Planning Commission focuses on a more inclusive 12th Plan…..Sangeeta Singh, Rahul Chandran & Aman Malik
The Plan panel has identified 12 critical areas, with social sector, infrastructure being key priorities
The government’s focus on food, oil and fertilizer subsidies may not lead to a significant increase in gross budgetary support (GBS) in the five years to March 2017, compared with the preceding Five-year Plan, the Planning Commission said.
India’s apex planning body has suggested that the government raise more money from the private sector and reduce dependence on centrally-sponsored schemes by involving panchayati raj institutions to better facilitate social sector spending.
“With a focus on food, fertilizer and petroleum subsidies, we are not expecting a big jump in the gross budgetary support in the 12th Plan as compared to the 11th Plan,” said Pronab Sen, principal adviser, Planning Commission. “The Planning Commission is thus suggesting raising more money from the private sector through public-private participation.”
GBS is the funding the Union government makes towards various sectors through budgetary provisions every year. The finance ministry makes the allocations. The Planning Commission, after consulting respective ministries, seeks such funding, which are typically higher than what is allocated.
The Plan panel also wants deeper participation of local government agencies such as the PRIs and district planning boards to achieve better results from the centrally-sponsored schemes for social sectors, Sen said.
Social sector programmes funded by the Centre and executed by the states include the rural job-guarantee programme, the universal education initiative and the national rural health mission.
The Planning Commission has identified 12 critical areas around which the 12th Plan (2012-2017) will revolve, the social sector and infrastructure being key priorities.
The Plan panel, in the past couple of months, held five regional consultations, one each in Delhi, Patna, Mumbai, Bangalore and Guwahati.
“For devolution of power the PRIs, as also civil society organizations, suggested enforcement of legal decentralization and participation of all sections, define their financial allocation and role in local level planning besides mandatory social audit of all social sectors programmes,” said a second Planning Commission official, who did not want to be identified.
On railways, the focus will be on partnering with private firms, as the government is struggling to meet the state-owned body’s expansion plans on paucity of internal accruals.
The railway ministry is pushing for a total Plan outlay of Rs.7-8 trillion, with Rs.2 trillion earmarked for partnership projects, said a railway official with direct knowledge of the matter.
“Initially, the Planning Commission had suggested an abysmally low figure of Rs.3.4 trillion for the entire plan period,” he said, requesting anonymity. “We are lobbying with them to raise it substantially.” This official added that the railways is likely to submit its final proposal to the Planning Commission by 12 August.
It was too early to speculate on the actual outlay the government would provide towards such public-private partnership (PPP) projects, said a third Planning Commission official, who declined to be named.
“The figure of Rs.7-8 trillion seems ambitious,” said N.R. Bhanumurthy a professor at the National Institute of Public Finance and Policy. “There is, however, a realization that the railways needs to move ahead with reforms, so the outlay could certainly go up.”
“Moreover, the Planning Commission is likely to build a hedging mechanism into the system, so that investments into risky projects are safeguarded,” he added.
The 11th Plan, which ends 31 March, had envisaged spending over three-fourths the projected Rs.14.21 trillion in the draft plan on priority sectors. In the 10th Plan, it was 55%, while total spending was Rs.8.1 trillion. The projections for the 12th Plan are yet to be announced.