan,
the Planning Commission fixed the size of the State’s Annual Plan
at Rs. 125 crores. On present indications, this outlay is expected
to be fully utilized. In addition, this outlay of Rs. 1.45 crores
was incurred on Aizawl Drainage Scheme.
7. As for 1991-1992 Plan the outlay approved by the
Planning Commission is Rs. 150 crores, representing a step up of 20
percent over that for the proceeding year. This step-up is one of
the highest allowed in the case of any State. As earlier, our emphasis
will be on agriculture and rural development. Of the total outlay
of Rs. 150 crores, Rs. 47.38 crores accounting for about one third
of the total is earmarked for these sectors. It is noteworthy that
the step-up in outlay on programmes under NLUP in 1991-1992 is more
than 70 percent. Other important allocations are Rs. 19.00 crores
for roads and bridges, Rs. 22.60 crores for Power, Rs. 11.33 crors
for Water supply and Sanitation, Rs. 8.75 crores for Industries and
minerals and Rs. 10.47 crores on Education and allied activities.
I take pride to say that Mizoram would be the first State in the country
to achieve complete eradication of illiteracy by 1991-1990. A booklet
highlighting the performance in 1991-1992 of various Departments has
been circulated separately along with the Budget documents. I do not,
therefore, propose to go into the same there.
REVISED ESTIMATES FOR 1990-1991:
8. I had in my speech last year stated that the year
1989-1990 may close with a deficit of Rs. 65.26 crores. However, according
to the Reserve Bank’s account, the actual deficit was much smaller
at Rs. 18.35 crores only. This was mainly because of State Government
not paying to the Centre the dues in respect of U.T.period loans provided
for earlier, pending decision on State’s request for write off of
9. I am pained to say that the Centre has not acceded
to the State’s genuine request for write off of U.T. period loans.
Provision is therefore, being made for payment of rs. 65.09 crores
in 1990-1991 to the Centre in respect of these loans, including Rs.
54.24 crores by way of arrears for 1988-1989 and 1989-1990. On the
other hand, we have received from the Centre arrear Plan assistance
of rs. 32.09 crores under the Mukherji Committee and a term loan of
Rs. 14 crores towards the opening deficit, apart from Rs. 3.75 crores
by way of additional share in small saving collections arising out
of U.T.I. investment.
10. In my last speech, I had proposed various measures
to raise additional resources of Rs. 6.63 crores in the current year.
Though there was a shortfall of about Rs. 3 crores in receipts from
those measures, mainly under salees tax, Land Revenue, Water, Road
Transport and Power charges, this was more than made up through impounding
of D.A. Payments to Government employees. Including the resources
available through impounding of D.A., the yield from additional resources
mobilization measures is expected to be over Rs. 8 crores in the current
year. Besides, in view of the difficult resource position, the State
Government enforced the various economy measures initiated earlier
more vigorously. It is noteworthy in this context that with a view
to conserving fuel, the Government has started observing Tuesday &
Saturday as Vehicle-less days. The various economy measures are estimated
to result in a saving of Rs. 5-6 crores in Non-Plan expenditures.
11. As per the Revised Estimates for 1990-1991, the
year is likely to close with a deficit of rs. 25.92 crores. Most of
this is because of the gap of rs. 20.08 crores left uncovered by the
Planning Commission in the Schemes of funding of the current year’s
Plan. We have approached the Government of India fdor staggering of
a part of the payments due in respect of U.T. period loans to cover
the deficit in 1990-1991. We hope to have a positive response on this.
However, for the moment, I am leaving this deficit uncovered.
BUDGET ESTIMATES FOR 1991-1992
12. As for the next year 1991-1992, I take a momentary
pleasure in presenting a Budget with a marginal current surplus of
Rs. 2.61 lakhs. The Budget Estimates for 1991-1992 place the Revenue
receipts at Rs. 349.16 crores and Revenue expenditures at Rs. 296.22
crores resulting in a surplus of Rs. 52.94 crores. The Public Account
also shows a surplus of RS. 9.78 crores. On the other hand, there
is a huge deficit of rs. 62.69 crores on Capital Account.
13. I just talked about our proposal for staggering
of U.T. loan repayment. This, if agreed to , would involve an additional
liability of rs. 7.6 crores and turn the Budget into a deficit one.
I may add that I have not provided for the possible impact on Budget
of the recommendations of the Pay Commission whose report may be expected
sometime next year. This is another factor which may add to the deficit.
14. The whole of the deficit in 1991-1992 would be
on non-Plan account. In so far Plan is concerned, the Planning Commission
has been persuaded to make available assistance to fund the entire
outlay of Rs. 150 crores in 1991-1992. This is no mean achievement
on the part of our Hon’ble Chief Minister. The State Government has
however, to find measures to bridge the gap on on-Plan account. It
this context, the need for continuing the rigorous discipline on the
non-Plan expenditures cannot be over emphasized. Further tightening
up is the need of the hour. What is required is to get the best out
of the given investments through improvement of efficiency in administration
and better husbanding of resources. The Government may also come up
in due course with some hard measures to mobilize additional resources.
15. May, I Sir, in the end express may thanks to
the Officers and Staff of various departments especially those in
the Finance Department and the Printing & Stationery Department
with whose unstinted and willing Co-operation it was possible for
me to accomplish the task of presenting the Budget to this august
House well in time ? May I also thank you, sir, and the Hon’ble Members
for bearing with me and request them for their co-operation in the
efforts to pull the State out of the current Financial impasse and
put in on a path of proggess and prosperity?
16. With these words, Sir, I now present the Revised
Estimates for 1990-1991 and the Budget Estimates for 1991-1992 for
the consideration and approval of this august House.
Thank you, Sir,