12 May, 2022 12:32p.m.

Kerala considering employees salaries owing to financial crisis


Kerala state government employees' salaries are under threat due to the state's serious financial situation. The non-release of Rs 4,000 crore sought as a loan from the Centre has compounded the crisis. It has been learned that the finance department is considering a suggestion to set aside 10% of the salary. Finance Minister K.N. Balagopal, on the other hand, stated that salary postponement is not being considered at this time. Balagopal spoke forward.

The Treasury placed limits last month to guarantee that salaries are not halted. This month, limitations on withdrawals of more exceeding Rs 25 lakh are being implemented. More than one borrowing application has been submitted to the federal government since the beginning of the current fiscal year. As a result, the RBI has set aside Rs 4,000 crore in stages. However, the Centre has refused to allow borrowing.

The main point is that there is a mismatch in the figures for Kerala's debt in previous years. The Comptroller and Auditor General have ordered that any debt incurred by government agencies and public sector firms, including KIIFB, is to be considered government debt. But the state government has taken the stand that it cannot be included.

The Centre has demanded an explanation for the disparity in data as well as the additional borrowing approved during the Covid period. According to government officials, they have responded and are awaiting clearance to take out a loan. If the situation worsens, the decision has been made to interfere and find a solution.

Kerala's borrowing limit for the fiscal year has been set at Rs 32,425 crore by the central government. In early April, this is frequently allowed in instalments. The Reserve Bank of India issues debentures to fund these loans. Banks. This covers LIC loans, for example.

Kerala had planned to borrow Rs 1,000 crore on April 19, Rs 2,000 crore on May 2, and Rs 1,000 crore on May 10 according to the Reserve Bank's borrowing calendar. Even if it is on the calendar, central approval is necessary to borrow at that time.

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