The most discussed elements of the Budget are its least significant. The core issue lies in a fiscal decision that the government is yet to fully address: whether to resolve its debt problem through economic growth or by increasing expenditure.
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The scheme that made news, and its actual size
The Annan Seer Thittam scheme, which provides a gold coin and saree for brides, received the most attention, with an allocation of Rs 812 crore. The Thaaimaaman Thanga Mothiram Thittam, offering a gold ring for each newborn delivered in a government hospital, was the second most highlighted, with Rs 560 crore. Additionally, the enhanced fishing assistance, amounting to Rs 135 crore, contributes to a total of approximately Rs 1,500 crore for these symbolically significant welfare transfers. The increase in the Haj subsidy from Rs 25,000 to Rs 35,000 per pilgrim is also noteworthy, although its specific cost is not separately detailed in the Budget speech. It is included within the Rs 1,700 crore allocated to the Backward Classes, Most Backward Classes, and Minorities Welfare Department, which also supports scholarships, women’s aid societies, and burial ground infrastructure.Economists refer to the phenomenon where these schemes capture public attention despite their relatively modest cost as salience bias. This concept from behavioural public finance suggests that both voters and commentators tend to overemphasise spending that is vivid, novel, and personally identifiable, such as a gold ring or a named scheme, over more substantial but less conspicuous expenditures, such as a department’s wage bill. For instance, while a gold ring is easily recognisable, a teacher’s salary is not, even though the latter incurs significantly higher costs. The School Education Department alone was allocated Rs 44,527 crore, nearly thirty times the combined cost of the prominent welfare-transfer schemes announced. The primary concern of the white paper back in June was not the sarees or gold rings, but rather the foundational expenses: salaries, pensions, and interest, which quietly consume the majority of every department’s budget, irrespective of the announcements made publicly.Where the big money actually goes, and what that reveals about the government’s priorities? Here is what today’s speech disclosed by department, ordered by size.Infographics: Harini TS/ThePrint
