Free cash everywhere! States' election win pitch with Maha freebies comes with big budget burden
Delhi government’s ambitious plan to provide ₹1,000 per month to women over 18 years of age under the Mukhya Mantri Mahila Samman Yojana (MMMSY) is projected to cost ₹4,560 crore annually, according to the finance department. With the city’s subsidy bill nearing ₹11,000 crore, officials have raised concerns that implementing the scheme from FY 2025-26 could result in a budgetary deficit.
A draft proposal for the scheme, submitted by the Women and Child Development Department, estimates that approximately 38 lakh women in Delhi would qualify for financial assistance. However, the finance department has cautioned that a revenue deficit could lead to central government intervention, potentially limiting Delhi’s financial autonomy.
Fiscal challenges amid rising expenditure
Delhi’s finance department highlighted that the city’s government, unlike other states, cannot raise market loans and must rely on the costlier National Small Saving Fund for borrowing. The additional expenditure from MMMSY and other commitments, such as a ₹2,500 crore grant to the Delhi Jal Board, could increase revenue liability by ₹7,000 crore in FY 2025-26.
The department’s communication to Chief Minister Atishi noted that anticipated revenue growth would likely fall short of covering incremental liabilities and normal expenditure increases. “There is a serious possibility of significant revenue and budget deficits and cash imbalances,” it warned.
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By — Shraddha Somani, Digital
