‘Navakeralathe Nayikan Putuvazhikal’ (New Ways to Direct New Kerala), the policy document presented by Kerala Chief Minister Pinarayi Vijayan at the ongoing CPI(M) state conference in Kollam, stresses the need to explore new avenues for resource mobilisation in Kerala.
The document emphasizes identifying sectors where taxes remain nominal and developing these areas. “We should ensure the collection of leases and other dues from different sectors without fail, thereby strengthening resource mobilization efforts,” states the policy document, which is set to undergo discussion at the conference.
The Chief Minister’s policy document also proposes considering additional cesses. “We need to evaluate whether all freebies should be extended even to those from economically well-off sections. The demographic structure should be classified based on income, and fees should be imposed accordingly,” the document suggests.
Notably, the idea of increasing fees for public services for economically stronger sections has been consistently advocated by economists like Mary George, former Chairperson of the Public Expenditure Review Committee.
Speaking to THE WEEK, George noted that if the CPI(M) adopts this as policy and the LDF government implements it effectively, it could serve as a viable method for additional resource mobilization.
She cited the example of free travel for all students, regardless of their economic background. “Children from affluent families also receive free passes, while the Kerala State Road Transport Corporation (KSRTC) continues to face financial difficulties,” she pointed out. “Students from economically weaker sections should have access to free travel, but those with financial resources should contribute to their children’s transport costs.”
George also highlighted that Kerala is a consumer state and that a significant portion of the population could bear some additional fees if implemented wisely by the Vijayan government. “However, the government’s responsibility is not just to collect more taxes but also to utilise them efficiently,” she said. “It must be ensured that the revenue is used for Kerala’s development. If that is guaranteed, imposing higher fees on high-income groups is justifiable.”
The policy document also advocates restructuring irreparable public sector undertakings (PSUs) under a public-private partnership (PPP) model. “We should consider signing agreements with entities willing to manage these institutions under clear conditions,” the document states. This signals a shift in the CPI(M)’s stance, indicating a move toward accepting the disinvestment of loss-making PSUs.