Acute liquidity crunch is likely to derail salary and pension disbursal in the New Year too.
Functioning of the district and sub-treasuries, mostly in the Malabar region as well as the rural areas of the State are likely to go haywire from January 1, 2017. The cash requirement for January for footing the salary and pension bills is almost the same as in December, but the Reserve Bank of India does not have sufficient currency at its disposal to replenish the stock in treasuries and banks.
Finance Department sources told The Hindu here that it has almost become sure that the present cash shortage would prevail in January, 2017, to and the treasuries may not be able to honour the ₹24,000 withdrawal limit on the pay day.
Officers of the RBI regional office who had a meeting with Finance Secretary K.M. Abraham here to review the preparedness for meeting the cash demand during the first week of January are understood to have explicitly said that the bank may not have enough currency to meet the government’s requirement.
Against the ₹1,391 crore sought for meeting the expenditure for the first 10 days of the month, the bank would be able to provide only ₹600 crore and that would be too inadequate to meet the committed expenditure.
In addition, the government had sought ₹506 crore for disbursing the welfare pensions worth ₹1,055 crore for 33.58 lakh beneficiaries between December 26 and 31.
The sharp decline in Sales Tax revenue in December is being cited as a pointer to the financial crisis that is gripping the State. Compared to the revenue returns in December 2015, the sales tax collection has recorded a negative growth of 8.2 per cent this month. The same is applicable, even in a greater extent, in the case of the revenue from land registration and also from the Kerala State Beverages Corporation.
Compared to December, the number of treasuries that are likely to go dry or may not receive any imprest fund on the first day, would be much higher on January 1.
In order to mitigate the woes of customers, treasury officials were told to provide details of cash availability in all treasuries so that even if one treasury goes dry, customers may be able to move to another one in the vicinity for payment. The current cash crunch does offer such leeway anymore, sources said.
