AIADMK and DMK's shower of freebies; experts flag financial implications

Loaded with doles and freebies to woo the electorate ahead of the April 6 Assembly polls in Tamil Nadu, archrivals DMK and AIADMK's populist agenda driven election manifesto are also being debated for the financial implications on a state already burdened with high debts.

With late DMK chief M Karunanidhi's 'hero' manifesto of 2006 that promised among others, free colour TV sets, virtually setting the trend for similar races in the future, Tamil Nadu has seen it all--- free laptops, milch cows, mixer-grinder and gold for thali (mangal sutra) among others.

In 2021 too, the Dravidian majors chose to dish out a slew of promises that carry the 'free of cost' tag, a more politically correct term used to describe freebies by the proponents of such largesse.

The two parties--AIADMK seeking a record third term and the DMK planning a strong combeack after a decade in opposition, have converged not only on such freebies, but also on other contentious issues like the repeal of Citizenship Amendment Act and release of seven convicts in the Rajiv Gandhi assassination.

Free washing machine, housing for all, solar cookers, education loan waiver, government jobs to families without anyone in state service etc are AIADMK's promises to the voter while that of DMK includes Rs 4,000 relief to COVID-19 hit rice ration card holders, laws to reserve 75 per cent jobs for locals and waiver of various loans and provision of various assistance.

Both have promised phased prohibition in a state whose coffers are largely filled by liquor sales, even as DMK's ally Congress promised to implement the dry regime soon after the 'new government', apparently headed by DMK, is installed post polls.

However, on the economic front, experts feel the new government will inherit the mantle of huge fiscal debt and the onus of balancing developmental programmes and sourcing new funds for poll assurances.

It will encounter several challenges, especially amidst apprehension of second covid-19 wave post-election, while both the AIADMK and DMK argue their assurances will get transformed into government schemes when elected to power.

"In my personal view the freebies announced by both the parties are phenomenal. I wonder if anybody has done any financial burden calculation if the party were to implement all its promises when it comes to power," M R Sivaraman, former Union Revenue Secretary, said.

In an apparent reference to the AIADMK, he said "one party" has promised government job to one person from every family without anyone in service.

"This was apparently announced without a reality check on the number of households in the state. Imagine the fiscal commitment which the government would accrue in terms of salaries to all government employees if lakhs of households are accommodated," he told PTI.

K R Shanmugam, director and professor of Madras School of Economics, argues that one-time freebies may not strain the economy in the long run.

"Recurring expenditure in the form of implementing the populist schemes may require huge volume of funds and could leave the government hardly any time and resources to devote to other development activities," he said.

When the poll promises become government schemes, the government would evolve a funding pattern in order to improve the lives of the people, he said.

The state government has performed commendably well to improve the situation during the pandemic and made conditions operational to revive the economy, he noted.

"Tamil Nadu's economy is expected to register a positive growth rate of 2.02 percent in 2020-2021 at a time when the country is facing a negative growth rate of 7.7 percent", he said.

Agreeing there were apprehensions of second COVID-19 wave, he said its effect on economy is debatable.

Maintaining that many of AIADMK's poll assurances are part of the ongoing welfare schemes, former minister and party spokesman S Vaigaiselvan claimed that funding will never be a constraint for the party-led government.

"The performance of the Palaniswami government, the election manifesto and our achievements will ensure us a third successive victory," Vaigaiselvan, also party candidate from Aruppukottai assembly constituency, said.

The DMK is also confident of meeting the financial requirements for implementing its slew of populist promises.

"Our leader M K Stalin and election manifesto are the two heroes in this assembly election. Our poll assurances are doable," DMK spokesperson A Saravanan said.

On Tamil Nadu's huge debt burden of about Rs 5.70 lakh crore by March 2022, he said "the debts and borrowings are because of financial mismanagement by the government. It lacks administrative efficiency. Corruption too played a huge role."

Incidentally, the DMK manifesto, released on March 13, said that implementing all promises was possible by eradicating corruption, pursuing measures including austerity and increasing tax revenue.

Pointing out that the history of such populist promises in the state date back to 1967 when DMK founder C N Annadurai assured three measures of rice for Re 1 through the public distribution system, BJP vice president M Chakravarthy claimed the party failed to implement it when it stormed to power then.

After coming to power, the party changed its slogan to "moondru padi latchiyam, oru padi nichayam" (3 padi (approximately 1.5 kg) is the goal, 1 padi is certain)," he said.

"The DMK also failed to deliver upon its promise of two acres of land to landless poor (made in 2006). But the AIADMK has fulfilled almost all its election assurances," the BJP leader, whose party is an ally of the AIADMK, asserted.

The BJP is fighting the election to ensure the development and welfare initiatives of Prime Minister Narendra Modi reach Tamil Nadu, too.