Shimla – As Himachal Pradesh grapples with a mounting debt crisis, Chief Minister Sukhvinder Singh Sukhu has announced that he, along with his ministers and chief parliamentary secretaries, will forgo their salaries and allowances for the next two months. The state’s debt has now crossed ₹90,000 crores, prompting the Chief Minister to call on all MLAs to voluntarily relinquish their salaries and allowances to aid the state in overcoming this financial crisis.
During the monsoon session of the Himachal Pradesh Legislative Assembly, CM Sukhu outlined the severe financial challenges the state is currently facing. He pointed to the discontinuation of GST compensation after June 2022 as a major factor contributing to the state’s revenue shortfall, with an estimated annual loss of ₹2,500 to ₹3,000 crores. Additionally, the restoration of the old pension scheme has further strained the state’s finances, reducing its borrowing capacity by approximately ₹2,000 crores.
Revenue Deficit Grant Reduced
The Chief Minister expressed concern over the reduction in the revenue deficit grant, which was ₹8,058 crores in the year 2023-24 but has been slashed to ₹6,258 crores this year, resulting in a shortfall of ₹1,800 crores. He warned that next year’s grant could decrease by another ₹3,000 crores, bringing it down to just ₹3,257 crores. This anticipated reduction adds to the financial strain, making it more challenging for the state to manage its obligations.
Lack of Central Government Support
CM Sukhu also highlighted the lack of financial assistance from the central government, particularly in the aftermath of recent natural disasters. The state urgently needs ₹9,042 crores for post-disaster recovery, but these funds have not yet been provided. Additionally, Himachal Pradesh is still awaiting approximately ₹9,200 crores from the Pension Fund Regulatory and Development Authority under the National Pension System. The state’s debt burden includes ₹9,000 crores in employee liabilities, further complicating its fiscal situation.
However, the Chief Minister’s call for salary sacrifices has not gone unchallenged. Opposition leader Jairam Thakur questioned the sincerity of the move, suggesting that the decision might be more about delaying payments rather than waiving them altogether. Thakur argued that a more effective approach would be to reduce wasteful expenditures by cutting down on the number of Chief Parliamentary Secretaries, cabinet ranks, and corporation boards. He accused the Congress government of failing to manage the state’s finances effectively, thereby worsening the economic situation.
