“Can’t be business as usual” , a phrase used by the PrimeMinister, to describe Indo-Pak relations after the beheading of our martyredsoldiers, has entered into the lexicon of international diplomacy, for whateverit’s worth. In another place and in another context, it should enter into thelexicon of Goa’s financial management, which requires trapeze artists ofimmense repute, after the hit the government has received post the mining ban.
The capital outflow (expenses) of the government in December2012 and projected expenses from January to March add up to Rs 2171 crores(exact figure Rs 2171.02 crores), while the revenue expected to be earned forthe same period is Rs 1880 crores (exact Rs 1879.35 crores). The expenses showa steady rise from 463 crores in December to a progressively increasing 535crores, 578 crores and 593 crores in the last three months of this FY. Theexpected revenues will try and play catch up and fail. In fact there isactually a drop in expected revenue in February to 412 crores from the Januaryprojection of 431 crores.
While the Chief Minister Manohar Parrikar led government isconfident of bridging the Rs 300 crore gap between confirmed expenses andprojected revenues in the three remaining months of FY 2012-13, throughborrowings, it needs to keep these borrowings to a minimum and only duringextreme exigencies. The government has already borrowed 720 crores this year(including private borrowings). Another 300 odd crores would take this to aboutRs 1100 crores. While this compares favourably with the Rs 1200 crore borrowingin FY 11-12, it gets very watertight because last year there was mining relatedrevenue liquidity to fund loan repayments. Adding to this will be a dent inrevenue from commercial taxes, which is projected at around 2200 crores asagainst projections of Rs 2500 crores.
A slowdown in the pharma, food and drink and consumer goodsbusinesses in the mining belt has led to the dent in commercial taxes revenue.Currently the biggest hole in the CM’s pocket is caused by the 53,000government work force (including teachers who receive salaries in grant“in“aidschools), whose salary bill is Rs 115 crores a month. Goa has one of thehighest ratio of government employees to its adult population in the countryand currently there is very little being done in terms of workforcerationalisation. Secondly, the loanrepayment bill is about Rs 116 crores a month.
While the Chief Minister is confident, the people of Goaneed to know that the figures don’t add up. Some smart management might balancethe books, but with mining revenues drying up, book balancing through borrowinghas a limited period of play. Additional revenue from improving recoveries andadditional taxes like those on entry of vehicles may keep Goa on oxygen, but itneeds big ticket investments and revenue inputs for the engine of the state,which refuses to slash its work force, to run.
