Shimla, May 28
The all-important file containing correspondence between the previous BJP government and the Centre concerning the signing of a memorandum of understanding for carrying out fiscal reforms has disappeared mysteriously from the state Secretariat.
The fact that the file was missing came to light only recently when the government started the exercise to renegotiate the MoU with the Centre after it agreed to extend the time limit for availing of the revenue deficit grant by a year. Highly placed sources said the last movement of the file was traced from the office of the Finance Secretary to the Chief Minister’s office. All efforts to trace the file have failed.
The signing of the MoU on fiscal reforms has been a politically sensitive issue and both the BJP and the Congress have been avoiding taking a clear stand on it. The Dhumal government pursued reforms for the first two years and even managed to get the revenue deficit grant amounting to Rs 150 crore for the first year. However, subsequently it rolled back most of the reforms, fearing an adverse fallout on its popularity and reverted back to populist policies.
Senior officers maintained that the file was very important as it would have revealed what reforms the previous government had agreed to carry out and how sincerely these were being implemented. The terms and conditions of the MoU included measures like downsizing of
the ban on recruitment of daily-wage workers and creation of new posts, reduction in pension burden, reduction of 5 per cent in revenue deficit every year, cap on government borrowings by enacting appropriate legislation and withdrawal of financial support to public sector undertakings.
Sources said the previous government made some commitments to the Centre in pursuance of the MoU but these were not implemented in letter and in spirit. The result was that the financial position of the state worsened. For instance, instead of downsizing, the number of government employees, including ad hoc, part-time and work-charged staff, increased from 2,17,000 in January, 1998, to 2,30,412 in March, 1998, and the outstanding debt from Rs 6,418 crore to Rs 15,000 crore over the five-year period.
The revenue deficit, which was to be brought down by 5 per cent every year, increased steadily from Rs 1,022 crore to Rs 1,482 crore.
However, it remains to be seen what measures the present government agrees to take in the final year to get the revenue deficit grants for the past three years amounting to over Rs 450 crore, which were held up by the Centre because of the failure of the state to carry out reforms in accordance with the MoU.
