Punjab largesse


It takes an election year to fast-track the fulfilment of long-pending promises and resolution of ticklish financial issues, no matter how cash-strapped the government may be. Over five years after it was set up, Punjab’s 6th Pay Commission has submitted its report to the Chief Minister, recommending an over two-fold increase in salaries of all state government employees, and a hike in minimum pay from Rs 6,950 to Rs 18,000 per month with retrospective effect from January 1, 2016. The finance department will vet the report before sending it to the state cabinet. The government is expected to go all out to meet its deadline of implementing the report from July 1.

The commission’s recommendations, which cater to about seven lakh employees and pensioners, are likely to lead to an additional expenditure of Rs 3,500 crore per annum from 2016. In its Budget presented in March this year, the government had earmarked Rs 9,000 crore for the purpose. Such a bonanza amid the devastating second wave of the pandemic sounds too good to be true, but with Punjab going to the polls early next year, the temptation to ‘beg, borrow or steal’ to release the payments would be irresistible for the ruling party. The big question: where will the money come from? Will the state, whose debt burden is expected to reach Rs 2,73,703 crore by March 2022, take the all-too-familiar loan route to woo this important section of the electorate?

The state is in for tougher times as GST compensation from the Centre is slated to end from next year. Revenue generation will be a huge challenge in the coming months in view of the disruptions caused by repeated lockdowns and curfews. Successive governments in Punjab have given fiscal prudence the go-by so as not to displease the farming community and other vote banks. The tradition of living beyond one’s means is set to continue, so what if the state inevitably sinks deeper into the debt quagmire.



Be the first to comment on "Punjab largesse"

Leave a comment

Your email address will not be published.


*


%d bloggers like this: