75% Punjab revenue goes to salary…

It will leave only small portion of funds with state for spending on development activities.

Despite expecting buoyancy in revenue receipts,committed expenditure including salary,pension and servicing of debt is expected to drain whopping 75 per cent of total revenue of Punjab,leaving small portion of funds with state for spending on development activities.

“…the committed expenditure on Salaries and Wages,Pensions and Retirement Benefits and Interest Payments as percentage of Revenue receipts is likely at 75.30 per cent in 2010-11 and 74.14 per cent in 2011-12,” Punjab Finance Minister Upinderjit Kaur said in the Budget speech here today.

Committed expenditure of the state is expected to jump by 65 per cent to Rs 24,014 crore in 2011-12 against Rs 14,565 crore in 2008-09,according to budget documents.

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Though the minister attributed huge rise in salary and wage bill to implementation of pay commission,she blamed the Centre for not giving any relief to the state in the shape of grant too bear the additional burden.

The annual liability on account of implementation of pay commission is about Rs 3,000 crore,while arrears from January,2006 till July,2009 stood at Rs 7,200 crore,eating away much of the state’s resources.

Although the state has witnessed robust growth in tax revenue by collecting Rs 20,603 crore in 2010-11 against Rs 13,234 crore in 2008-09,it has not been enough to lower the burden on total revenue.

Punjab’s total revenue has been pegged at Rs 32,026 crore in 2011-10,up from Rs 20,712 crore in 2008-09.

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With state unable to keep pace of revenue receipts with growing expenditure,it is resorting to large scale borrowings,leading to huge debt liability on the state.

Punjab has projected the total debt on the state at Rs 77,585 crore in 2011-12,against Rs 63,435 crore in 2009-10.