Kerala to restrict expenditure for another year amid severe financial crisis

Thiruvananthapuram: Due to the persistent financial crisis, the state has decided to extend the strict controls on expenditure for an additional year. The finance department has issued an order outlining the extension of restrictions. As per the order, limitations on activities such as the renovation of government buildings, procurement of furniture for government institutions and offices, and the purchase of new vehicles have been prolonged for one more year. Rabindra Kumar Agarwal, Principal Secretary of Finance, issued the directive, and it is applicable not only to government offices but also to universities and Public Service Commissions (PSCs). This move reflects the government's ongoing efforts to manage financial resources judiciously in the face of economic challenges.

Meanwhile, the Chief Secretary of Kerala Dr V Venu informed the High Court on Wednesday (Nov 8) that the state is under financial crisis and therefore could not allocate money for the distribution of pensions in KSRTC. The Chief Secretary appeared before the court via video conferencing and said that it is difficult to find money even for day-to-day activities. The High Court directed the CS and the KSRTC MD to appear in the court. The court categorically stated that importance should be given not to celebrations but to the problems of human life. The court also said that human difficulties should be given more importance than celebrations like Keraleeyam. 

A week before, the ruling Left government told the High Court that the state was facing a 'huge financial crisis'. The government made the claim in an affidavit that was submitted to the court in connection with a case involving paying back a depositor of Kerala Transport Development Finance Corporation (KTDFC) Ltd.
"Our state is now passing through a phase of financial constraints. Any monetary benefit has to be allowed within the financial resources available with the government," the government contended.

In their statement, the state further stated that in order to resolve their financial difficulties, the Kerala State Road Transport Corporation (KSRTC) and the KTDFC may mortgage the property or sell one or more of its assets to outside parties or governmental organizations. The government further stated that it had given KSRTC Rs 8,440.02 crore for various expenses from 2018-19 to October 15, 2023, despite being in the midst of a severe financial crisis.

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