Punjab Govt Faces Grim Fiscal Scenario, Salaries Delayed
The situation appears to be bad with the opposition party Congress demanding imposition of financial emergency in the state that had voted the coalition for the second term last year.
The state government on its part attributed the state's "weak" fiscal situation to low revenue growth due to slowdown in economy.
The state government staff claimed their salaries had been delayed beyond a month while government-aided school teachers have also claimed non-payment of their salaries for the last six months.
"We have not been paid salary for the past six months despite the state education department having given its approval for payment. The finance department has stopped the release of payment which is worked out at Rs 60-70 crore," Government Aided School Teachers & Other Employees Union (Punjab), President, Gurcharan Singh Chahal claimed.
"It has been very tough for 4,200 teachers, principals and other non-teaching employees who have been without salary for such a long time," he said while announcing that a state-wide agitation against Punjab Education Minister Sikander Singh Maluka would be launched on October 9.
Punjab Finance Minister Parminder Singh Dhindsa ascribed the current fiscal health to low revenue growth in the first quarter of this fiscal, saying the situation would improve in the following quarters.
"Our fiscal situation is not as bad as is being projected...Yes, there is a slow growth in revenue but our revenue growth is at 10 per cent and better than Haryana's tax revenue growth of 5 per cent," Dhindsa said.
Asked about transferring government properties to PUDA under Optimum Utilisation of Vacant Government Land Scheme for raising resources, he said the money generated from it would be spent on capital expenditure only.
"We will spend the money raised from it on capital expenditure only..We have funds for payment of salaries and wages", he said.
Employees under the banner of Punjab Civil Secretariat Staff Association claimed they are not getting salaries on time. The salaries are being disbursed in the first week of the following month.
"There was a delay in release of salary for 4 to 5 days for the month of August," said Association's President Paramdeep Singh.
Punjab government has also not paid eight per cent Dearness Allowance from January one this year and pay arrears instalment for the period between January 2006 and July 2009 to its employees and pensioners.
"The bureaucrats, including IAS, IPS officers have been given DA, but we have not been paid..Why is there discrimination in payment of DA"? said Singh.
Punjab's salary and wages bill sharply shot up from Rs 6,438 crore in 2007-08 when the SAD-BJP government came to power to Rs 15,184 crore (projected) for 2013-14.
It is not only salary and wages. Punjab government has also not been paying Value Added Tax (VAT) refunds to the state industry for the past several months, industry representatives claimed.
"Though Punjab Excise and Taxation department claims less, but as per our estimates, VAT refunds to the tune of Rs 1,000 crore has been pending with the department," said Federation of Associations of Small Industries of India, National President, Badish Jindal.
Fuel pump owners are also resenting about non-payment of their bills by the state government to the tune of Rs 4 crore.
"Our fuel bills to the tune of Rs 4 crore have been pending for the past six months despite raising this issue at the appropriate levels numerous times," said Punjab Petroleum Dealers' Association President J P Khanna.
Several government departments, including police, district administration and even Punjab Excise and Taxation department, owe to fuel pump owners.
"The fiscal situation of government departments is so bad that if we do not refill the fuel the tank of state government's vehicles, state officials cannot reach their offices in time," Khanna said while alleging that fuel pump owners sometimes had to refill government vehicles under duress.
Punjab government has also not been able to honour its election promise of giving free tablets to 1.50 lakh students and employment allowance of Rs 1,000 per month so far.
According to RBI's latest report on the state's cash management, Punjab figured among the five states which claimed overdraft in current fiscal.
Till August 5 this fiscal, Punjab availed overdraft for maximum number of days at 37, followed by Nagaland at 35 days, West Bengal at 9 days, Manipur at 8 days and Mizoram at 5 days.
Moreover, Punjab availed Special Ways and Means Advances (WMA) and normal WMA for 74 days each which is also one of highest number of days, in current fiscal so far. RBI allows states to tide over their temporary mismatch in cash flow through WMA mechanism.
Though Punjab government accused the Centre of being responsible for the "fiscal crisis" alleging step motherly treatment meted out to the state, the state's total outstanding debt is projected to cross a whopping Rs 1 lakh crore mark in current fiscal.
Punjab's outstanding debt, including reserve funds, went up from Rs 55,982 crore in 2007-08 to Rs 1,02,282 crore (Budget Estimates) in 2013-14 with Punjab unit of Congress accusing the state government of resorting to reckless borrowings for payment of debt and salaries bill.
Punjab along with West Bengal and Kerala, had been identified as a debt-stressed state by the 13th Finance Commission.
With the state's revenue receipts consistently being short of revenue expenditure, Punjab has not been able to bring down its revenue deficit as per financial consolidation path recommended by the 13th Finance Commission.
Against the target of 1.8 per cent and 1.2 per cent for 2011-12 and 2012-13, the state recorded revenue deficit as per centage of GSDP at 2.63 per cent and 1.61 per cent respectively.
Accusing the SAD-BJP government of leading the state to bankruptcy, Congress had asked the Centre to declare financial emergency in the state and also sought a white paper on the state's fiscal health.
Union Information and Broadcasting Minister Manish Tewari said that during the last six years, the Punjab economy had gone "from bad to worse" and people at the helm of affairs here had proved beyond doubt that they were not capable of managing the state's economy".
"Rs one lakh crores debt is too difficult to explain," he remarked and alleged that during the last six years "all norms of economic management have been violated and thrown to winds and the results are before everybody to see".
Tewari, who is also Congress MP from Ludhiana, said never has it happened that the state government had to mortgage its buildings to generate loans for paying salaries to its employees, a charge denied by Punjab government.
Asking the state government to issue a white paper as to what went wrong, he said, the people of Punjab have a right to know and the state government owed an explanation to them.
The Minister wondered why was the state was "running away" from debating and discussing the issue.
"Just by going on in denial mode and claiming all was well with the economy does not make the economy well," he said while adding the governments with healthy economies do not mortgage their properties for paying salaries to their employees.
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