Thiruvananthapuram: A white paper on Kerala’s finances published by the Opposition United Democratic Front (UDF) blamed the Left Democratic Front Government for plunging the state into ‘severe financial crisis’.
The Left Government failed miserably in realization of taxes in the last five years and caused the exchequer a loss of Rs 70,000 crore, states the white paper.
While the actual tax amount collected in 2016-17 fell short of the target by a whopping Rs 5,437.23 crore, there was a shortfall to the tune of Rs 13,492.79 crore in 2021-22. The development activities funded through borrowings should yield returns in the future to enable the authorities in repaying the loans. However, the huge borrowings availed by the Pinarayi Vijayan Government have left the state in a dangerous debt trap, the white paper charged.
Much of the borrowed money was used to meet day-to-day expenses. This means the steep rise in total expenditure is not due to developmental expenses for the future but non-developmental ones with no scope for any returns. This year too, there is a possibility of the developmental expense share further sliding down, it blamed.
(A white paper is an authoritative or official report that lays bare the issues and suggests measures to solve them.)
'Faulty GST rollout, note ban'
The white paper, which faulted the state government for not making proper arrangements for tax collection while implementing the GST (Goods and Services Tax), goes on to blame the Centre for the manner of GST implementation and its decision to ban high-value currencies.
Per capita debt doubles in five years
The UDF white paper on the state’s finances says that the per capita debt of Kerala has gone up over double in five years. Till 2016, the total debt of the state was Rs 1,57,370 crore. In the past five years, it has gone up to Rs 333,592 crore. The per capita debt of Malayali which was Rs 46,078.04 has now shot up to Rs 105,000.
As per the 2022-23 Budget estimate, the total debt of the State would go up to Rs 371,692.19 crore. If Rs 13,000 crore in KIIFB repayment and Rs 7,800 crore for social welfare pensions are also included, the total debt of Kerala will further increase to Rs 400,000 crore.
The government had said that the majority of the projects announced in the Budget will be implemented through KIIFB. So far clearance has been given for spending Rs 73,908 for 962 projects.
The loan that KIIFB has taken until 2021-22 is Rs 13,468.44 crore. The government has given Rs 10,135 crore to KIIFB from collections under various heads, including petroleum cess and motor vehicle tax. A total sum of Rs 23,604.29 crore was received by KIIFB as loan and government aid. It spent up to Rs 20,184.54 crore until June 2022 and it holds Rs 3,419.75 crore as balance.
The white paper asks how KIIFB will be able to implement projects worth Rs 50,000 crore with this above said money in its kitty.
A Financial Planning subcommittee of the UDF, headed by C P John, prepared the white paper on the basis of documents such as Assembly questions and answers, replies under the Right to Information Act, and reports of the Comptroller and Auditor General (CAG).
The document, prepared ahead of the February 3 budget presentation by Finance Minister K N Balagopal, was officially released by Opposition leader V D Satheesan by handing over a copy to Muslim League leader P K Kunhalikutty in the presence of UDF Convenor M M Hassan.
Debt has been mounting dangerously and what was happening now had been prophesied by the white paper of the UDF in 2020, Satheesan said.
Deputy Leader of the Opposition P K Kunhalikutty said that even the ruling front MLAs are complaining that no project is getting implemented in their constituencies and the crisis that plagues KSRTC is spreading to other firms as well.