Madhav Godbole

Control of Public Money – The Fiscal Machinery in Developing Countries by A Premchand; Oxford University Press, New Delhi, 2000; pp 494, price not indicated.

Given the grim financial situation in the state, the state Budget 2001-02 was expected to offer bold initiatives. However, there appears to be a lack of political and administrative will to deal with substantive issues. The budget not only fails to address issues of expenditure management - the question of the burden of wages and salaries, for instance, has assumed serious proportions - but only outlines temporary measures to put the state's finances on a firmer footing.

The reports of successive finance commissions make it clear that the institution of the finance commission is progressively getting trapped in a cul-de-sac. The reports have become a ritual and for the most part have hardly anything new to contribute though the fiscal position of the states and the centre has deteriorated sharply over time. The elaborate quinquennial exercise, lasting over three years on each occasion and involving intensive discussion with all the state governments and central ministries, academics, representatives of trade and industry and other knowledgeable persons, has hardly thrown up any new idea. The successive commissions have instead merely tinkered with the percentages of horizontal distribution among the states along with effecting marginal increases in central devolution.

Power Play: A Study of the Enron Project by Abhay Mehta; Orient Longman, New Delhi, 2000; pp 226 plus xv. MADHAV GODBOLE Enron will be remembered and commented upon for generations as an illconceived, hastily approved project which reduced the Maharashtra State Electricity Board (MSEB) to penury and cast an unsustainable burden on MSEB

Maharashtra budget 2000-01 shows that the government has missed an opportunity to set its house in order. Reformist rhetoric notwithstanding agriculture continues to escape the tax net, procurement schemes for cotton continue to make losses and the state government continues to be downgraded by the credit rating agencies.