Shimla, Sep 4 (UNI) Himachal Pradesh Chief Minister Sukhvinder Singh Sukhu on Wednesday defended the government's decision to delay payment of salaries and pensions by a few days each month as a fiscally prudent measure and asserted that the state’s finances are under control with the government working to become debt-free by 2027.

Addressing the Legislative Assembly, Sukhu emphasized that this deferral would save the state an estimated Rs 36 crore annually, reducing the burden of borrowing.

Sukhu clarified that the government's move to defer employee salaries to the 5th and pensions to the 10th of each month is aimed at managing the state’s finances more effectively. The decision stems from the timing of the central government's remittance of the Rs 520 Cr as Revenue Deficit Grant (RDG) and Rs 740 Cr as share in Central Taxes respectively released on 6th and 10th of each month.

The Chief Minister highlighted that paying salaries and pensions on the first of every month would necessitate borrowing Rs 40 crore at a 7.5% interest rate, incurring an additional Rs 36 crore in interest annually.

By adjusting the payment dates, the government intends to avoid this financial strain, ensuring better fiscal management without compromising on the timely disbursement of salaries and pensions, he said.

Sukhu assured the Assembly that the decision is not indicative of a financial crisis but a step towards fiscal prudence.

The Chief Minister further stated that this change would not affect autonomous bodies like the Himachal Road Transport Corporation (HRTC) and the State Electricity Board, which will continue to disburse salaries on the 1st of each month.

Responding to concerns raised by the Opposition, Sukhu dismissed the notion that the state is facing a financial crisis.

He asserted that the state’s finances are under control and that the government is actively working to become debt-free by 2027 and financially self-reliant by 2032. The Chief Minister also took a dig at the previous BJP government, accusing it of mismanagement and leaving behind significant liabilities.

Earlier, Leader of Opposition Jai Ram Thakur raised concerns over the delayed payments, questioning the government's handling of the situation.

Thakur accused the Chief Minister of making contradictory statements regarding the state’s finances and criticized the government for what he termed a "major flip-flop" in managing the issue.

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