Telangana tightens its belt to tackle cash crisis; govt freezes all payments
Hyderabad: The TS government is all set to put in place austerity measures to tide over the current financial crisis. A ban on purchase of new vehicles, furniture, creation and filling up of new/ old vacancies on regular / temporary basis are on the cards.
The restrictions will be applicable till March 2017, the end of this fiscal.
The other measures include a ban on holding of government seminars / conferences / events in star hotels, restrictions on foreign trips and flight travel.
With the financial condition of government turning upside down due to demonetisation, the government has been forced to launch an austerity drive, to cut down expenditure.
The government which normally earns Rs 5,400 crore per month due to tax collections is expected to witness over 50 per cent fall this month due to business activities grinding to a halt under the impact of demonetisation.
The remaining four months of this fiscal (December 2016-March 2017) are crucial for TS government as it has to meet budgetary targets for 2016-17.
The first seven months of this fiscal (April-October 2016) was encouraging with all revenue earning departments witnessing a growth rate of nearly 30 per cent over last year.
However, the sudden announcement on demonetisation on November 8 reversed the situation. There is no business activity across the state due to which the collection of taxes came to a halt.
The government recently filled up several nominated posts for various corporations, who include chairmen, members etc. The government has been receiving requisition letters from them for purchase of new vehicles, furniture, renovation of offices/ residential quarters etc. The finance department has issued instructions to all departments to put all such proposals on hold till further orders.
The treasuries department has been asked to freeze all payments till further orders. Even payments of those departments for which tokens were already issued have been stopped. The payment of bills for contractors taking up irrigation projects and Mission Bhagiratha were also stopped.
