Welfare Street

On February 26, barely hours before the Election Commission declared the schedule for the assembly election, Tamil Nadu chief minister Edappadi K. Palaniswami (EPS) made the last of a string of ‘poll sop’ announcements. In a landmark waiver to retain the support of women, the mainstay of the AIADMK since the days of the late party icon, J. Jayalalithaa, EPS waived the small loans taken by women self-help groups from cooperative banks and societies (by pledging up to six sovereigns of gold as security).

On the same day, the legislative assembly passed a bill to provide 10.5 per cent reservation for the Vanniyar community in education and jobs within the 20 per cent quota for the Most Backward Classes and De-Notified Communities category, thereby fulfilling the community’s four-decade-old demand. Every new announcement now is made invoking the ‘Puratchi Thalaivi Amma’ (what Jayalalithaa was called reverentially), in whose name numerous welfare schemes were launched even during her lifetime.

A day earlier, on February 25, EPS announced that 2.7 million students in classes 9, 10 and 11 would be automatically promoted without taking the term exams, a favour to the students in the districts who he reckons did not have the advantage of online classes during the Covid pandemic. For 969,000 students in government-run and aided colleges, 2 GB data with free 4G connectivity is being provided from January to April 2021. To win over the 1.2 million-plus government employees, EPS has raised the age of retirement to 60 (after raising it from 58 to 59 just last year).

A farmer himself, EPS has, in what has been described as the ‘Amma of all waivers’, written off loans worth Rs 12,000 crore taken by farmers. In another farmer-friendly measure, they will be provided free three-phase electricity round the clock. Large vegetable and fruit markets will be built in 10 districts at a cost of Rs 20 crore each. The chief minister inaugurated work on the historic Rs 6,941 crore Cauvery-Gundar river interlink project which will take surplus Cauvery river water to thousands of small water bodies to irrigate 110,000 acres spread over six arid districts, and also provide drinking water. The Advanced Institute of Integrated Research in Livestock and Animal Sciences (AIIRLAS), coming up on 1,100 acres near Thalaivasal in Salem at a cost of Rs 1,023 crore, was also inaugurated.

In the early days of his campaign, on December 19, EPS announced a gift hamper and cash grant of Rs 2,500 to all ration card-holders for the Pongal festival in January. Coverage under the Chief Minister’s Health Insurance Scheme has been increased from Rs 2 lakh to Rs 5 lakh, and 2,000 Amma Mini Clinics, each with a doctor, nurse and assistant, are to be established to offer accessible, affordable healthcare. The government has also announced the withdrawal of all cases filed during the Jallikattu and anti-Citizenship (Amendment) Act protests and closure of another 1 million cases for violations during the Covid lockdown. Over 100,000 encroachments by the poor to build homes outside Chennai have been regularised by giving occupants title rights. EPS has promised houses will be built free of cost for farm labour, homeless farmers and the disadvantaged Adi-Dravidar and Arunthathiyar communities.

“EPS’s welfare announcements are three-fold in nature. The first revives some of the party’s previous promises made under Jayalalithaa, targeting women and their economic empowerment, which few had taken note. Next come the schemes that Stalin (the rival DMK president) announces in the morning that are converted into actionable official orders or tweaked as announcements that very evening. It seems to have prompted the DMK president to hold back on other promises for the his poll manifesto,” says political commentator N. Sathiya Moorthy. A third category are repackaging announcements targeting various sections. “One such is that MoUs signed by his government will bring Rs 10 lakh crore in foreign and domestic investments, creating 2 million jobs in the short and medium term. In the light of Jayalalithaa’s pompous global investor meets not achieving the desired results on the job front, the target constituency will be sceptical.”

The poll bonanza, though, has enabled the AIADMK to promote EPS as the party’s public face independent of the triangular internal conflict involving deputy chief minister O. Panneerselvam (OPS) and ‘outsider’ V.K. Sasikala. While EPS is top of the campaign machinery for the party and government, OPS is maintaining a wait-and-watch strategy while spending more energy (and money) on projecting himself.

The BJP had, in the midst of seat-sharing negotiat­ions, been prodding the AIADMK to get Sasikala and the breakaway AMMK (Amma Makkal Munnetra Kazhgam) back onboard to strengthen the alliance. Sasikala’s nephew and AMMK leader T.T.V. Dhinakaran had put conditions for aligning with any party, saying they would do so if they could “head a coalition and with the sole aim of preventing the DMK from returning to power”. But in a dramatic development, on March 3, Sasikala issued a statement saying she was “quitting politics” and asked the cadre “to come together to defeat the DMK”. Sources say this could open the way for a rapprochement between the two parties. The EPS faction in the AIADMK has been opposed to it, while OPS supporters felt Sasikala can contribute to bettering the alliance prospects in at least four districts where her Thevar community has considerable clout.

Meanwhile, EPS’s largesse continues, unmindful of the impact on state finances. The revised estimates for 2020-21 put tax revenues at Rs 1.09 lakh crore (down 18 per cent) against the Rs 1.33 lakh crore anticipated in the budget estimates. The interim budget presented on February 23 by OPS, who is the finance minister, points out that fiscal deficit will widen to Rs 96,890 crore, which is five per cent of GSDP. The state government has been crossing the 3 per cent line on fiscal deficit for the past five years. In 2017-18, it crossed 4 per cent as the government took over a part of state-owned power utility Tangedco’s debt as per the UDAY scheme. With revenues down, the government has had to borrow from various sources to pay salaries, pensions and also spend on the health and welfare department to prevent the spread of Covid-19. The state government estimates the revenue deficit in 2020-21 to be Rs 65,994 crore, three times the Rs 21,617 crore projected in 2020-21 budget estimates.

“Though EPS lacks the charisma and connect Jayalalithaa had with the masses, he compensates for it with a meticulous approach. Money management and distribution of resources is a special trait of EPS,” says Ramu Manivannan, head, department of politics and public administration, Madras University, adding that “it counters the challenge very well as the DMK is unable to generate mass awareness and a large public response”. Consequently, overall debt outstanding as on March 31, 2021 is estimated to be Rs 4.8 lakh crore (by March 31, 2022, it should hit Rs 5.7 lakh crore). However, the debt-GSDP ratio of the state as of March 2021 will be 25 per cent, and as of March 2022, 27 per cent, which will be within the norms prescribed by the 15th Finance Commission. “It was unavoidablethe government had to resort to higher borrowings as there was a sharp drop in revenue. Also, expenditure levels had to be enhanced to protect people’s welfare,” says OPS. It remains to be seen whether the politics of populism and profligacy pays back at the polls.