Budget 2012: Business as usual

Friday, 2 December 2011 00:00 - - {{hitsCtrl.values.hits}}

BUDGET 2012 has been passed. The two-thirds majority in Parliament meant that few people would have been delusional enough to expect a different outcome, but there were several interesting points that emerged from the events that transpired in the 10 days since the Budget was presented.

Much of both the bouquets and brickbats for the Budget centred on emotive arguments laced liberally with rhetoric, with little or no foundation on facts, figures, or fiscal policy per se. An exception was the criticism of the proposed 10% public sector salary increase. It was initially highlighted as a boon, but subsequently subject to widespread criticism.

One objection was that the proposal did not constitute a 10% increase in the take home pay, as intimated but only on the basic salary and that too only as an allowance (which is non-pensionable). Another critical observation was that delays in implementing the increase (first promised in 2010, and now effective only from 2012), and intervening inflation, nullifies the promise to improve the lot of public sector workers.

The Rs. 100,000 grant to families of military personnel, upon the birth of a third child, was extended by this Budget to the Police force as well. “While left politicians critiqued the proposal on the basis that last year’s promise had not been kept, they failed to raise the more critical question on the implicit social engineering of targeting such benefits only to the families of security forces – and that too in contradiction of the general population policy of discouraging a third child, for example, by halving the maternity leave entitlement for the third as against the first two,” media research Verite observed in their analysis.

This underscores the lacklustre and seemingly empty debates carried out in Parliament. The vernacular media also did not pay much attention to the fact that the 3% devaluation of the rupee was a decision taken by the President as Minister of Finance rather than the Central Bank, setting the stage for a “cold war” between the monetary and fiscal policy organisations.

Not much attention was paid to the takeover of 37,000 hectares of land that defied the assurances given in the Underutilised Bill, with no adjustments adapted on this score.

Noteworthy moments were when Deputy Minister Sarana Gunewardana was slapped on the wrist for throwing a water bottle with a week’s suspension from Parliament and UNP MP Mohan Lal Grero crossed over to the Government – both of which are not pertinent to the real issues within the Budget.

War-time levels of military expenditure, which was critiqued in two previous post-war Budgets, has been somewhat normalised, drawing very little media attention. This was also the case with the repeated and costly deployment of a large cabinet of ministers, which has extended the neo-patrimonial structures of governance. The TNA was the only parliamentary group reported as questioning such deviations that have, over time, been taken for granted.

Overall, despite occasional flashes flavouring special interest groups, Budget 2012 was shown up to be uninspiring – the main signal being the Government’s intention to conduct its business as usual.