MP's sops overdrive makes govt finances nose-dive

MP's sops overdrive makes govt finances nose-dive

For the first time in the Bharatiya Janata Party’s 15 years of uninterrupted rule, the state is facing ways and means condition. It means the Shivraj Singh government’s cash fund has dipped below the limit of Rs 600 crore set by the Reserve Bank of India. The government may have to seek overdraft if the chief minister doesn’t stop showering bonanzas on farmers and employees. This looks unlikely given the fact that assembly election in Madhya Pradesh is just four months away.

State’s Finance Minister Jayant Mallaiya admits that the state government is, indeed, facing ways and means condition. About seeking overdraft, he cryptically said, “Nothing can be said about future”.  

Effect of the financial crisis is already visible. A majority of the state’s nearly 4.25 lakh employees are still awaiting first instalment of the arrears of the Seventh Pay Commission, which was to be deposited in their accounts before May 31. Total arrears amount is around Rs 1,500 crore, which is to be deposited in the staff’s accounts in three equal instalments in May month in three years starting from 2018.

Finance department sources said despite a staggering debt of about Rs 1.75 lakh crore, state’s financial condition was manageable till a few months ago. Funds were pooled in for payment to farmers for procuring their crops by cutting budgetary expenditures of almost all the departments. Yet, the government fell short of funds and more money was borrowed from the market.

According to the chief minister, nearly Rs 30,000 crore reached farmers’ bank accounts in last one year. Chouhan has taken several populist measures and announced sops even as the Congress has been trying to portray the BJP government in Madhya Pradesh as anti-farmer.

Last month, the state cabinet declared a power subsidy package of Rs 510 crore for farmers and below poverty line domestic consumers.

Cong seeks details

Madhya Pradesh Congress Committee (MPCC) President Kamal Nath has demanded a white paper on the state’s financial condition, terming it “terrible”.

He sought to know how the chief minister will fulfill the over doze of promises he is making to the people of Madhya Pradesh when the state coffers is empty and the government is on the verge of seeking overdraft.

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