Restrictions on passing bills eased as treasury gets replenished

Finance Minister KN Balagopal. File Photo: Manorama Online

The state’s treasury, which has been grappling with a severe financial crisis, has experienced relief as funds have flowed in through fuel taxes and dividends from the Beverages Corporation. Following an expenditure of Rs 3,500 crore for the payment of salary and pension at the beginning of the month, all other outlays were temporarily suspended.

Typically, half of the government's monthly spending occurs in the initial two weeks. But there were no constraints on retirement benefit payouts and provident fund withdrawals last week. To meet the expenses, the government took recourse to an overdraft of Rs 2,000 crore. However, by Friday, the Treasury had managed to eliminate the need for an overdraft.

An amount of Rs 1,600 crore, sourced from fuel taxes and dividends from the Beverages Corporation, reached the Treasury. Other establishments also contributed to the Treasury's income. According to sources in the Finance Department, treasuries can now approve bills below Rs 1 lakh as of Monday.

The government had imposed restrictions on bills exceeding Rs 5 lakh four and a half months ago. But the oral directive given to treasuries was not to approve bills above Rs 1 lakh without the Finance Department’s permission. However, even bills approved by the Finance Department were not passed last week.

Finance Minister KN Balagopal, who returned to the capital during a break in the Nava Kerala Sadas following the demise of CPI leader Kanam Rajendran, held discussions with officials regarding the financial situation.

No bar on salary payments
Despite the financial crisis, salary and pension disbursements will remain unaffected. The primary cause of the current financial turmoil is the non-cooperation of the central government. The state has made significant progress in generating income, including taxes. It is expected that the state will be able to meet the year-end expenses using its resources, Finance Minister KN Balagopal told Manorama.

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