In Karnataka, lacklustre Congress performance casts a shadow on guarantee schemes

Riding on its guarantees which particularly focus on women voters, Congress hoped to win 15-20 LS seats from the state. However, despite an increased vote share, a lacklustre performance in the polls has cast a shadow on the guarantee schemes, and many party legislators have urged the government to revisit them. But with local body elections nearing, the Congress has no immediate plans to discontinue the guarantees.

In the just-concluded LS polls, BJP secured 46 percent vote share (contested in 25 seats), while Congress garnered 45.4 percent (contested in all 28 seats). JD (S), an alliance partner of the BJP, contested three seats and secured 5.6 percent share.

In the 2019 Lok Sabha polls, BJP had a vote share of 51.3 percent, whereas Congress had 31.8 percent. JD (S), allied with Congress then and had contested in two seats, obtained 9.6 percent.

Though the Congress improved its vote share and tally by winning nine seats — up from one in 2019 — it couldn't reach double digits. In Bengaluru Rural, the only seat Congress had won in 2019, KPCC (Karnataka Pradesh Congress Committee) President and Deputy CM DK Shivakumar’s brother, DK Suresh, lost.  Also, Siddaramaiah failed to secure a victory for the Congress candidate in Mysuru, his home district.

The Congress fared poorly in the state capital, Bengaluru, and the southern Karnataka region. However, in North Karnataka, one of the most backward regions in the state where its guarantees may have worked, the party performed well. Five of the nine seats it won in the state came from the Kalyana-Karnataka region, which is Congress President Mallikarjun Kharge’s home turf.

Also, read: Reversing the trend: Bengaluru's BMTC regains ridership with free bus travel for women

Clamour in Congress to end guarantees

Post LS poll results, many Congress legislators publicly stated that the party should reconsider its schemes, as they did not yield any electoral benefit and came at the cost of development.

However, Siddaramaiah said that the guarantees will continue: "The schemes weren't rolled out for political reasons. It is our commitment to the people of the state. We introduced these guarantees to help people."

Sandeep Shastri, Director, Academics, at NITTE Education Trust and National Coordinator of the Lokniti Network, said: "Guarantees did help but not to the extent the Congress wanted. The Lokniti-CSDS post-poll survey showed that more than half the women of Karnataka had voted for the Congress. The impact of the guarantees was seen when the Congress captured half of the 14 seats in North Karnataka (second phase of polls in Karnataka). But BJP had a 10 percent advantage among male voters across the state. Also, the Congress failed to bring a large number of women voters to the polling booths."

Also, read: Lok Sabha polls: Congress banks on Nari 'Shakti' in Karnataka

JT Patil, Congress MLA from Bilgi, in Bagalkot district, is among those who have urged Siddaramaiah to rethink the guarantees. “Guarantees haven’t worked in many places,” he said. M Lakshmana, a defeated Congress candidate from Mysore-Kodagu LS constituency, said, "More than 70 percent of the beneficiaries of the guarantee schemes are wealthy. Why give free electricity to someone with an expensive car and a salary over Rs 25,000? The CM should reconsider these benefits." Later, he clarified that he didn't mean that the schemes should be stopped,  but that they should only reach the needy.

Also, read: BJP's Yaduveer Krishnadatta Chamaraja Wadiyar defeats Congress rival M Lakshman in Mysore

Earlier this year, Congress MLA HC Balakrishna suggested stopping the five guarantees if the party performed poorly in the LS elections. In July 2023, Shivakumar had asked Congress MLAs to be patient as the government was using its resources to fund the guarantees and was short on funds for development. "We will not be able to provide adequate funds for the irrigation department or PWD, but there is a huge expectation (from MLAs). The previous BJP government has bankrupted the state, emptied the exchequer," he had said.

Karnataka ministers, including Home Minister G Parameshwara and Transport Minister Ramalinga Reddy, clarified that the guaranteed schemes will continue. "The party had extensively discussed the guarantees before announcing them. It is known that implementing the guarantees will be financially challenging, but we will manage," said Parameshwara.

Congress leader and former Rajya Sabha MP MV Rajeev Gowda, who lost in Bengaluru North, told Moneycontrol: “Guarantees are provided for people to cope with price hikes, unemployment, and to enable women's empowerment. The logic behind them is even valid today. It appears that people may have considered national issues in this parliamentary polls  and not voted based on guarantees."

What went wrong

The five poll guarantees implemented by the Congress government are: free travel for women across the state in non-AC state-run buses; 200 units of free power per month; Rs 2,000 per month for each female head of the family; 10 kg of food grains (rice, ragi, jowar, millet) per month to BPL (below poverty line) families; Rs 3,000 per month for two years to unemployed graduates; and Rs 1,500 per month for two years to unemployed diploma holders.

While these five guarantees benefits 5.10 crore people in the state, costing the exchequer Rs 36,000 crore in 2023-24, Siddaramaiah allocated Rs 52,009 crore for the schemes this fiscal year.

Siddaramaiah's revenue-deficit budget for 2024-25 — his 15th budget— has a total outlay of Rs 3,71,383 crore. With the deficit set at Rs 27,354 crore, this is probably the first time annual borrowings have exceeded Rs 1 lakh crore in a fiscal year. 

Also, read: Karnataka budget's puzzling question: Why has the govt cut capex by nearly 28 percent?

In fact, Congress party was banking on Siddaramaiah, who has presented a record number of state budgets and also maintained financial discipline, to implement these guarantees.

However, the government was not prepared for the severe drought that struck Karnataka in 2023-2024, affecting 226  of 236 taluks — one of the worst in the last 100 years. The state government sought assistance from the Centre and requested the release of Rs 18,171 crore. When no funds were forthcoming, state approached the Supreme Court. Following criticism from the apex court, the Centre released Rs 3,454 crore.

To generate additional revenue to fund guarantees, the state government increased guidance value of properties by 15-30 percent, imposed additional excise duty (AED) on Indian-made liquor (IML) by 20 percent on all slabs and AED on beer from 175 percent to 185 percent , imposed  3 percent additional cess on newly-registered transport vehicles, introduced a lifetime tax on EVs (electric vehicles) above Rs 25 lakh, and intensified tax collection.

Also, read: After five poll guarantees, Karnataka to hire private consultant to increase tax collection & plug leakages

However, a senior government official told Moneycontrol that some tweaks are required for the guarantee schemes. "When we focus more on social welfare schemes, we reduce the funds available for capital expenditure and developmental activities, which stimulate growth. Look at what happened to YSR Congress Party leader Jagan Mohan Reddy in Andhra Pradesh. He lost the assembly polls despite focussing on so many welfare schemes".

"For instance, 200 units of free power can be restricted to BPL families in Karnataka. Free bus travel should be limited to intra-city — not inter-city — rides. Rs 2,000 per month can be distributed to women who are part of self-help groups, like Kudumbashree in Kerala. In fact, despite popular schemes like Anna Bhagya during 2013-2018, Siddaramaiah lost the 2018 assembly polls," he added.

Guarantees failed in Karnataka: BJP

The BJP criticised the Congress guarantees, claiming they will affect state's development. BJP leader R Ashok said guarantees didn’t benefit the Congress in the LS elections, and added: "The government is bankrupt, no development is taking place."

BJP leader and Bengaluru South MP Tejasvi Surya told Moneycontrol: "The guarantees are the most irresponsible kind of economic vision the Congress has put into action in Karnataka. At least under pressure from Congress legislators, they must review this. The people have rejected it, it is clear from the election  results."

He pointed out that the state's capital expenditure had decreased while revenue expenditure had increased. "Budgetary allocation to departments like agriculture and irrigation have reduced. The state government has stopped providing the additional Rs 4,000 a year to farmers under the PM-Kisan scheme, which provides Rs 6,000 a year. Funds for SC/ST welfare and Bengaluru's development have also been cut. Many development projects across the state have been halted due to these guarantee schemes," he added.

Also, read: Karnataka: BJP-led NDA wins 19 seats and Congress in 9

Factors that helped BJP in the polls

Experts say several factors contributed to the BJP's performance in the recent LS polls in Karnataka, despite a drop in seats from 25 in 2019 to 17 in 2024. The party's resurgence under the new leadership of state BJP President BY Vijayendra, son of BS Yediyurappa, and the BJP-JD (S) alliance, which consolidated the Vokkaliga-Lingayat votes, particularly in the old Mysuru region, played a major role.

Additionally,  the Modi factor, strong candidates, and polarisation of votes, especially in coastal Karnataka, helped the BJP perform reasonably well. Many state Congress ministers refused to contest in the Lok Sabha polls, with some fielding their children or relatives instead, as they didn’t want to give up their ministerial posts.

Shastri, who is also a political scientist, said: “In the first phase of polls for 14 seats in South Karnataka, Congress managed to win only two, while BJP got 10, and its alliance partner JDS secured two. The Congress was hoping to do well in this region but fared badly, mainly due to the wrong choice of candidates. Ministers who should have contested decided to sit back and let others contest. In the first phase, the poor selection of candidates cost the Congress dearly, and the BJP was able to handle its internal problems much better.” He said Modi’s leadership and better candidate selection ultimately tilted the balance in favour of the BJP in Karnataka.

Also, read: Bengaluru Metro sees ridership and revenue surge despite free bus travel for women