A totally drained Treasury is forcing the Congress-led UDF Government to place the State under a virtual financial emergency just when the people are preparing to celebrate the Onam festival but the CPI(M)-led lDF, which had left power in 2011 with a relatively rich treasury, has alleged that the State is facing absolute financial anarchy under the UDF.
The Department of Finance has already given instructions for stringent controls on expenses in order to circumvent the grave financial crisis. The department is planning to suspend all non-profitable projects for the next two years, according to sources. Works contractors in the public sector are already up in arms against non-payment for their completed projects.
A blanket freeze on public appointments, termination of service of excess temporary employees or their redeployment, etc are the other plans the Finance Department is mulling, according to sources. Heads of various departments have already been asked to report the number of excess hands under them. There are about 30,000 temporary employees in Government sector in Kerala.
Sources say that non-plan expenditure has skyrocketed in the State just when there has been a huge failure in meeting the target of tax collection. The situation is so critical that the Government is now reportedly planning to raise Rs5,000 crore debt to meet Onam expenses.
Sources in the Government say that Finance Minister KM Mani has imposed strict controls on allotting money to various departments and public sector companies. The Kerala State Road Transport Corporation is going through a terrible financial crisis but Mani is refusing to give any assistance to it.
Meanwhile, former Finance minister TM Thomas Isaac, central committee member of the CPI(M), has alleged that the UDF Government has taken the State into total financial anarchy. The State Government had taken loans worth Rs4,400 crore till August though the amount spent on projects had been a mere Rs749 crore.
Isaac said that only 4.3 per cent of the annual plan allocation had been spent in the first five months of the year. The panchayats and municipalities in the State had spent only 2.6 per cent of their allocation so far, he said.