As election year draws, financial woes mount for Dhumal government

Shimla: With borrowing limits of the state curtailed by the central government, losses in public sector undertakings mounting and pay arrears of employees and pensioners still to be cleared, the state government headed into election year is finding the going tough.

Though chief minister Prem Kumar Dhumal recently declared that for Diwali the government intended to release Rs 311Cr of pay arrears to employees and pensioners, it still has a bill of Rs 845 Cr on the account standing and has to be paid if goodwill of a dominant section of society is to be retained.

“It is ironic,” says Geeta, a government employee, “that pay arrears of IAS and IPS officers stand cleared so do that of Class IV employees but others are demanding their dues and the government is only dilly-dallying by releasing them in piece meal manner.”

With an outstanding total loan liabilities on the state crossing Rs 24,745 Cr as in June, 2011 and the central government restricting current financial years borrowing at Rs 1647 Cr, the state government has been struggling to make ends meet.

Despite constant monitoring of the states 25 PSU’s functioning, yearly losses continue to increase. In 2007-08 the PSU losses were Rs 71.77 Cr, in 2008-09 they dropped to Rs 12.85 Cr and climbed back in 2009-10 to Rs 194.22 Cr, finance department papers revealed.

With the state laying the blame for skewed financials at the 13th Finance Commission recommendations that estimated higher revenues and projected lower expenditures, the government has asked the central government for an extra Rs 5400 crores, to overcome the hiccup.

Principal Secretary Finance Srikant Baldi said, “our chief minister did write to the Prime Minister Manmohan Singh, again in August, pointing out the anomaly. As of now the PMO has only acknowledged receiving the states letter,” he added

Assembly election in Himachal is due in October-November 2012 but with speculation rife that the BJP government could call for an early poll to coincide with the Punjab and Uttarakand assembly elections, a senior official in the planning department, on conditions of anonymity said, “should that happen the government would like to release pay arrears before elections are called, and that could land the state in a overdraft situation.”

However, Baldi said, “a decision for releasing the remaining arrear of employees is yet to be taken.”

Leave a comment

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.