Kerala in crisis - the big debt trap
March 14th, 2008
According to the latest report by accounts general, Kerala’s total debt is now over fifty thousand crore rupees! The increase in debt was about 2500 crores just in last 8 months! This is now a ticking bomb, which if not addressed quickly will spiral into total disaster..
Think about this - there will not be more than 5 million adults with income in kerala. That means total debt per employed adult will be over 100 thousand rupees!!
What is more depressing is the fact that government doesn’t care. They just keep on borrowing and borrowing and borrowing. On top of this they even promote useless corporations such as KSRTC. In this budget, government had written of 700 crore rupees which is due from KSRTC. It is like saying - “common guys, let us make more loss next year!”.
But if you look at the taxes, they are already very high. So where is all the money going to? No, it is not going to development activities. But rather the money goes as government salary to feed corrupt officials and then for pension and then finally to all the useless corporations, boards and companies. Probably Kerala will be the only place in planet where we have corporations for every fruit and vegetables(cashew board, coconut board etc. etc.)
Things can be quickly turned around if government takes some small intelligent steps. Here are some of them,
0. Stop starting new companies, corporations and boards until all the current ones start making profit.
1. Dismantle KSRTC and give permits to a lot of private buses. This will bring in a lot revenue and will eliminate debt.
2. Lease out land/buildings owned by KSRTC and other corporations.
3. Implement employee contributed pension fund. Ensure that pension is always funded from the salary of the employees. In next 10 years, this will substantially reduce government burden.
4. Dismiss corrupt government officials immediately and appoint new ones. There are too many qualified people roaming around in Kerala. Pass legislation for the same.
5. Implement performance evaluation for government employees. No productivity means less salary. Obviously this means that all union leaders will get ZERO salary.
6. For every approval (for example, building permit, electricity connection etc.) put a maximum period for decision taking. If the government employee doesn’t take any action on an application, deduct the application fee from the employee’s salary. If anyone repeats this 3 times, dismiss him immediately.
But the only problem is that in order to implement the above we a need a superman.
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March 14th, 2008 at 3:06 pm
The problem with Kerala is that people who are supposed to correct the system are within it. And the people outside system do not have any political muscle to bring changes. Look at our intelligentsia. All of them are either employed in state or central government. We cannot expect these people voice against gov apathy. You do not get to hear this people speak against bad governance but it will always be opposing private entrepreneurship in the name of privatization.
March 14th, 2008 at 11:38 pm
> But the only problem is that in order to implement the above we a need a superman.
Exactly!
But I do hope that atleast some of these suggestions will see the light of day.
March 25th, 2008 at 11:22 am
indeed, these would definitely need a superman.
are you suggesting there is nothing that Kerala can actually do to get out of the debt trap?