UDF's White Paper a Roadmap for Regression, Warns Former Finance Minister Thomas Isaac

Thiruvananthapuram: CPI(M) Central Committee member and former Finance Minister Dr T M Thomas Isaac has warned that the UDF government's new fiscal policy and white paper will push Kerala into a major economic setback. He said none of the Indira Guarantees announced by the UDF government during the election campaign are likely to be implemented, and that the state's infrastructure development momentum will be severely curtailed.

Isaac listed several alarming policy directions emerging from the white paper: salary revisions to be held once every ten years instead of five; pension age to be raised; welfare pensions to no longer be delivered to beneficiaries' homes, forcing recipients to collect from banks themselves — a change that will disrupt many welfare schemes; and several public sector institutions facing closure. "Keralam is headed for a massive regression," he warned.

He pointed out that the white paper contains none of the revenue-mobilisation measures Chief Minister V D Satheesan had promised during the election campaign — including recovering ₹25,000 crore in revenue arrears, collecting ₹15,000 crore from gold-related GST, and plugging IGST leakages estimated at over ₹20,000 crore in the first five years alone.

Thomas Isaac accused the white paper of framing the state's fiscal situation as a product of financial indiscipline rather than acknowledging the real cause — severe central discrimination against Keralam. He noted that while the central share of revenue for other states averages around 50 percent, Keralam received only about 25 percent of its total revenue from central transfers last year. Keralam's share of total central grants and centrally sponsored scheme funds amounts to a mere 1.9 percent. The white paper, he said, barely mentions this and the policy statement makes no criticism of the centre whatsoever — a continuation of the UDF's longstanding reluctance to confront central neglect.

On KIIFB, Isaac said moving it under a government department would render it redundant. He defended the institution as a mechanism that delivered in years what would otherwise have taken a quarter century through normal budgetary channels. He criticised the white paper for endorsing the central government's decision to count KIIFB borrowings within the state's debt ceiling — a position Satheesan himself had advocated in the assembly even before the CAG flagged it.

He also rejected the white paper's debt alarmism, noting that Keralam's debt-to-GDP ratio has actually fallen from 42 percent to 33.22 percent over the past decade — a fact that a more complete comparative analysis would have made clear. "Keralam is not in a debt trap," he said flatly.