The State government may explore different options for repaying the deferred salary of employees and teachers once the strain on State’s finances eases post COVID-19.
The decision to defer six days’ salary will help fetch only ₹500 crore and that would not help to reduce the stress for mopping up ₹2,450 crore needed for meeting the salary bill every month. The tax revenue collection this month is below ₹500 crore.
The government may either transfer the deferred salary to the Provident Fund (PF) account in full or disburse the allowances in cash and the basic salary alone to the account. Such options would be considered only after the fiscal situation improves. The given circumstances do not offer any clue of an economy revival for at least the next six months. Which means that the repayment of deferred salary would be taken up only once the State’s own tax and non-tax revenue collection bounce back to normality.
Finance Minister T.M. Thomas Isaac reiterated here on Saturday that the government would not yield to pressure from service organisations and rescind the order to deduct the salary as scheduled.
Compared to other States, Kerala had been much liberal and never opted for a pay cut. This is being contrasted with the Centre’s decision to freeze the sanctioned dearness allowance of its employees, the arrears and also two more tranches that are due in the coming months.
The protest by a section of employees by burning copies of the order to defer the salary had drawn flak. Such protests are being staged at a time when legions of labourers in organised and unorganised sectors are left in the lurch and facing abject penury. Dr. Isaac and Chief Minister Pinarayi Vijayan took strong exception to protest.
The government will have to borrow heavily to pay the salary in May. It has limited options but exhausting it all to avert protests. If the situation fails to improve by June, all calculations may go awry and salary and pension disbursal may grind to a halt, sources said.
