Low reserves, states postpone salaries, announce cutbacks to receive funds as coronavirus cases increase

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Picture for illustration: People collect ration from a government depot during a nationwide ban after a coronavirus pandemic in Bikaner, Monday March 30, 2020. (PTI photo) (PTI30-03-2020_000064B)

Picture for illustration: People collect ration from a government depot during a nationwide ban after a coronavirus pandemic in Bikaner, Monday March 30, 2020. (PTI photo) (PTI30-03-2020_000064B)

The measures are being taken at a time when the countries are already starved and face many GST compensation.

  • News18.com
  • Last update: April 1, 2020, 12:27 p.m.

New Delhi: To keep liquidity in the treasury intact, governments have asked employees to bite the ball, either announcing wage cuts or postponing their salaries.

Maharashtra chief minister Uddhav Thackeray has announced that he and other MLAs will cut wages by 60 percent. A and B grade officials will receive a 50 percent cut. However, there are no deductions for employees of grade D.

The deduction of wages is only valid for the month of March, said Maharashtra Finance Minister Ajit Pawar.

Telangana’s chief minister, K Chandrashekar Rao, and other ministers of state and members of the Legislative Assembly (MLAs) will cut salaries by 75 percent. The heads of state bodies and representatives of local bodies will also cut their wages by three quarters.

“Due to the COVID-19 pandemic, the salaries of the Prime Minister, State Cabinet, MLCs, MLAs, heads of state-owned companies, and local government representatives will be reduced by 75 percent in view of Telangana’s financial situation,” said Telangana Prime Minister on Monday.

Administrative, police and foreign service officials, as well as other central service officials, are required to deduct 60 percent of their salaries. In all other categories of workers, including pensioners, wages are reduced by 50 percent.

In the meantime, Rajasthan chief minister Ashok Gehlot has caused his cabinet to take a decision to delay 75 percent of his gross salary and all ministers and MLAs in the face of the economic burden on the state from the coronavirus pandemic.

The cabinet ruled that 60 percent of IAS officials’ salaries and 50 percent of government services were deferred. 30 percent of pensioners’ salaries are also deferred.

However, Gehlot said the police, fourth grade employees, health workers, doctors and contract workers are exempt from such a partial shift in salaries.

The Odisha government decided on Tuesday to defer the salaries of elected All-India Services representatives and officers to deal with the economic situation resulting from the nationwide ban and Covid-19 control spending.

According to a government announcement, the gross salary of the chief minister, all ministers, MLAs, chairpersons of all companies and elected representatives of local bodies is deferred by 70 percent.

In addition, the gross salary of all Indian service officers such as IAS, IPS and IFS (Indian Forest Service) is deferred by 50 percent. The announcement states that the order will take effect immediately.

The Andhra Pradesh government has announced that it will defer payment of full salaries to the Prime Minister, other elected representatives, officials and other government employees. The sources of income are “completely dry” due to the ongoing blockade to combat the new coronavirus.

According to the order, the deferral for different categories of employees is between 10 and 100 percent.

All India Services Officers (IAS, IPS and IFS) will see a 60 percent deferral of their salaries, while all other employees will only receive 50 percent of their salaries, it said.

Class IV employees, outsourced and contracted employees as well as the newly hired employees of the village and ward secretariat receive 90 percent of their salary, with only 10 percent being deferred.

In addition, employees and retired employees of all PSUs, state-supported institutions, universities and autonomous institutions would only receive partial deferrals of payments, it said.

It is important to note that these measures are taken at a time when states are already starving. For example, GST compensation is pending for many countries and should be paid every two months.