Caught in a dilemma of adhering to fiscal prudence and ensuring funds for promised pro-aam aadmi schemes, the UPA government is expected to go for a moderate hike in total gross budgetary support (GBS) by at least 15% for fiscal 2010-11, over current budgetary estimates.
Sources said finance ministry has promised the Planning Commission of at least 15% increases in planned expenditure putting the figure at Rs 3.73 lakh crore for next fiscal which will be lower compared to the current year.
For 2009-10, the increase in GBS at Rs 3.25 lakh crore was 17% over the revised estimates for 2008-09 and if compared to the original support estimated at the beginning of 2008-09 , the increase was a massive 34%.
With tight fiscal situation, the assurance from finance ministry comes after considering the spiralling inflation and the need for more funds for fulfilling UPAs promise in sectors like rural development, education and agriculture.
The UPA dispensation is also under pressure to ensure funds for new schemes, which have been announced but are yet to be implemented , like food for all and Right to Education.
The 15% increase in GBS the amount of assistance provided by the Centre for Plan schemes will be to the tune of Rs 2.76 lakh crore during 2010-11 . In Budget 2009-10 , the government had provided a budgetary support of Rs 2.40 lakh crore for Plan schemes of different ministries.
The agreement on GBS came after a meeting between finance minister Pranab Mukherjee and Planning Commission deputy chairman Montek Singh Ahluwalia on Monday.
Sources said the central ministries this year has been demanding 82% increase in GBS, while the Planning Commission insisted on 18-20 % increase.
Plan panel has been asked to focus on the flagship programmes NREGA, Bharat Nirman, mid-day meal scheme and National Rural Health Mission while approving annual plans of ministries for the next fiscal.
Ahluwalia had earlier said that departments asking for increased allocations.