Thiruvananthapuram: Taking exception to off-budget borrowings to pay social welfare pensions, the Comptroller and Auditor General (CAG) of India has asked the government to bring the accounts under the budget.
The CAG red-flagged the borrowings made by the Kerala Social Security Pension Limited (KSSPL) in its report on the state's finances tabled in the legislative Assembly on Friday.
The report has also criticised the Kerala Infrastructure Investment Fund Board (KIIFB) for taking off-budget route to raise funds.
The CAG pointed out the 'wrong trend' of KSSPL borrowing Rs 6,843 crore in 2019-20 outside the budget, and asked the government to make corrective steps to bring it under the State budget.
The KSSPL's borrowings during the period was three times more than the Rs 1,930 crore KIIFB had borrowed. KSSPL was founded in 2018 to borrow money from other government institutions and banks whenever the treasury could not disburse welfare and social welfare pensions. The borrowings are made under government guarantee.
The CAG asked to include the KSSPL borrowings in the budget since the loans are available on government guarantee, and the company has been taking up the government's liability to disburse pensions.
The state government, however, viewed the CAG's stand as politically motivated. The KSSPL borrowings ensured pension to about 60 lakh people. It also pointed out that the central government, too, has been raising such funds, and clarified that KSSPL would not be shut down.