Cash-starved Punjab is planning a shopping spree. After borrowing a staggering Rs 1,737.14 crore from various banks this year, the Punjab government’s coffers are empty again. Unable to release funds for midday meals in schools because of want of money, the state, however, is planning to purchase a Rs 70-crore aircraft—a plan which could be shelved—and two Rs 7-crore bullet-proof BMWs for the Chief Minister and his deputy. The state has already spent Rs 38 crore in March on a helicopter for the exclusive use of the two.
Though the Rs 1,737.14 crore loan was mainly used to pay pending salaries, the government has not paid medical reimbursements, gratuity, provident fund and all other benefits (a total of Rs 5,168 crore for the state exchequer) to its four lakh employees since June this year.
The midday meal scheme (that covers 21 lakh schoolchildren) seems to be on verge of closure. The state government has not released funds for midday meals in government and government-aided schools after July. Under this scheme, 75 per cent of the funds are provided by the central government and 25 per cent (Rs 50.82 crore) by state government. The funds released by the Centre and the state’s share have been diverted to other departments, say sources. The education department had recently asked schools to make their own arrangements for midday meals. However, principal secretary of education, Anjali Bhawra, said the District Education Officers have been instructed to provide midday meals in all schools and Rs 70 crore was being released for the scheme.
The 2,700 petrol pump owners in the state have issued threats of not refilling government vehicles as fuel bills of more than Rs 4 crore have not been cleared. The government owes around Rs 1 crore to Chandigarh Industrial and Tourism Development Corporation (CITCO) and has not cleared their bills for the last six months. The Director-General of Police has to clear a bill of Rs 35.63 lakh, the revenue department owes Rs 4.46 lakh and other departments owe Rs 11.83 lakh to CITCO alone.
Welfare schemes have also been affected. Around 35,000 cases of the shagun scheme (where Rs 15,000 is provided for the wedding of girls from economically weaker section) are pending. The government is yet to release Rs 7 crore for the scheme. Close to 12,956 cases are pending for 2009-10, 9,800 for 2010-11 and 5,811 for 2012-13 and 6,000 beneficiaries have still not received the money.
The financial crisis started after major banks refused to lend more money as Punjab has already exhausted its borrowing limit. The government then asked Punjab Urban Development and Planning Authority (PUDA) to raise Rs 1,000 crore as loan by mortgaging its properties last month. However, Punjab Finance Minister Parminder Singh Dhinsa said there was no need to panic as the state experiences a lean revenue period from July to September.