Himachal Pradesh is governed by the Congress as they won by a huge majority in the december 2022 elections and won 48 seats out of 68 member Himachal Pradesh assembly. Congress led Himachal Pradesh facing financial crisis due to freebies which has affected a lot of people and residents of Himachal Pradesh. Himachal Pradesh which is led by CM Sukhvinder Singh Sukhu have not paid their monthly salaries to their government employees and these employees are working in the sector of transport, water, medical, forest department etc. The total number of employees who are not paid their monthly salaries are 15000.
The salary is usually paid to the employees on the 1st of the next month so the employees can pay their monthly expenses. However as the salary is not paid to the employees they are unable to pay their expenses as they don’t have enough money to pay them as their source of earning is not providing them with money. Therefore they are also crediting their expenses which creates a cycle in the state of Himachal Pradesh as the government is not paying its employees and the employees are not paying out other people who’s services they have used which is increasing the financial crisis in Himachal Pradesh.
After many opposition ruled states facing financial crisis due to Freebie overload, Now Congress ruled Himachal Pradesh also sounds Financial Alarm, asks it's Ministers & senior Officers to forego two months salary to save the state from financial crisis!pic.twitter.com/TAEtVI1b3W
— Megh Updates 🚨™ (@MeghUpdates) August 29, 2024
Moreover the reports also suggest that along with the delay in paying salaries the Himachal Pradesh government has also taken on a large amount of liabilities due to which Congress led Himachal Pradesh facing financial crisis due to freebies. The reports suggest that Himachal Pradesh has already taken a bank overdraft of 1000 crore and now it has demanded for 800 crore bank loan inorder to pay up the salaries. This has further created a financial crisis for the state as it will have to pay the interest on the loan which will further increase the state’s cost and debts.
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Why is Himachal Pradesh Facing This Situation?
Himachal Pradesh Pradesh which is a beautiful state set in the Himalayas is currently dealing with a severe financial crisis. One of the main reasons behind this is the end of the GST compensation that the state used to receive. Since 2022 this compensation has been stopped leading to a sharp drop in the state’s revenue by around ₹2,500-3,000 crore. It’s similar to a family suddenly losing a large part of their income leaving a big gap in their finances.
Another issue making things worse is the Old Pension Scheme (OPS). By continuing with the OPS the state has reduced its ability to borrow money by about ₹2,000 crore. This situation is like a household reaching its credit card limit leaving Himachal Pradesh Pradesh with limited options to raise more funds. These challenges have put the state in a difficult financial position making it harder to manage its expenses and investments.
The union minister said that the freebies had led to the Himchal to face the financial crisis. There were many schemes which were introduced by the Himachal Pradesh government which gave freebies to the people of Himachal Pradesh. This included Rs 1500 to women who were between age of 18 to 60 years old and free electricity of 300 units were given to every household which has been a major factor in the financial crises of Himachal Pradesh as the government expenditure increased more than their revenue leading to budget deficit.
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