THIRUVANANTHAPURAM: Having burnt through nearly Rs 15,000 crore during the Onam season, the Kerala government is now looking at other sources to generate funds to manage the expenses for the rest of the month.
It is learnt that the government may opt for the overdraft facility to raise the money. Sources said the money was spent on salary and pension, social security pension and other welfare measures, among others, during Onam season. However, they said there was a fiscal strain, not a financial crisis, and there was no need for fresh curbs on the treasury.
“There is a fiscal strain, not a crisis. Utilising options like ways and means and overdraft are common for a government when the spending is high. The higher outgo due to last year’s revision in salary and pension coupled with the shortage in central funds are reasons for the current strain. The government did not cut down on welfare expenditure during Onam,” said a highly-placed source in the finance department. The source said there was no immediate need for fresh curbs on the treasury payments.
At present, there is already a restriction in treasuries on payments above Rs 25 lakh. Such transactions require special clearance from the finance department. The state has availed of Rs 4,000 crore worth market borrowings so far.
Finance Minister K N Balagopal had earlier said the state will face a shortage of Rs 23,000 crore in the fund flow from the Centre this fiscal, as the Union government has adjusted Rs 14,000 crore worth off-budget borrowings in the net borrowing ceiling of the state, besides effecting a cut in Kerala’s revenue deficit grant and stopping distribution of GST compensation to states.