Moody's and Standard&Poor to downgrade Tamil Nadu Government Sovereign Rating this year 2015!

03-Jan-2015: 3.35pm Savage, USA.

The predictions have become true. I have been predicting for over 6 months that Tamil Nadu's finances are looking grim. I even wrote that the Tamil Nadu budget 2013-14 was falling into Niagara Falls. The current news is out that the Tamil Nadu government will miss the budget target of Rs 91,835 crores by a whopping Rs. 20,000 crores. That is 21.7% shortfall of budgeted revenues. Tamil Nadu will not be able to meet the Targets of  2003 Fiscal Responsibility and Budget Management Act's goals. The result will be that the Moody's and Standard&Poor will downgrade the Sovereign rating of Tamil Nadu government, this year 2015. 

Tamil Nadu Revenue Projections 2014-15 Goes Awry!

Update. 01-Jan-2015, Savage USA

I have been monitoring to see the Tamil Nadu government's mid-year 2014-15 financial update. I have not seen an official report, although I searched google extensively today to see any publication on it. I could not find anything. However, I saw a report on Vikatan.com website. It had given some financial figures for the current year 2014-15. And I update this blog as: For the current year 2014-15, the Tamil Nadu government achieved Revenue collections for the first 6 monts ending Sep 2014 as:

1. Total revenue reached Rs. 37,056 crores only at the end of Q2,  as against the total annual budgeted Revenue of Rs. 91,835 crore.
2. Commercial Tax growth was only 1.48% during first half of current year.
3. Excise tax growth for the first 6 months only at 10.87% as against 28% budgeted growth.
4. Registrations tax collections ( stamp duty on property sales etc) had a Negative growth of -2.45%.
5. Tax collection from Vehicle taxes are also substancially lower at 7% against 39%.

6. Cental Government collections are also much lower than forecast. Tamil Nadu will not receive the full budgeted Cental share of tax Rs. 19,014 Crores cor current year!.

Let's wait and see how Mr. Panneerselvam handle this dire situation in Tamil Nadu Finances this year!..


12-Dec-2014., Savage, USA
I had heavily criticized the Tamil Nadu budget early this year. Now, I reviewed that Tamil Nadu budget's estimates if they are being met or not!. First, the Revenue forecast went awry. Tamil Nadu is scrambling to meet the Revenue projections with shocking unpublished, non-transparent, hypo-critic measures. Few months back  Tamil Nadu government secretly increased the liquor prices as much as 40% and an average increase of 17% on all brands of liquors sold at TASMAC. Now, the TN Electricity Regulator Agency, which had the Tariff revision in cold storage before Elections, brought the Tariff Revision abruptly with 15% increase to Reduce the Losses for the erstwhile TNEB(TANGEDCO). Remember the Milk prices were revised mid year, not in Budget!. Because the revenue dried up, Tamil Nadu reduced the provisions to MGNREGA  by as much as 70% this year in some districts!.

Tamil Nadu PSUs made a net Loss of Rs. 52,088 crore during the past 6 years!

The people of Tamil Nadu, are vested with ownership of 63 (TN state) PSU corporations, run by Govt of Tamil Nadu.

The Loss of operating the PSUs by the Tamil Nadu government exceeded Rs 13,000 Crore at the end the Year 2013. In the 6 years from 2007-08 to 2012-13 Total Losses ==> Rs. 52,088 Crore.

Why would Tamil Nadu governtment after having lost Rs. 52,088 crore, the people Tax money, still wants open up new businesses such as Amma Restaurant, Amma Pharmacy etc? 

Campaign:: Justice for Citizens of Tamil Nadu!

This Campaign is started for Justice for Tamil Nadu people. Just a 12-13 Lakh employees of Tamil Nadu government staff taking 54%(Rs 54,000 crore) of the pie of Tamil Nadu government's Revenue(Rs.99,900 crore).  Remaining 46% of the pie is only spent for 7 crore population. This is a colossal discrimination!!. Please support. Throw your ideas!. This monumental skewed government budget was in 15 years of making, by two major parties of Tamil Nadu!. Not a single state in USA spends more than 4-5% for Wage bill of the state. Additionally to know , Gujarat is spending only 16% for salaries and pensions of govt staff. I am asking if the Government directs 54% to the servants of governed , from the powers given by governed and the govt spends only 46% for the welfare of the governed who gave the powers to the govt for governing, isn't this colossal unfairness and discrimination? In democratic republics, most countries spend about 5% for the government to govern citizens. My question is how we got into this situation. And how many in Tamil Nadu are aware of?. And what's the remedy?. My campaign's first purpose is creating awareness. Please join this debate!.

5th Sep 2014:
Researching on how much the TN Government was spending for Govt staff, when Kamaraj was the CM and one of the biggest Project of building the Bhavani Sagar Reservoir was going on.........if any any one has data please pass it on.....

6th Sep 2014:
The central government spends only less than 6% of its Revenue to run the Govt. That is, the govt salaries and pensions are less than 6%.  Now, you wonder why TN spends 54% of Revenue to run the TN state government?

6th Sep 2014:
Asked the Tamil Nadu BJP president Tamilisai Soundararajan to give me time to discuss this matter over phone with her. I sent her a Facebook message asking her to call me with my phone number. 

6th Sep 2014:
Posted a message to Mr. Ravishankar Prasad's facebook page, mentioning that the Fiscal Responsibility and Budget Management Act 2003 needs an amendment. This act only addressed the fiscal deficit crisis of 2003. But, now the new crisis is State Governments are spending too much of budget money to just run the Government itself. TN govt spending 54% of its Revenue just run the govt is shocking, unacceptable for a democratic state. This would make FDIs disappear from Tamil Nadu. Can not be tolerated. It needs immediate attention from Supreme Court and Central Government!. So, the 2003 FRBM act needs immediate amendment before the next fiscal begins in April 2015. 

How to fix Tamil Nadu Govt Finances.

The budget documents are prepared in such a way it deceives even educated auditors. Even they don't know the whole truth behind the Tamil Nadu budget!. As I have explained earlier, the TN Govt is spending nearly 50% of its revenue just for about 12 Lakh employees during the last 4-5 years. Only remaining 50% is spent for the 7 crore population!. The Govt. employees have strong unions. Its very difficult to bring down their salaries and perks right away. Only a carrot-stick approach can help. A strong political will is required to bring reforms in Govt Service Responsibility Act to offer services to people on a pre-determined period, expressed in days, for all Govt services. Unions, will reject such rules. Downsizing the staff, and improving performance is another way to bring down Employee expenses. Introduction of performance based salaries should not be ruled out for Govt. employees. The govt expenses for employees should be brought below 10% of Govt's revenue on long term basis. In short term, it should be at least brought down to 25% in the next 5 years. If not, Tamil Nadu can not compete with states like Gujarat, where Govt expenses for employees were only 17% in 2013-14 budget. 

Tamil Nadu People deprived of their fair share from the Govt budget!

Every person in Tamil Nadu is paying tax to the Tamil Nadu government when they use soap, tooth paste, cloths, cigarette, petrol etc. Almost every family is paying tax. This year TN govt collects taxes from Tamil Nadu people, a total budgeted amount Rs. 99,919 Crore. How much it spent for the Employees who offer the Services to the people of Tamil Nadu, to keep the Law&Order , to issue various certificates, register documents, etc? That amount as per budget is Rs 51,000 Crore. There is no other government in anywhere in the world, paying 51% of Revenue to its employees. Do you still think Tamil Nadu people need to pay bribes to get the works done by these employees?  Or kept surrendered to them!? Half of the Tax the tamil nadu people pay each year is given out as wages and pensions. In addition, the bribes are second taxes on the Tamil Nadu people? Is this not surrender?    Gujarat only spends 16% of its Revenue for Govt employee salaries and pensions!!!! Gujarat, is the way to go!.

During Kamaraj period(1962-63),  the Govt staff salaries and pensions were only around 7% of revenue. Kamaraj built Bhavani Sagar Reservoir in record time and below its budget amount.

If their salaries were not increased by 10% of  their base salary, the state(people) will have  Rs 10, 000 crore each year for next 10 years.  This would amount to Rs. 1 Lakh crore. It could used for keeping Tamil Nadu clean, water for more districts and better Roads and Bridges, more infrastructure etc and make Tamil Nadu a world class state. Only if all Tamil people come together!?

Tamil Nadu people are deprived of their due share from the Govt Revenue. 12-13 Lakhs of govt staff taking 50% of revenue of State Govt that was generated from 7 crore population and only remaining 49% or so, is left for the 7 crore Population.  7 Crore people are completely ill informed of this. Spin campaigns such as free Grinder, Mixie and Amma pharmacy and Amma canteen etc are taking the Media space. No media and opposition party had studied and analyzed this issue to inform Tamil Nadu people.

Source: 1. Budget documents of TN Govt website: http://www.tnbudget.tn.gov.in/ . 2. Gujarat Govt Budget documents

Authentic Truth behind Freedom of India.

On a historic day, July 5th 1945, UK general elections held. Historians still struggling to explain how could the war veteran Winston Churchill lost this election, almost the winning of the War is only a few weeks away.  Historians blamed it on anti-incumbency due to unemployment and general frustration after 6 years of World War II. Another perspective was that British people believed Labor party is better positioned for reconstruction of UK after WWII,  than Conservative party.
Anyhow, the Labor Party leader Clement Attlee assumes office of the Prime Minister of United Kingdom, on 26th July 1945.  

In less than a year after taking over as PM, Mr Attlee announces the UK cabinet's decision, to free India, on 16th March 1946.   Mr Attlee literally decided washing his hands off of largest British colony. Mr Attlee had no interest on the future of India unlike Mr. Churchill. Destiny began on that day, 16th March 1946.