Date:05/07/2009 URL: http://www.thehindu.com/2009/07/05/stories/2009070554080500.htm

Other States - Punjab

A tough task for Badal

Facing huge expenditure due to pay hikes, arrears
71 % of revenue receipts consumed by salary, pension

Chandigarh: Amid rising debt, mounting pay revision liabilities, inflating subsidies and ballooning deficits, Punjab Finance Minister Manpreet Singh Badal has a tough task at hand to consider all this while presenting his third budget on July 7.

An analysis of the State’s finances show that this year the Government is faced with huge expenditure arising on account of pay hikes in accordance with the Sixth Pay Commission’s recommendations.

Punjab has projected annual liability of Rs 3,000 crore as payment of additional salaries and Rs 4,800 crore as payment of arrears.

Also, it is a cause of concern that almost 71 per cent of the total revenue receipts of the Government are consumed by salary, pension, interest and subsidy, leaving less resources for social and economic services.

The State’s revenue deficit surged from Rs 1,241 crore in 2005-06 to Rs 3,823 crore in 2007-08. -- PTI