How Was the Money Spent? (2021–2026)
The government spent a total of ₹18.44 lakh crore over 5 years. This is more than the ₹18.11 lakh crore it received. The difference was covered by even more borrowing.
Where the Money Went (5-Year Total)
Over **70% of all spending** went toward recurring costs like salaries, pensions, and interest. Only a small portion was left to build new things for the future.
The 5-Year Yearly Spending Trend
Spending has increased every year. But the biggest jump is in **Interest Payments**, which grew by 60% in just 5 years as the debt piled up.
The Big Three: Salaries, Pensions, and Interest
These are called 'Committed Expenditure.' The government HAS to pay these first. Every year, they swallow most of the budget.
01
In 2025-26, these three items alone cost **₹1,67,450 crore**.
02
That is **52% of the entire state budget**.
03
For every ₹1 the government earns from its own taxes, it spends **₹0.76** just on these three things.
Capital Outlay: Building for the Future
This is 'Good Spending.' It's money used to build roads, bridges, irrigation, and schools that help the economy grow for years.
Total spent in 5 years: ₹2,12,300 crore.
As a % of the economy (GSDP), this has stayed low — around **1.8% to 2.1%**.
Comparison: Fast-growing states like Uttar Pradesh or Gujarat often spend **3% to 4%** of their GSDP on building assets.
Because so much money goes to daily bills and interest, there isn't enough left to build the mega-infrastructure Tamil Nadu needs to become a $1 Trillion economy.
Subsidies and Welfare: The 'Free' Cost
Tamil Nadu is famous for its welfare schemes (Free bus for women, Breakfast scheme, Monthly grant for women, etc.).
Annual subsidy cost: Increased from ₹26,500 crore (2021) to **₹42,100 crore** (2026).
While these help many people, they are currently funded by **borrowing money** rather than using surplus revenue.
The electricity subsidy (TANGEDCO) alone takes nearly **₹18,000 crore** every year from the budget.