The State government will have to source about ₹1,750 crore by October 1 to clear the second instalment of the enhanced salary and pension arrears due to about five-lakh employees and 3.5 lakh service pensioners as per the Tenth Pay Commission recommendations.
The additional burden comes at a time when a shortfall of about ₹500 crore has been recorded in the tax collection under the new Goods and Service Tax (GST) regime. As per official estimates, the State GST (SGST) collection on August 28 has been pegged at ₹251 crore and Integrated Goods and Services Tax (IGST) ₹451 crore. Against the ₹1,232 crore mopped up under the new tax administration, it would have at least touched ₹1,600 crore under the Value Added Tax system during festival seasons such as Onam, sources said.
Concerted efforts to streamline the planning process in local self-government institutions and other sectors had also started yielding the desired results and the fund absorption rate had registered a remarkable increase, compared to the previous years. This would add to the outgo from the treasury in the coming months.
When the Pay Revision Commission submitted its recommendations, the previous government had decided to space the disbursal of arrears into four instalments and the onus thus came on the Left Democratic Front government.
As per the decision, the first instalment was due on April 1 and it has been cleared. The third and fourth instalments fall on April 1 and October 1, 2018. On clearing the first component, the arrears due to service pensioners were paid in cash and that of employees merged into their PF with interest.
But for the strain incurred by the introduction of GST, the current fiscal situation did not leave any room for concern and channels had already been identified for meeting the cash requirements next month.
