Kerala govt’s perilous politics of populism
Legislators and ministers in Kerala have been promised a pay hike. Every family in the state is to get an Onam gift hamper—at the cost of Rs 425 crore to the exchequer. If the largesse points to a fiscal surplus, think again. Only last week, finance minister KN Balagopal informed the assembly that the estimated revenue shortfall this fiscal is a whopping Rs 23,000 crore. The account is in the red owing to a lowered net borrowing ceiling, withdrawal of GST compensation and the cut in revenue deficit grant.
This is over and above the already existing debt burden. The state may need at least Rs 8,000 crore for paying salary, pension, and welfare pension ahead of Onam in the first week of September. The distribution of salaries and pensions to the employees of the state-owned public transport company, KSRTC, has been in disarray for the last few months. Social security pension to certain sections is pending. Contractors are running from pillar to post to get their bills cleared.
In such a dire economic atmosphere, the cabinet appointed a commission to recommend a wage hike for MLAs and ministers. The fact that the last pay revision was effected only four years ago and floods and the Covid pandemic marred the years that followed makes the decision all the more improper. Chief Minister Pinarayi Vijayan’s promise of Onam kits to all is another example of politics of populism at the cost of financial health.
When the sensible thing to do is to tighten purse strings and adopt stringent austerity measures, the government has been busy either denying the existence of a crisis or blaming the Centre for all the ills. A government that has to keep borrowing to pay salaries, pension, and even interest on loans cannot afford the luxury of indulging in populism. Politics that can push the state into penury is dangerous. The government must push politics and populism aside if it is concerned about the people’s welfare. It has to cut expenses and mobilise additional sources of revenue urgently.