Ensure financial bailout package for Punjabi varsity: PUTA to PreneetUpdated: Feb 27, 2020 23:50 IST
A delegation of the Punjabi University Teachers’ Union handed over a memorandum to Patiala MP (member Parliament) Preneet Kaur, requesting her to ensure a financial bailout package for the varsity to help it overcome the ongoing fund crunch.
The PUTA body apprised Preneet of the fiscal crisis due to which the varsity is finding it difficult to meet its committed expenses. PUTA president Prof Jaswinder Singh Brar said that the PUTA has requested Preneet, who is Patiala MP and wife of Punjab chief minister Captain Amarinder Singh, to press upon the state government to provide a special grant of at least ₹300 crore in the Punjab budget.
“We informed the MP that only a special package can help bailout the university from the continuous borrowing and overdrafting from bank,” he said.
PUTA secretary Gurnam Singh Virk said that the varsity’s response to the situation so far has been to resort to more and more borrowing from the State Bank of India (SBI) branch located on campus, which is not in long-term interest of the institution.
“This policy of borrowing at an exorbitant rate of interest has been pushing the university further into the debt trap and will ultimately lead to financial collapse,” he said.
The PUTA members said that the university is not in a position to discharge its committed liabilities as it has already taken an overdraft of at least ₹132 crore.
“With falling income, decline in admission rates, rising outgoing interest, already high internal resource raising, and increasing expenditures it seems that the situation will further worsen,” the PUTA members said.
They added that they have handed over a written representation regarding their demands to the MP.
The overall expenditure for the year 2019-20 consists of the liability of overdraft equivalent to ₹130 crore. In its budgetary allocation for 2019-2020 financial year, the university had proposed a budget of ₹717 crore, against an income of ₹344 crore. The estimated deficit of ₹372.64 crore for 2019-20 is more than the estimated income.
Moreover, the university’s overall income has declined from ₹445.35 crore in 2016-17 to ₹409.08 crore in 2017-18, and ₹344 crore in the ongoing financial year.