‘Do unpaid bills become savings?’: DMK questions Vijay government’s claim of lower borrowing | Political Pulse News
Tamil Nadu’s former finance minister Thangam Thennarasu has questioned the C Joseph Vijay government’s attempt to portray reduced borrowing as evidence of improved financial management, arguing that the decline could instead reflect delayed infrastructure projects, unpaid contractor bills, and an inability to undertake planned capital expenditure.
The senior DMK leader challenged the Tamilaga Vettri Kazhagam (TVK) government to disclose how much it had actually spent on infrastructure and other capital works during the first six months of 2026-27, and how much remained unpaid for projects initiated under the previous DMK administration.
His criticism followed reports that Tamil Nadu’s borrowing through State government securities declined by 21 per cent during April-September compared with the corresponding period last year. “Can delaying development works, withholding payments for completed projects, showing a higher cash balance and borrowing less be described as an achievement in financial management?” Thennarasu asked. “Do amounts that remain unpaid become savings?”
The intervention brings a new dimension to the political debate over Tamil Nadu’s finances, which has largely centred on the state’s mounting debt, weakening revenue mobilisation and the new administration’s promise to restore fiscal discipline through administrative reforms.
Thennarasu argued that borrowing figures alone offered an incomplete picture of the government’s financial position. Lower borrowing, he suggested, could indicate that expenditure had been postponed rather than that the State had become financially stronger.
Under the DMK government’s 2025-26 Budget, Rs 57,231 crore had been allocated for capital expenditure. According to provisional monthly accounts of the Comptroller and Auditor General cited by Thennarasu, the State spent Rs 13,002.22 crore on capital works, including Metro Rail projects, between April and September 2025.
He demanded corresponding figures for the same six-month period this year.
“How much of the total funds allocated for capital expenditure in this financial year has the TVK government actually spent during April-September? How much was spent on new infrastructure projects? How much is still pending payment for projects initiated and implemented during the DMK government?” he asked.
The former minister also pointed to the government’s borrowing plans for the next quarter, questioning whether the reported first-half reduction could be sustained.
“The TVK government, which claims that borrowing declined in the first half, has planned to borrow Rs 48,000 crore in the October-December quarter alone. Is that not more than twice the Rs 23,500 crore borrowed in the previous quarter?” he asked.
His criticism comes two months after the Vijay administration presented its first Budget, promising an expansion of welfare programmes alongside tighter procurement rules, improved tax administration and technology-driven efforts to increase government revenue.
Finance Minister N Marie Wilson had acknowledged that Tamil Nadu’s debt had doubled over the preceding five years and that rising interest payments and other committed expenditure had sharply restricted the State’s capacity to finance new programmes.
The government’s Revised Budget Estimates placed outstanding debt at approximately Rs 10.99 lakh crore, marginally below the Rs 10,99,458 crore projected in the Interim Budget presented by the previous administration.
Wilson had argued that reforms in GST assessment, property registration and mining administration could generate approximately Rs 15,000 crore in additional revenue, while a new levy on liquor manufacturers could bring in up to Rs 1,000 crore annually.
The government also constituted a Revenue Augmentation Committee headed by former Planning Commission Deputy Chairman Montek Singh Ahluwalia to examine the structural weaknesses that had prevented Tamil Nadu’s revenue collections from keeping pace with economic growth. But Thennarasu’s statement shifts attention from revenue mobilisation to the other side of the State’s finances: whether expenditure, particularly on infrastructure and capital formation, is proceeding as planned.
The distinction matters because a reduction in borrowing does not necessarily establish improved fiscal health. Borrowing requirements can fall when revenues improve or expenditure declines, but also when projects are delayed, payments are deferred or planned investments are not undertaken. Establishing which explanation applies requires actual expenditure and payment data.
Thennarasu alleged that the government’s revenue collections were already falling below Budget projections and that its inability to undertake investment expenditure was the principal reason for reduced borrowing requirements.
“Tenders worth several thousand crores of rupees have been cancelled. Roads are in poor condition because development works have not been undertaken. Building projects remain half-finished. Thousands of people have lost their jobs,” he alleged.
The Budget presented in August had promised substantial infrastructure investments, including Rs 9,300 crore under the Comprehensive Road Infrastructure Development Programme, Rs 2,117 crore for an integrated urban development mission and Rs 500 crore for electrical and mechanical infrastructure to support 1,000 new air-conditioned electric buses in Chennai.
It also outlined several longer-term industrial, housing and urban development projects, although some remained at the stage of feasibility studies and policy formulation.
Thennarasu’s allegations do not, by themselves, establish that these allocations have gone unspent or that payments have been withheld. They raise questions that would require the government’s expenditure accounts, project implementation records and outstanding payment figures to resolve.
The former minister demanded that the administration publish those details rather than present lower borrowing as a standalone achievement. “Instead of misleading people by claiming this as their achievement, the TVK government must release complete details of the capital expenditure undertaken and the payments still withheld for completed works, and answer to the people,” he said.
The dispute now turns on a question more consequential than the amount Tamil Nadu borrowed in six months – whether the government has reduced its financing needs through genuine fiscal improvement, or merely postponed expenditure that will eventually have to be met.
