Listen To This Post

Written by OM Thakur

Shimla : Himachal Pradesh Chief Minister Sukhvinder Singh Sukhu on Saturday presented a ₹54,928 crore Budget for 2026–27 in the state Assembly, striking a balance between fiscal prudence and welfare commitments amid mounting financial constraints. Marking a significant moment, Sukhu—who also holds the Finance portfolio—said this was the first Budget since 1952 without Revenue Deficit Grant (RDG) support from the Centre, calling the decision “unfair” and a setback for a hill state with structural financial limitations.

Austerity signal: Salary deferment across political executive

In a clear acknowledgment of the state’s strained finances, the Chief Minister announced temporary salary deferments for six months:

• 50% deferment for the Chief Minister
• 30% for Deputy CM and Ministers
• 20% for MLAs

He also appealed to the High Court and district judiciary to consider a 20–30% voluntary deferment, assuring that the deferred amounts would be restored once the fiscal situation stabilises. The move is being seen as a symbolic as well as practical step to signal financial discipline at the top.

MGNREGA continues despite funding strain

Reaffirming commitment to rural livelihoods, Sukhu announced that MGNREGA will continue in the state, with the government ready to fund it from its own resources if needed.

The scheme is expected to generate around 4 lakh man-days, but may impose an additional burden of ₹300–600 crore on the exchequer—highlighting the tightrope between welfare spending and fiscal sustainability.

Focused push for poorest households

The Budget places strong emphasis on targeted social welfare, particularly for the most vulnerable:

• The state will refine its BPL (Below Poverty Line) list, currently covering 2.65 lakh families, to identify the “poorest of the poor.”
• 1 lakh such families will be supported under the Mukhya Mantri Apna Sukhi Parivar Yojana.

Key benefits include:

• 300 units of free electricity
• Housing assistance for 27,000 families without pucca homes
• ₹1,500 monthly support for women in these households, in line with the government’s guarantees

Balancing welfare with fiscal realism

Sukhu’s fourth Budget reflects a delicate balancing act—expanding welfare coverage while introducing cost-control measures to manage limited resources. The absence of RDG has clearly shaped the state’s fiscal strategy, pushing the government towards internal resource mobilisation and expenditure prioritisation.

Political and economic message

By combining austerity at the top with targeted support at the bottom, the Budget attempts to send a dual message: shared sacrifice and inclusive development. However, the coming months will test the government’s ability to sustain welfare commitments without widening the fiscal deficit. Overall, the Budget underscores Himachal Pradesh’s evolving financial reality—where reduced central support, rising welfare expectations, and structural constraints are redefining governance priorities in the hill state.