Why India must scrap the whole budget presentation circus

Last Updated: Wed, Jan 25, 2017 16:54 hrs
India's FM Jaitley poses as he leaves his office to present the 2015/16 federal budget in New Delhi

Indian budgets costs several crores of rupees - possibly hundreds of crores - to present India's budget the way it is done.

Governments in New Delhi do not for a moment think of this cost.

The only possible way to wring the truth out of them is by relentless queries filed under the RTI. Only then will we know precisely how much of our tax payments go into the budget ritual.

For instance, it costs us more than Rs 100 crore a year to maintain Rashtrapati Bhavan in New Delhi. This is an absurd waste of public money.

The structure could serve India better as a modern hospital but it is used as a home for one person and his [or her] entourage.

Likewise, India's budget exercise is a huge financial liability.

Security is vastly increased to maintain secrecy in North Block and Yojana Bhavan – where the Planning Commission operates from.

Both begin to go into shutdown three months ahead of the budget usually. It reaches extreme proportions by the budget month when senior finance ministry staff can't even go home.

They are monitored by the Intelligence Bureau [IB], the Delhi Police, and scores of commandos reporting to other security agencies.

Rail Bhavan, where the ministry of railways is headquartered, used to follow this bizarre practice at high cost.

The railways are broke; they have been so for a few years. But they had to spend on budget security till 2016.

Separate passes need to be printed ahead of every budget, which are apart from the handful already needed to enter the ministries. These involve separate expenses on paper, stationery, staff, and their communication and time.

They use colossal amounts of paper preparing the budget because Internet access is not permitted.

Close to a hundred people are chosen every year to oversee the tedious editorial work of the budget.

These people have to live in North Block until the budget is presented. The costs of running their lives are met from our taxes.

These people are called volunteers although they are more like guests of the state.

Their food comes from outside for three weeks. All of them are allowed to receive phone calls on a common landline. These calls can only be received when there's an IB sleuth listening in.

Their job: to proofread the budget proposals, translate them into Hindi and print them using two machines in the North Block basement.

Officials too begin to cost more during the budget exercise.

Their phone calls [both on landlines and mobile phones] need to be monitored and this means more IB sleuths.

There are scores of pages of the budget document that are read and reread. All of them are destroyed at each stage.

This means enormous amounts of paper because they don't use digital options.

Food for the officials too comes from outside. This isn't as simple as it seems. There are hundreds of officials and a whole team of extra staff has to take orders, tag them and deliver them every day.

All of this, again, overseen by security agencies.

Senior officials too can't go home during the budget exercise.

And since they are senior and far more important than volunteers, their living expenses are far more than those of the basement volunteers.

All this to continue with practices from the Raj.

The British have long gone. The United Kingdom is struggling with its economy just as much as India is.

India has barely anything in common with the UK. But, it continues with the budget presentation like we are still in the 1930s.

Until the year 2000, even the time of presenting the Budget was London-centric. New Delhi used to present the budget at 5pm IST because it would be around noon in the UK, when the stock market comes alive and parliament in session.

The NDA changed this to noon IST. It was an important change but nowhere near enough.

India is still an extension of the UK, at least in the budget rituals.

The practice of presenting a separate rail budget too was from the 1920s. There were complaints then that the railways was not getting enough funds and attention.

The British administration chose to have a separate rail budget because the railways was critical in British India.

As the government has finally realised, there's nothing to warrant the huge annual expense of a separate rail budget.

It made no sense to waste money on these rituals when India desperately needs it to be used elsewhere.

In any case, nobody needs to tinker with broad policy every year. Rail policy should be for five years and shared with the people of India at the beginning of a government's term.

Changes in fares and train timetables are routine affairs. They can be announced through a statement or a press conference at best.

Similar correction is required in the general budget.

Broad fiscal policy doesn't need annual tinkering. The policy may be outlined at the beginning of a government's term for the next five years.

Tax proposals should not be part of the annual budget exercise. They are probably the single biggest reason for the unnecessary secrecy, which comes at tremendous financial cost.

Indian budgets become secretive because they contain tax proposals. Naturally, anyone who knows how tax rates are to change can make a fortune by buying or selling goods and services before the tax rates change.

These days, they can make millions by merely selling the information. Therefore, the need for secrecy and the huge costs the exercise entails.

Delinking tax proposals from the budget exercise would free huge sums of money that may be used where needed.

The budget is essentially an accounting exercise. It can't be so expensive.

It matters little how the budget is presented. It's time we realised this.

The annual budget ritual largely provides political parties and the television media an occasion to grab eyeballs.

That is not the purpose of a budget.

The people of India need to shape the budget as much as political parties. The Modi sarkar could begin by ending the financial extravagance of the budget exercise.

In the US, the president, the house of representatives and the senate have their own budget proposals.

All of them are open to public scrutiny before policy is framed.

China and the UK like to keep it secret. India, though, cannot afford the ridiculous costs of budget secrecy.

Vijay Simha is an independent journalist and sobriety campaigner based out of New Delhi.

Vijay blogs here and may be contacted at vijsimha@gmail.com.