Government officials said efforts were underway to curb non-essential expenditure and improve fiscal management without affecting welfare programmes and development projects.

"The government is focusing on digital modes of communication. If tender notifications, land acquisition notices and other public advertisements are increasingly published online, substantial public funds can be saved," a senior official said.

According to the interim budget presented by the previous government, Tamil Nadu plans to borrow Rs 1.79 lakh crore during the 2026-27 financial year and repay Rs 60,413 crore, taking the State's outstanding debt to an estimated Rs 10.71 lakh crore.

Officials noted that the figure includes Rs 9,522 crore related to the Chennai Metro Rail Phase-II project. Excluding that component, the outstanding debt is estimated at around Rs 10.62 lakh crore.

The financial situation has also raised questions about the implementation timeline of several welfare promises announced by the ruling Tamilaga Vettri Kazhagam (TVK) during the Assembly election campaign.

So far, the government has announced free electricity up to 200 units for eligible domestic consumers using less than 500 units.

However, several other promises, including six free LPG cylinders annually, eight grams of gold and a silk saree for poor brides, annual assistance of Rs. 15,000 per mother to prevent school dropouts, and monthly financial assistance of Rs 2,500 for women below the age of 60, are yet to be implemented.

Finance Department officials said the government would explain the status of these welfare schemes along with a proposed White Paper on the State's finances before the presentation of the full Budget.