P.Chidambaram talks about the Leave Travel Concession(LTC) scheme
Palaniappan Chidambaram called the Finance Minister Nirmala Sitharaman’s stimulus package to boost consumption demand another “sly attempt to dazzle the people with exaggerated numbers”. He said the announcement about the Rs 20 lakh crore Atmanirbhar package was a "candid confession" and it was a "massive failure". "The stimulus is not of a value of Rs 73,000 crore. Nor is it of the value of Rs 1,00,000 crore. The fiscal impact of these announcements is estimated by analysts to be a mere 0.1 percent of GDP," he added.
Sitharaman on Monday announced two sets of measures to generate consumer demand and boost capital spending, which along with the participation of the private sector, are estimated to result in quick spending of more than Rs 1 lakh crore by March-end. “The grand announcement was no stimulus package to push economic growth, it was another sly attempt to dazzle the people with exaggerated numbers and lead them to believe that the government is hands-on and responsive to the needs of the people and the economy,” the former finance minister said.
Chidambaram said that the government is trying to play the role of "ma-baap" when commenting on the Leave Travel Concession(LTC), as it seems to dictate the government servants what amount and on what goods and when they should spend their own money. “Just as BJP has been telling people what to eat, what to wear, what language to speak, who to love, who to marry etc, it is now trying to control people on their spending preferences. This is another piece of retrograde interference in people’s lives,” he said.
The Interest-Free Festival
The ministry is allowing government and private sector employees to use their Leave Travel Concession tax-free benefit for various types of purchases subject to certain conditions while an interest-free festival advance of Rs 10,000 is being given to government employees.
“The Rs 10,000 crore interest-free festival advance is not additional expenditure. It will be recovered in 10 monthly installments. It is like buying on equated monthly installments, that is EMI. Also, the offer of a tax concession to 35 lakh central government employees on LTC is a pathetic attempt to induce them to spend twice that amount out of their own money to gain a small benefit on tax,” he said.
“Government stubbornly refuses to make a cash transfer to their accounts as recommended by dozens of economists and as demanded by the Congress and other political parties. I am sure they are watching the government’s pitiful efforts to revive the economy that will register a de-growth of 10 percent in 2020-21,” Chidambaram said.