Congress' 5 poll freebies in Karnataka turning into fiscal nightmare? BJP bursts the bubble

The Congress registered a mammoth victory in the Karnataka assembly elections held in May this year by sweeping 135 seats out of 224. It defeated the previous BJP government led by Basavaraj Bommai that only won 66 seats. Apart from the BJP's failure to draw the voters into their camp, the five guarantees announced by the Congress party during the campaign expected to have played a big role in ousting the saffron party. 

While BJP has been vehemently critical of the guarantees, Congress calls them 'means for empowerment'. However, several reports suggest that the guarantees which include financial aid to educated but unemployed youth, free electricity, and free bus rides to women are estimated to put a burden of more than Rs 50000 crore each year.

The five guarantees announced by the Congress party 

Gruha Jyothi - 200 units of free electricity to every household

Gruha Lakshmi - Rs 2000 per month to every woman head of a family

Anna Bhagya - 5 kg rice to every member of BPL families each month

Yuva Nidhi - Rs 3000 to unemployed graduates and Rs 1500 to employed diploma holders

Shakti - Free travel for women in state-run buses. 

Budget allocated for the aforementioned schemes 

Gruha Jytohi- Rs 9,000 crore

Gruha Lakshmi - Rs 17,500 crore

Anna Bhagya - Rs 10,265 crore

Yuva Nidhi - no budget outlined for this scheme

Shakti - Rs 2,800 crore

Will the guarantees by Congress last full term?

In his 14th budget presentation in July, Karnataka CM Siddaramaiah said that his government will spend Rs 52,000 crore each year to fulfill the guarantees. Also the finance minister of Karnataka, the CM said that the schemes will benefit 1.3 crore families in the state. 

Siddaramaiah presented a state budget worth Rs 3.27 lakh crore. While it is slightly higher than the one presented by the BJP government (Rs 3.09 lakh crore), cutting funds in a few areas to channel them for the schemes could hamper growth in other sectors.

In an exclusive conversation with Republic TV, Ramalinga Reddy, Transport Minister of Karnataka said that the Shakti scheme has been a success so far and asserted that the funding for the said guarantees is not a problem. When asked how the government will keep funding these schemes without putting a burden on the economy, Reddy said, "We have to do it. Otherwise the central government cannot help. They are not helping."

He said that the Centre receives about Rs 4.5 lakh crore in taxes but the Karnataka government is receiving just a small part of it. " Rs 4,50,000 crore taxes are going to the Central government including GST and all other taxes. What we are getting back, just Rs 35,000 crore plus Rs 15,000 crore in housing and other schemes," the Minister said. 

He also stated that the Centre has maintained a step motherly attitude toward the Karnataka government led by an opposition party. "Not only for Karnataka, for all other states also including the BJP's," Reddy said about the alleged discrimination. 

He also talked about the Shakti scheme and said that the government is utilising the funds for purchasing new buses and the recruitment of staff. "We have to recruit staff and purchase new buses. We have to extend last-mile connectivity. Along all, this is 100% a success. Other (schemes) are also a success," the Minister claimed. 

BJP's rebuttal on success claims by Congress

In contrast to Reddy's claim, BJP says that the Congress party is failing to deliver on its promises made before the assembly elections. Republic also spoke to BJP MLC Chaluvadi Narayanaswamy who said that the Congress party made the guarantees only to win elections. He also believes that the schemes will go defunct soon enough, probably after the Lok Sabha elections next year.

"In the four months itself, they are struggling to do it. There is no guarantee after the election," Narayanaswamy said. He also cited the example of Punjab where the state's debt has skyrocketed and crossed Rs 3.12 lakh crore. 

"You can see in Punjab also. They are also in trouble. Whichever state has given these guarantees, they have to prepare early itself. But for the sake of votes, they gave guarantees without any planning. So their struggling means it won't last," the BJP leader further said.

He further alleged that the Siddaramaiah government is struggling to provide 5 kg rice as promised, even after the number was reduced from 10 kg. Recently, the Karnataka government had a faceoff with the Centre as the latter refused to supply rice to the state for the Anna Bhagya scheme citing shortage of rice.

When asked if the schemes will last five years, Kumaraswamy replied, "I don't think so. Now itself they are struggling means after the parliamentary election they are going to stop this. They are not able to give 5 kg rice now. Earlier they announced 10 kg, now they even 5 kg they could not arrange.”

He further claimed that the people of Karnataka have only received messages about Rs 2000 for Gruha Lakshmi but not the money. According to the BJP leader, the Congress party should have focused on the elections without making any promises and, "whatever they wanted to give the poorest of the society, they could have given later," he said.