Punjab govt not managing fiscal resources efficiently: Guv Purohit to CM Mann

Chandigarh: Punjab Governor Banwarilal Purohit has accused Chief Minister Bhagwant Mann of not managing the state's fiscal resources efficiently, as the tussle between the CM and the Raj Bavan continued.

Replyng to a letter from Mann on the state's debt burden, the governor wrote the state is expected to follow prudent fiscal policies to manage its scarce financial resources.

"However, according to the information available, the state government is not managing its fiscal resources in an effective and efficient manner,” the governor wrote.

Purohit also questioned raising Rs 10,000 crore more debt than what was approved by the state Assembly in the budget.

In 2022-23, the state government borrowed Rs 33,886 crore, as against the approved amount of Rs 23,835 crore, the governor said.

“This additional borrowing needs to be explained as, apparently, it has not been utilised for creation of capital assets,” said Purohit.

“This is evident from the fact that the effective capital expenditure dropped by over Rs 1,500 crore – from a projected Rs 11,375.59 crore to Rs 9,691.53 crore. Further, the additional borrowing was not even used to discharge legacy interest obligations, according to the figures projected in the revised estimates in this regard,” pointed out Purohit.

These demonstrate that the total payments defrayed on this account during the year finally stood at Rs 19,905 crore, as against a projection of Rs 20,100 crore in the budgetary estimates for 2022-23, he said.

The governor wrote back after the chief minister on October 3 had pointed out that a “mammoth” amount was spent on repaying interest on borrowings which were inherited.

Purohit also pointed out “substantial variation” in the figures furnished by the chief minister in comparison to the figures of the Comptroller and Auditor General (CAG) of India.

According to the governor's letter, the state government provided a figure of Rs 47,107 crore as an increase in debt while according to the CAG, it was Rs 49,961 crore from April 1, 2022 to August 31, 2023.

Similarly, the capital expenditure figure of the state government was Rs 10,208 crore as against the CAG's figure of Rs 7,831 crore, the letter stated.

Mann-led AAP dispensation has been at loggerheads with the Raj Bhavan on several issues in the past.