THE WEEK IN PARLIAMENT

Subhas Ray

WHEN the parliament was adjourned sine die after the finance bill’s passage, this unprecedented step invited much criticism from members who apprehended that the government might bring an ordinance on the ‘office of profit’ issue instead of coming up with a comprehensive bill during the session. Though the definition of ‘office of profit’ in clause 3 of the Prevention of Disqualification Act 1959 is not clear, the government thought of amending this act through an ordinance. The issue has already taken the toll of Jaya Bachchan’s Rajya Sabha membership and threatens many other MPs.

When the NDA and SP members targeted the Congress president Sonia Gandhi for holding the post of chairperson of the National Advisory Council, she resigned from Lok Sabha so as to deprive her critics of any further chance to attack. This created a sort of political storm in the country. To some it was unnecessary while to others the bureaucrats do not want the people’s representatives to take over their domain like the chairmanships of corporations. As of now hundreds of people’s representatives, MLAs and MPs, are holding such positions in corporations and other institutions. In any case, the whole episode necessitates a comprehensive law to deal with the office of profit issue effectively, clear all hazes and plug loopholes.

BUDGET DISCUSSION

Both the houses have now passed the finance bill 2006. From the CPI(M), Sitaram Yechury participated in the discussion in Rajya Sabha and Rupchand Pal, Varkala Radhakrishnan, T K Hamza and Lonappan Nambadan in Lok Sabha. The text of Yechury’s speech was published in these columns last week.

Rupchand Pal pointed out that a large number of exemptions in respect of customs and other duties benefit only industrialists and not others. India is a country with a very low share of the corporate tax and income tax in GDP. While the rich are enjoying several exemptions, the poor and middle-class people are facing the brunt of taxation. In this country, even the companies making a profit of more than Rs 500 crore are under-taxed and continue to get one or another sort of exemption. As regards indirect taxes that impact the masses, the minister gloated that there is 20 per cent growth in tax collection. As the minister is trying to bring the service tax and freight tax at par, Pal asked how the revenue would be shared between the states and the centre. He charged the government with patronising the big companies and ignoring the small ones wherein lakhs of people are engaged. He said small and medium units are an important sector of the economy and have to be adequately supported and strengthened as they provide much employment. As the instrument of central excise duty is not being used in favour of small industries, it will have to be reoriented in such a manner as may help these labour intensive units. As regards service tax, 15 more services have been covered by it. However, the service tax, collected by service providers for their services, is ultimately passed on to consumers and it will burden the latter, he said. Pal also noted that some service providers are collecting the tax but not depositing the same. On the other hand, the government has made certain surreptitious moves that harm the employees, pension holders and retirees. The government has ignored the standing committee on finance’s recommendation about a re-look at non-farm activities. It is also afraid of touching the religious trusts, to whom benami donations are being made unabated. Even after a Supreme Court judgement, Pal pointed out, crores of rupees are being collected by education trusts through benami donations.    

Varkala Radhakrishnan demanded that Kerala be compensated in regard to value added tax. The tenth finance commission recommendations must be implemented strictly and the state governments facing difficulties in financial matters must be helped. He also apprehended that the introduction of FDI in retail trade would adversely affect lakhs of people living in rural areas. As for Kerala, it produces about 90 per cent of the natural rubber produced in the country. But its import is the order of the day and Kerala’s own rubber has become the target. Therefore, the government has to take immediate steps to save the Kerala rubber growers. He also demanded an increased allocation for mid-day meal scheme throughout the country, adequate protection and encouragement to the South Indians employed in the Gulf countries, full relief to agriculturists and waiving of farmers’ debts.

T K Hamza dealt with the problems facing the roof-tile units in the country due to imposition of central excise duty, throwing thousands of families out of job. He demanded withdrawal of this duty. 

Lonappan Nambadan (CPI-M) demanded withdrawal of the proposed imposition of central excise duty on umbrellas and hand-made soaps.

PETROLEUM & NATURAL GAS

With the passage of the Petroleum and Natural Gas Regulatory Board Bill 2006 in Lok Sabha, it has now got the parliament’s sanction. The CPI(M)’s Sujan Chakraborty, K S Manoj and V Radhakrishnan participated in the debate on it. 

Emphasising the need to take the energy question seriously, Sujan Chakraborty said there must be some balance in the distribution of oil and gas. Talking of the good gas reserves in northern, southern and western states and in Sunderbans in West Bengal, he said these days gas has become more important than oil. So the question of gas exploration and its equitable distribution is very important for the development of states. Moreover, the states must also have a say in it since it has a bearing on their development. As a number of scams in the field of oil and gas have taken place over the years, the states’ involvement in the process of registration is a must. He demanded that the bill must be sent again to the standing committee to scrutinise the new points that have been incorporated.  Dealing with the composition of the proposed board, appellate committee etc, he said the chairperson of such an important board must be a technical hand. The question of checking adulteration and making it known to consumers is important. The most important thing for the protection of consumers is pricing. He pointed out that taxes account for some 60 per cent of the oil price that has increased four times in one and a half years. So there must be a pricing mechanism in respect of oil and gas.

K S Manoj said providing service and protecting the people from fleecing were the main objectives of public sector enterprises while profit is the primary concern for the private companies coming into various fields. So it should be ensured that these private companies fulfil their social obligations, especially regarding the quality of service and prices. Autonomy and accountability are also important in regard to the regulatory agencies, as autonomy without accountability could lead to chaos.  Hence an appropriate mechanism needs to be put in place to make the regulatory agencies accountable. Manoj also asked the government to take care of the welfare of poor sales girls who work in petroleum outlets but are not adequately paid.

V Radhakrishnan said there is now, all of a sudden, a tendency to open petrol and diesel outlets after every furlong on the national highways. He asked: how were these sanctioned? He expressed concern over adulteration of petroleum products all over the country, as kerosene or something else is added to petro-products and supplied to consumers. Yet, there is no controlling authority and specified standard for petro-products. About the proposed board, he demanded some mechanism for regulation. We have a common appellate tribunal for electricity and petro-products, with the addition of a technical member to the board. But High Courts are completely excluded from the purview of this bill and, if an aggrieved party has to file an appeal, he has to go to the Supreme Court. That will create a very difficult situation. Radhakrishnan also asked the government not to fill the board with retired bureaucrats.         March 26, 2006