Thiruvananthapuram: Kerala Finance Minister Thomas Isaac has said that the government will disburse the next month's pension and salary from August 20 and 24, respectively, ahead of the Onam festival.

The minister also explained that the treasury would go into overdraft as Rs 6,000 crore would have to be spent in two weeks.

The government plans to disburse salary, pension, Rs 4000 bonus, festival allowance, and the salary advance of Rs 15,000 each within the next two weeks. The government also needs to locate Rs 2,000 crore to disburse the two-month welfare pension of Rs 2,600 each to 58 lakh beneficiaries.

Free Onam kits will also be distributed in addition to this. Around Rs 6,000 crore will be spent from the treasury within two weeks for all this, the minister said. And the treasury is likely to go into an overdraft of Rs 2,500 crore.

The Finance Minister is hopeful that the expenditure would be within this limit.

Rs 4,000 bonus

The government has issued orders, sanctioning bonus and festival allowance for the government employees. Those with salaries up to Rs 27,360 will be given a bonus of Rs 4,000. Those who are not eligible for a bonus will be given Rs 2,750 festival allowance. Also, Rs 15,000 would be sanctioned as Onam advance.

Move to avoid market slump

The government opted for the early disbursal of the salary and other benefits to ensure that the public had money to spend during the festive season and prevent the market from going into a slump.

Else the market would be affected during Onam this year too, the government evaluates. Thiruvonam falls on August 31.

The state government has already utilised the borrowings permitted till the December quarter of this financial year. Only by availing the 0.5 per cent borrowings extended by the Centre unconditionally, can the State repay the overdraft.

As per the Fiscal Responsibility and Budget Management Act, the borrowing limit for the state is only 3 per cent. If additional borrowings have to be made, then a Bill has to be passed.

Since the Kerala Assembly is being convened only for a day on August 24, it would not be possible to pass the Bill, the minister said. Hence, after the Assembly session, an ordinance would be issued and more borrowings made.