December 21, 2017
Saugata Roy speaks on Supplementary Demands for Grants – Second Batch for 2017-18
FULL TRANSCRIPT
Sir, I rise to speak on the Supplementary Demand for Grants, brought under Article 115 of the Constitution. There are 76 grants and 3 appropriations and it is part of the constitutional duties of the Government to pass any excess expenditure.
Out of this total supplementary grants of about Rs 63,000 crore, Rs 32,000 crore will be met in reduction of Government expenditure. So, the actual outgo is Rs 33,000 crore. The grants will be mainly in certain areas: Rs 15,000 crore and Rs 900 crore towards roads and highways, Rs 20,000 crore to clear liabilities towards urea fert subsidy, Rs 8394 crore to NREGA, Rs 5905 crore for 7th Pay Commision, farm sector will get Rs 3745 crore, railways will get Rs 2382 crore, disinvestment of Air India will get Rs 10 lakh and Rs 960 crore towards establishment related expenditure including payment of advanced user charges to GST network and information technology.
So this is roughly what the Government is seeking. There are only two problems with this grant. One is that the Government has stated the deficit at 3.2%. But with this expenditure 96% of this deficit has already been met, so the Government will not be able to maintain the deficit within 3.2%.
The other criticism of this grant is the Government spending quality falls after brief improvement. Which means the revenue expenditure largely of the routined nature like interest payment mentions an upkeep of assets of capital expenditure is not rising at first as a result of which the economy is not improving to the extent possible.
Sir, having said that, let me say that it is a very bad day for Mr Jaitley. I saw his interview on television after all the accused in the 2G Scam were acquitted. This was the basis on which the BJP and Mr Jaitley and Mr Modi had built their case about corruption against the UPA Government and now it seem that the whole edifice has collapsed.
Mr Jaitley tried to give a face-saving statement but face will not be saved. And I want to see the face of Vinod Rai who had said that 1,76,000 crore was presumptively lost in the scam. Vinod Rai is now getting a fat salary from the Board of Control for Cricket in India. These so called CAGs and IAS officers, they think they are bigger than God but he should come before the court and be investigated himself.
So, Mr Jaitley’s premise has collapsed. And may I say, with all deference to Mr Jaitley, though personally he is an affable man, he has been a total failure as a Finance Minister. I take up four decisions of his. Number one, demonetisation; number two, introducing GST in a hurry; number three, linking Aadhaar to mobile numbers, bank accounts and all social security schemes; and number four, Financial Resolution and Deposit Insurance (FRDI). These four are the four most anti-people measures taken since independence.
And what are Mr Jaitley’s great policies? What has happened to the economy? The Economic Advisory Council to the PM has conceded that there has been a slowdown of growth rate. A marginal increase from 5.7% to 6.3%. This is a result of demonetisation and hurried implementation of GST.
The crisis in the MSME sector, which contributes about 40% to GDP and accounts for about 70% of employment, should not be brushed under the carpet. Inflation, which had gone away, is again rising again due to inflationary impact of the GST. Annual rate of inflation, based on monthly WPI, stood at 3.93% (provisional) for the month of November, 2017, compared to 1.8% during the corresponding period in 2015. This is also visible in the prices of vegetables and other things in the market.
Already, the government has cut the expenditure drastically on social sector schemes – ICDS, Sarva Siksha Abhiyan, MGNREGA. They said that they have transferred more money to the states, from 32% to 42% , but the fact remains that the poor people have suffered due to this crisis. These people are jumping with joy because, Moody’s, some American company, has made a presumptive assessment saying that the economy looks slightly better. But what does the IMF, their Guru, say? That the economy needs to be looked into and it is not doing well.
Sir, there is a total crisis in the agrarian field. Farmers’ unrests have rocked the states of Maharashtra and Madhya Pradesh. Farmers were shot dead in police firing in Mandsaur, Madhya Pradesh in 2017. So, crisis is all around: agrarian crisis, farmers not getting prices, crisis in the MSME sector, job losses.
And what is the condition of the banks? The total NPA of banks add up to nearly Rs 8 lakh crore. We’re reaching a situation where our banking system is nearing collapse, the government is enacting one law after another, but the NPAs are not coming down. In 2012-13 it was 1,644 billion, 2015-16 it increased to 5,400 billion, and now, it has increased to 6,120 billion. The economy is in a crisis.
Sir, the growth rate as I pointed out is coming down. The honourable members on the treasury benches, they say it does not matter. Even if the economy is in a difficult condition, at the time of election, they will raise the slogan of Ram Janmambhoomi or Triple Talaq, or such communal issues, and try to get through in the election. There is no substitute for solid economy, and that is lacking in the present finance minister’s discourse.
Even investment sentiment is not favourable . The improvement of India’s ranking on the ease of doing business has been marginal. We are still stationed at the rank of 130 in the whole world. In a 12 month period, from Q4 of 2015-16 to Q4 of 2016-17 gross capital formation at constant prices fell from 30.8 % to 28.5 %. So, as you can see the economy is in a total crisis.
What is the government resorting to ? The government is resorting to anti-people steps. What is the worst anti-people step? Sir, you will be concerned. Everyday I am receiving at least 20 calls from people on two issues. One is on Aadhaar; they are saying they don’t have one and till the time they don’t link their bank account to the Aadhaar they won’t be able to take out money.
And the second thing the people are complaining about is the new FRDI Bill. In this House one Bill called Financial Resolution and Deposit Insurance (FRDI) came and it was referred to the Joint Committee of both Houses of the Parliament. It says there will be a bailing clause in case financial institution is collapsing. The government can interfere and leave a margin of 1 lakh. They can take money from your deposit account and convert it into bonds. This is creating uncertainty in the minds of depositors all over the country. You may say it has gone to Joint Committee but I want the minister to withdraw the Bill. This the fear in the minds of the depositors and the ordinary people of the country.
Our Chief Minister Mamata Banerjee has written to the Finance Minister to withdraw it immediately as there is uncertainty. If people do not find it safe to keep money in the public sector banks then where will we keep our money safely? This is the question that is being asked. They brought this Bill under the pressure of IMS, World Bank, Financial Stability Board – all western powers. The bank union and officers have protested.
Today the whole excise trade is in jitters. There is a decline in manufacturing, textile sector faces tremendous decline. The country’s economy is going to shambles. Sir, you know how Tamil Nadu fishermen have suffered due to Ockhi; you know how the central government is depriving the State of the due shares. Let us all put our heads together and ask this Government to wake up from this financial crisis.
I do not know how all these economic decisions are taken; why GST was implemented in a hurry, even before the GST the network was fully in place. Why did you suddenly decide to link Aadhaar to everything. Aadhaar was scheme by the UPA Government; why did you become such a lover of Aadhaar that you wanted to link everything to Aadhaar? Why do you not give sufficient money to the anti- poverty programmes?
With these words, I say to the government, this is a wakeup call. The government must rise to the occasion nd fulfill its responsibilities., Withdraw this linkage to Aadhaar; withdraw the FRDI Bill. Apologise to the people of this country for the tremendous suffering caused to them due to demonetisation; more than 150 people died.
Sir, recently YV Reddy – who was the Governor of Reserve Bank of India – said in a statement that because of demonetisation and hurried implementation of GST, the country’s economy has suffered such a loss that it will not recover before two years. Mr Jaitley and Mr Modi owe it to the country to explain why they brought this hardship to the people of this country.
Saugata Roy seeks clarification from the Finance Minister on FRDI Bill (7:30 PM)
Chief Minister of Bengal, Mamata Banerjee has written to the Finance Minister regarding the apprehensions over the Financial Resolution and Deposit Insurance (FRDI) Bill.
I know that the Bill has been referred to a Joint Committee, and I’m part of it. But there is widespread fear among the people, ordinary depositors, about a bail-in clause, which ultimately allows the government to put into its hands the depositor’s money. If you see social media, people are questioning that.
All I want to ask the Finance Minister is that would he clarify this matter to allay the fear amongst the minds of the people that the deposits would not be played with, that they are safe, because of the bail-in provision?
