Interview/ Sukhvinder Singh Sukhu Himachal Pradesh chief minister
HIMACHAL PRADESH Chief Minister Sukhvinder Singh Sukhu recently announced that he, his ministers, chief parliamentary secretaries, and chairpersons and vice-chairpersons of boards and corporations would defer drawing their salaries for two months. It immediately put the focus on the finances of the hill state, which are not in the pink. In an exclusive interview, Sukhu says the state had already moved from a stage of financial crisis to financial discipline and fiscal prudence. Excerpts:
Q/ Is Himachal Pradesh going through a financial crisis?
A/ The financial crisis was because of the freebies announced by the BJP government. In April 2022, before the assembly elections, it made electricity up to 125 units free, waived off water bills and announced a discount of 50 per cent on fare for women travelling by state buses. There was a debt of more than Rs85,000 crore and a liability of Rs10,000 crore towards arrears to be paid to the employees as per the recommendations of the Sixth Pay Commission. We spend Rs25,000 crore on salaries of government employees every year. Our total budget is Rs52,000 crore. The freebies announced by the BJP government made the situation worse.
Q/ What is your government doing to deal with the financial crunch?
A/ We were in a financial crunch in 2022-23. We are bringing the economy back. We earned Rs2,200 crore additional revenue in a year.
When you change the system, some pain has to be endured. We are taking some tough decisions such as not providing free electricity and free water to everyone. Those who are paying income tax can pay for electricity and water. We have shut down 500 schools because there were no teachers in those schools. We want to provide people with good quality electricity, health care, food and education.
Q/ Are you reworking the subsidies?
A/ We were providing subsidy of Rs1 per unit of electricity to hotels. Why should five star or three star hotels that are making profits get this subsidy? We have stopped the subsidy on electricity given to commercial entities. A similar rationalisation is being done with regard to water subsidy. Only the poor families will get it for free.
Q/ Your decision to defer the salaries of the chief minister, the ministers and others gave out the message that the state’s finances were in poor shape.
A/ It is a symbolic move. How much will our salaries add up to? Rs1 crore or Rs1.5 crore. This was done to send out a message to society that if we move in the right direction now, our future generations will be safe. It was meant to send out a message of self-regulation and fiscal discipline, that the political leadership and the people, everyone has to participate in this.
Q/ Opposition leader Jai Ram Thakur says the government does not have the money to pay the salaries of the employees.
A/ We pay Rs2,000 crore a month towards the salaries and pensions of our employees―Rs1,200 crore for salaries and Rs800 crore as pension. The state takes loan from the RBI at a rate of 7.5 per cent to pay these. The share of the states from the Centre-state taxes reaches the states on the sixth of every month. We would pay interest rate on the loan taken from the RBI for five days. So by paying the salary on the sixth instead of the first of the month, we would save on the interest. In a year, we would save Rs36 crore.
Q/ The BJP claims that your government raised loans of more than Rs24,000 crore over the past 18 months and you will end up with Rs1 lakh crore debt by the end of this financial year.
A/ That is not true at all. This year, we have taken a loan of Rs6,300 crore, and last year, we had taken a loan of Rs8,000 crore. The loans are strictly as per the guidelines of the RBI.
Q/ Another allegation is that your government has taken loans by mortgaging employees’ general provident fund.
A/ Every state does that. It is a routine process.
Q/ Opposition-ruled states have complained about not getting adequate financial assistance from the Centre.
A/ The Centre is supposed to give us Rs9,300 crore as per its post-disaster assessment in the aftermath of the devastating floods in the state last year. They have to give us Rs9,200 crore that has been contributed by the employees under the National Pension Scheme. Around Rs5,000 crore is due to Himachal Pradesh from the Bhakra Beas Management Board. If we get all these funds, the financial issues will be taken care of.
Q/ Do you feel there should be a rethink on the populist measures announced during the elections?
A/ Subsidies or benefits should be given to those who need it. They have to be rationalised.
Q/ The Congress had promised old pension scheme, Rs1,500 for women and free power.
A/ We are implementing all these promises.
Q/ How are you enhancing your revenues?
A/ We will ensure that companies extracting minerals in the state pay the royalty and the tax that is due to the state, or the state will take over the facilities.
Q/ The BJP says there were irregularities in the excise department.
A/ In five years, the BJP government earned Rs600 crore in excise. We have in one year earned Rs485 crore. So where is the problem? We have auctioned liquor vends, which did not happen during the term of the BJP government.
Q/ Are you now placed comfortably in terms of numbers in the assembly?
A/ Of course, yes. We are back to being 40 MLAs in the assembly. There are no independent MLAs and it is just between the Congress and the BJP.