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SHRI RUPCHAND PAL (HOOGLY): Mr. Chairman, Sir, I shall confine myself to some of the items in the Supplementary Demands for Grants and I will not go beyond that. Only when necessary, to illustrate my point, I shall refer to the original Budget provision.

The hon. Minister got another opportunity to correct the fiscal distortions that had been taking place and which has been a matter of great concern to the whole nation. The interest burden has gone beyond control. As has been referred to by my hon. colleague here on the other side, it is going to such an extent that if you take into account the fiscal deficits of all the State Governments put together it is to the tune of about ten per cent of the G.D.P. But the hon. Minister of Finance has not cared to correct the fiscal distortions that are taking place, although we have been assured about an Expenditure Commission.

On one occasion I have heard that there have been some suggestions about resorting to article 292 of the Constitution and have some gap on the borrowing. If adequate and timely steps are not taken for fiscal correction, I think whatever is being proposed now or whatever is going to be proposed in the next Budget after two months, it will all be a meaningless exercise.

I am first coming to the items of the Supplementary Demands for Grants. There are five items which are there in the Supplementary Demands for Grants. The first is Defence. This is, perhaps, the largest Supplementary Demand made in recent years in respect of Defence. Of course, the near-war situation, or whatever you call it, in Kargil was there which is one of the basic causes which was unforeseen.

I may agree on it, but pension, dearness allowance, and payment of dues or arrears have all been jumbled up together. Could the pension amount not be foreseen?

Sir, I have a point to make on the Supplementary Demands for Grants itself. Only new expenses or unforeseen expenses can be taken into account in the Supplementary Demands for Grants. For example, let us take up Defence. This is the latest report of C&AG; of course, this is a civil one. In this, there is a reference to Defence Services at page 106. According to it, the voted original Grant was Rs. 36,643.82 crore, the Supplementary Grant was Rs. 1,268.37 crore, and the unspent provision was Rs. 1,460.21 crore. It means that when the Supplementary Demands for Grants were placed before the House, they had already about Rs. 200 crore unspent or unutilised money and yet they made such a Demand. This is only one illustration. I have so many such illustrations.

Now, I am making a reference to the Thirteenth Report of the PAC (1996-97) relating to the Ministry of Defence. I am just quoting the relevant part only. It says:

"The Committee's examination has, however, revealed that the mechanism of obtaining Supplementary funds was used by the MoD during a particular year in a rather casual and routine manner, without carefully conducting a proper assessment of the expenditure incurred or likely to be incurred by them against the funds already made available to them. The net result was that Supplementary funds of the order of Rs. 157.95 crore obtained under voted portions of the two Grants relating to Defence proved unnecessary as the final savings of Rs. 227.88 crore, in these cases, far exceeded the Supplementary allocations."

Then, I am reading the last part. It says:

"What has disturbed the Committee more is the fact that MoD had obtained Supplementary funds even for those segments in four Grants where original provisions were still more than adequate, despite withdrawal of funds through reappropriations therefrom."

I mean, Sir, the Supplementary Demands for Grants have become a ritual. The budgetary exercise has become casual and there is lack of seriousness in it. They do not care to look into it. I can quote any number of observations made by very important Committees, particularly the PAC and the C&AG. We are going to pass these Supplementary Demands for Grants. But my plea is, the Chair has a responsibility here and I would seek your protection, henceforth the Appropriation Accounts must be submitted to Parliament before the Supplementary Demands for Grants are presented. I am making a reference to the Defence Services Appropriation Accounts. It has not been submitted for the previous year. When it is submitted after the passing of the Supplementary Demands for Grants, it becomes a useless or a futile exercise. Parliament cannot be taken for a ride; Parliament has a role, that is, to exercise its control over the executive. We would be failing miserably in performing that responsibility, if we are deprived of such important information which can only come through the Appropriation Accounts.

We pass the Supplementary Demands for Grants as casually as they are being presented, without any proper assessment of the needs and the quantum of funds that are lying unutilized. On several occasions, the funds could not be utilised even at the end of the financial year. This is my first submission.

Secondly, second item has been mentioned as, Transfer to States -ways and means. Could it not be foreseen? Could the Government not foresee it? Now, they are saying there is Rs. 3000 crore for transfer to States. This, of course, includes both the States as well as the Union Territories. Now, I have a question to ask. The Tenth Finance Commission has categorically pointed out about devolution and about transfer of funds to the States. There should be a transfer to the extent of 29 per cent of the total revenues. What has happened to that?

SHRI TRILOCHAN KANUNGO (JAGATSINGHPUR): It has been accepted but not yet been implemented.

SHRI RUPCHAND PAL : Yes. Day before yesterday we heard that the Chief Minister of Andhra Pradesh has submitted a Memorandum. Many States, for that matter, have been doing it. Just yesterday I was talking to Shri Farooq Abdullah, the hon. Chief Minister of Jammu & Kashmir. All States, irrespective of the party in power, are in such a bad financial position that they are even unable to pay salaries to their employees.

MR. CHAIRMAN : Please conclude now.

SHRI RUPCHAND PAL : Sir, I would be making only brief and relevant points.

Sir, the State Government of Madhya Pradesh have failed to pay salaries to the college teachers of that State for several months now. Unless restructuring of the financial relation between the Centre and the States is taken up seriously, there would be friction between the Centre and the States thereby resulting in further deterioration in the financial condition of the States, which might finally awaken the Centre as well.

SHRI TRILOCHAN KANUNGO : Already it is causing friction between the Centre and the States.

SHRI RUPCHAND PAL : Sir, the Centre can borrow recklessly and desperately without any limit. They can go to any extent to borrow. The Chief Minister of Andhra Pradesh, the Telugu Desam Party is a partner of this ruling combine, has demanded that the State should be given the right to borrow without reference to the Central Government. This is a point which should be taken care of.

Sir, I am happy that Rs. 850 has been allotted as Central Assistance to the State of Jammu & Kashmir. But there is an apprehension in many quarters in respect of many States, I am not talking about the State of Jammu & Kashmir alone, that the money allocated to the States should be utilised for the purpose for which it has been allocated to them. The State of Jammu & Kashmir needs reconstruction of primary and secondary schools, primary health centres, hospitals, roads etc. which have been ravaged by the terrorists on different occasions. I am happy that Central Assistance has been provided to the State of Jammu & Kashmir.

Sir, a sum of Rs. 1,353 has been allocated for the construction of the National Highways. Out of that amount, Rs. 547 crore has been allocated for maintenance of the roads.

MR. CHAIRMAN: Please conclude now.

SHRI RUPCHAND PAL : Sir, I have a point to make and I hope, we all shall agree with it. During the Budget, Re. 1/- per litre was taken as cess. Fifty per cent of the income from the Excise and Customs was to be given for the road fund. What has happened to that? How much amount of money was realised on that and how is that fund being transferred for road development?

Sir, I come to the next point. There are five items - defence, civilian pension, transfer to States, allocations and loans. The Central Relief Fund and the National Calamity Relief Fund should be taken resort to in cases of rarest and severest natural calamities. You know, Sir, that nothing comparable to the recent super cyclone in Orissa has occurred in the last two hundred years. I do not know how many people died. However, no provision has been made for extra assistance to Orissa, not only to Orissa but also to West Bengal which was seriously affected by heavy downpour and flood. The Government of West Bengal demanded an amount of Rs.721 crore. After the Central team visited the State, it had recommended a meagre Rs.135 crore. Even that has not been given. The same is the case with Andhra Pradesh which was afflicted by floods. The same is the case with Bihar.

When the Government comes to the House here to present the Supplementary Demands for Grants, it should take care of the demands of the States, particularly those States which are afflicted by natural calamities.

Sir, Parliament is supreme and it cannot be treated casually. On many occasions in the past, the budget exercise was undertaken by the Government in such a manner that it did not take into account the obvious expenditure that they may have to incur in the year. Sometimes, the Government comes to the House with Supplementary Demands for Grants very casually even when the original budget is left unspent. On many occasions in the past I had made a mention of these things.

Finally, I would once again request the hon. Finance Minister to make some provision for the States of Orissa, West Bengal, Andhra Pradesh, Bihar and the other States which have been the victims of natural calamities.

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