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GOVERNMENT of ANDHRA PRADESH
FINANCE DEPARTMENT
Previous Budget Speeches

FINANCE MINISTER'S BUDGET SPEECH 1969-70

 

Speech of

Sri K. Brahmananda Reddi

Hon'ble Chief Minister while Presenting

The Budget for 1969-70

To The Andhra Pradesh Legislative Assembly

on 3rd March 1969.

 

 
 
Introduction

Sir,

I rise to present the Budget of Andhra Pradesh for the year 1969-70; I am however, for the present seeking "Vote on Account" for period of six months, i.e., from 1st April 1969 to the end of September 1969. I am compelled to follow this course for the following reasons:-

a. Honourable Members are aware that under the Interim Award of the Fifth Finance Commission, the State Government would be getting for the financial year 1969-70 an additional amount of Rs. 7.55 crores from the Government of India by way of its share of taxes and duties and grants under Article 275 (1) of the Constitution. This does not even marginally cover the revenue gap of the State. Subsequently in its final Memorandum presented to the Fifth Finance Commission and during the recent discussions it held with the Commission in the last week of January 1969, the State Government urged for a larger devolution of taxes and duties and increase of grant-in –aid to cover the minimum requirements of the State Government including the committed expenditure in respect of the last three years’ Annual Plans. The Commission is expected to submit its final Report to the President of India by the end of July 1969. It is earnestly hoped that under the final Award of the Commission the entire revenue gap of the State will be fully covered. A final estimate of our receipts could be attempted only on the basis of the final Award of the Commission.

(b) Our draft Fourth Five-Year Plan envisages a total outlay of Rs. 650 crores. The Central assistance for the State Plan has yet to be settled as certain issues regarding the allocation of outlays as between the Central sector and State sector remain unresolved. The burden of repayment of loans to the Centre by this State is specially onerous and unless the question of re-scheduling their repayment is settled, the State’s resources for the plan cannot be assessed fully. The exact size of our Fourth Plan is therefore yet to be determined. In fact even our Annual plan of 1969-70 is still in determinate. Only after the above issues are settled would it be possible to estimate the Plan expenditure for 1969-70.

(c) Honourable Members are aware that at the All Party Conference held on 19th January 1969, it was agreed that the Telangana surpluses will be fully utilised for the development of Telangana surpluses which have accrued since the formation of the State are being worked out by a representative of the Auditor-General. Only after his findings are available would it be possible to determine the special provision which will have to be made in this regard and work out region-wise break up of receipts and expenditure.

For the reasons explained above, Honourable Members will appreciate, I am sure, that the only expedient course we could follow would be to seek a ‘Vote on Account’ for six months.

Accounts for 1967-68

The Revenue Receipts in 1967-68 amounted to Rs. 184.27 crores while expenditure on Revenue Account was Rs. 189.81 crores. The deficit was Rs. 5.54 crores as against the anticipated deficit of Rs. 2.58 crores in the Revised Estimates 1967-68. The deterioration is mainly due to the fall in land revenue receipts.

Revised Estimates 1968-69

As against the original estimates of Rs. 199 crores the Revenue Receipts have now risen to Rs. 203.52 crores.

Revenue Expenditure has also risen from the original figure of Rs. 204.67 crores to Rs. 239.67 crores.

The Budget for 1968-69 provided for a total capital outlay of Rs. 33.68 crores as against which the Revised Estimates has been fixed at Rs. 38.87 crores. This has become necessary in order to meet expenditure on schemes become necessary in order to meet expenditure on schemes such as commutation of pensions, payments to Jagirdars, irrigation, electricity, buildings, industrial development, etc.

After taking into account the above transactions and those under Loans and Advances, Public Debt and Deposits, the year is expected to close with a cash balance of minus Rs. 45.94 crores.

Budget Estimates 1969-70

The Budget Estimates for 1969-70 provide for a total revenue of Rs. 279.91 crores and Revenue Expenditure of Rs. 288.47 crores. We are assuming central assistance of Rs. 64.58 crores for the next year’s Plan. Out of this, the central grant is expected to be Rs. 5.13 crores, while the outlay on Revenue account is likely to be Rs. 13.66 crores. The net deficit on Revenue account will therefore be Rs. 8.5 crores assuming that the gap between non-Plan receipts and expenditure is fully covered by grants-in-aid under the Award of the Fifth Finance Commission.

The total capital outlay is estimated at Rs. 40.19 crores for 1969-70 as against the Revised Estimates of Rs. 38.87 crores and Budget Estimates of Rs. 33.68 crores for the current year. A sum of Rs. 18.11 crores is provided for disbursements under Loans and Advances.

The year 1968-69 opened with a cash balance of Rs. 4.3 crores and is expected to close with a minus cash balance of Rs. 45.94 crores. On the basis of Revenue and Expenditure, Capital outlay, Loans and Advances, Debt, Deposits, etc., the year 1969-70 is expected to close with a minus cash balance of Rs. 45.94 crores.

Plan Outlay

Annual Plan 1968-69—In 1968-69, as against an outlay of Rs. 72.13 crores in the Plan, Central assistance of Rs. 53 crores was assumed. The Planning Commission had, however, approved an outlay of only Rs. 56.05 crores with a central assistance of Rs. 37.3 crores. A Plan of this size would have been totally inadequate to meet even the spill-over commitments. We therefore protested against the reduction in Central assistance and requested the Government of India for increasing the assistance , if not to the level of 1967-68, at least to Rs. 53 crores assumed in the Budget.

Subsequently, the Government of India have intimated an additional assistance of Rs. 5.5 crores for Nagarjunasagar Project as was done in the case of certain other major projects in the country. With this and with ce5rtain relief given by the Government of India in the repayment of ad-hoc loans, the Plan has been revised to Rs. 73 crores.

Annual Plan 1969-79—The difficulties in finalisation of the size of the Annual Plan of 1969-70 have already been explained. Our resources position will, however, continue to be difficult, particularly on account of the repayment of ad-hoc loans to the Government of India. We have therefore been obliged to restrict the Plan outlay to Rs. 84.87 crores being the minimum required to meet the spill-over commitments, specially, under Power and Irrigation, although having regard to the size of the Draft Fourth Plan, it should be larger.

New Welfare and Other Measures in the Budget 1969-70

Our financial position continues to be acute. Yet it is imperative that we have to undertake certain essential welfare measures. The following special provisions are accordingly made:-

   
Rs. lakhs
I
Uplift of Harijans and Girijans in the Gandhi Centenary year 100
100
II
Provision for additional 6000 Old Age Pension cases (over and above the existing 60000 cases annually)
10
III
Compensation to Municipalities for loss on account of proposals for the abolition of cycle tax, profession tax in respect of persons in certain income groups, and abolition of license fees for owner-driven rickshaws
30
IV
Grants to the 3 Universities in the State as follows:-
Osmania University 37
Andhra University 20
SriVenkateshwara University 11
68
V
For replacement of condemned police vehicles
15
VI
Extra provision for strengthening the Police Force in this State 
15
VII
Provision for improvement of amenities in the twin cities of Hyderabad and Secunderabad
40
VIII
Provision for improvement of amenities in Visakhapatnam Town 
10
IX
Extra provisions for diet and medicine charges in hospitals and dispensaries at Warangal, Kakinada, Tirupathi etc. and for strengthening rural dispensaries
  24



Conclusion

I shall present the final budget before September 1969. In the meantime, the final Award of the Finance Commission will have been pronounced; the Fourth Five-Year Plan finalised and the Telangana surpluses worked out. In the light of these and upon due assessment of the economic situation in our State, the final budget proposals will be formulated. I shall then take the opportunity of reviewing our more important programmes and policies.

 
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