The Budget 2011-12 would be marked by the absence of any new big-ticket populist scheme, other than the food security law which is a foregone conclusion. According to sources, people involved in the budget-making exercise has committed themselves to the need to curb runaway expenditure on social sector schemes, which became a salient feature of the budgets in recent years.

While finance minister Pranab Mukherjee may announce a limited number of new schemes in his Budget speech, they would be provided only token fundings and will be operationalised only during 2012-13 after doing proper homework.

?Being the last year of 11th Five Year Plan, the government does not want to risk introducing new schemes without proper homework. The failure of new schemes will set bad precedent for the 12th Plan that will set in from April 2012,? said an official of the Planning Commission asking not to be named.

The government reckons that although one-time gains like the over a lakh crore revenue garnered from 3G spectrum auction helped contain its borrowing levels this fiscal, there is little prospect of such windfalls next fiscal. This makes expenditure control all the more important for the medium-term fiscal consolidation plan.

The casualty of the move could be schemes like job guarantee programme for urban poor on the lines of Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS), schemes for improving sports infrastructure in the country and few other schemes for rural development and education that are on the inclusive-growth agenda of the government.

The major social sector schemes announced in recent years include Rajiv Awas Yojana, farm loan waiver scheme and the Jawaharlal Nehru National Urban Renewal Mission.

Apart from concern on fiscal deficit, a new monitoring system has been put in place by the government where ministries implementing the schemes have to submit results framework document (RFD) highlighting the performance and fund use of each scheme under their administration. This has put pressure on ministries to show results to continue getting funds for schemes. In the past, several schemes have been discontinued or their funding has been reduced for poor performance.

In the light of this, Planning Commission which has the task of finalising the gross budgetary support (GBS) for annual Plan 2011-12 has already been told by the finance ministry to work out the new GBS on an increase of 15% over the budgetary support extended during the current fiscal (2010-11) and ask ministries to come fully prepared before proposing any new scheme.

While the commission pitched for a 20% increase in GBS for next fiscal, it will have to settle for a lot lesser increase.

The commission on its part has also informed central ministries about configuring their expenditure plans based on just 15% increase in GBS and focus on proper implementation of existing schemes. Several proposals for new schemes by ministries has already been rejected by the commission. A few schemes that may be announced could be given mere Rs 1 -2 crore token allocation with full allocation coming only in 2012-13 after a detailed report.

A moderate GBS increase with high inflation would mean that growth in GBS this year could actually be negative in real terms. In absolute terms, 15% growth in GBS for 2011-12 means just over Rs 3,30,000-crore budgetary support. In 2011-11, the GBS rose by over 22% (BE) over the previous year.

While the revenue position looks good in 2010-11 with more-than-expected funds coming from 3G auctions, the government looks sitting pretty on fiscal front. But it has already committed additional allocation of over Rs 74,000 crore this fiscal through supplementary grants ? still making it look for other sources to maintain the fiscal deficit target of 5.5% this year. The tightening of the screw for next fiscal will ensure that the government manages to further reduce deficit to 4.8% levels as targeted.