Kerala CM Tables White Paper on State Finances in Assembly; Debt at Rs 5.07 Lakh Crore
Kerala Chief Minister V D Satheesan on Thursday presented a white paper on the state's fiscal health in the Assembly, revealing that the state's financial structure is under serious and growing strain, with outstanding liabilities amounting to Rs 5.07 lakh crore.
The document, titled 'Kerala's Fiscal Health: A Status Report', highlights the state's large burden of outstanding liabilities, committed expenditure amounting to 77 per cent of total revenue receipts (TRR), and interest payments accounting for 20.9 per cent of TRR. It notes that Kerala's capital expenditure stands at 1.3 per cent of its Gross State Domestic Product (GSDP), among the lowest levels among Indian states, despite the state running one of the country's highest fiscal deficits.
“Kerala has been violating the basic tenet of 'borrow to invest, growth will repay' in a big way, weakening the growth-generating capacity,” the white paper stated.
The document further said that the state's fiscal stress has been compounded by “parallel governance structures” such as the Kerala Infrastructure Investment Fund Board (KIIFB), which have drained part of the revenue flow on one side while creating massive liabilities on the other.
According to the white paper, Kerala's committed expenditure burden is more than one-and-a-half times the national average of 46.1 per cent and significantly higher than that of comparable states. This leaves “barely one rupee in four for everything else: schools, hospitals, roads, welfare programmes and support to local governments,” it said.
The document also noted that the Goods and Services Tax (GST), a major component of the state's own tax revenue, has performed poorly in recent years, with Kerala remaining below the all-state average.
Opposition Raises Objections
The Left Democratic Front (LDF) alleged that the white paper was prepared in violation of constitutional and legal provisions. Former Finance Minister K N Balagopal objected to the tabling of the document, claiming that it had been prepared by private individuals who should not have been given access to the government's internal accounts. He argued that the move amounted to a violation of the oath of office, the Official Secrets Act, and the Constitution.
Balagopal said all previous white papers had been prepared by the Finance Department and described the latest report as a political document. “If this document is allowed to be tabled, it would create a wrong precedent for the future,” he said.
Similar objections were raised by Leader of Opposition in the Assembly Pinarayi Vijayan, who expressed surprise and serious concern that the white paper had not been prepared by the Finance Department.
