Power subsidy default: Capt Amarinder govt blames GST, previous regime; says can’t pay in advance

The government has now sought more time to pay the subsidy; and the PSERC in the next hearing will record arguments from both sides on continuation of free power supply in lieu of subsidy.

The state government has passed the buck of non-payment for subsidy borne by the Punjab State Power Corporation Limited (PSPCL) to the central government by blaming the goods and services tax (GST), and also to the previous SAD-BJP regime in the state over a Rs 31,000-crore loan taken by it near the end of its tenure.

The Congress government expressed inability to pay the subsidy in advance even as rules mandate that.(HT File)

The contentions came forth as additional chief secretary Satish Chandra filed an affidavit before the Punjab State Electricity Regulatory Commission (PSERC) during the hearing of a petition by former PSPCL engineer Padamjit Singh, who has challenged the delay in release of subsidy in lieu of free supply to the farm sector and other sections.

The state finance department submitted that there was a major disruption of revenue due to GST coming in.

The Congress government expressed inability to pay the subsidy in advance even as rules mandate that. For this fiscal alone, the government has to pay Rs 11,542 crore, including a carry-forward of over Rs 2,000 crore from SAD-BJP times; but has so far paid only Rs 5,676 crore. Both the government and the PSPCL are finding it difficult to pay salaries.

The state finance department submitted that there was a major disruption of revenue due to GST coming in, and that the government has to pay an additional Rs 3,000 crore a year on food loan account too.

The petitioner submitted the subsidy account statement of the PSPCL wherein payment of Rs 3,271.49 crore from April 2017 to January 2018 was detailed . No subsidy was paid in August and September; and there was no payment in November too, while only Rs 100 crore was paid in December. In January this year, that came down to Rs 50 crore. He argued that this is non-compliance of the PSERC orders as well as of section 65 of Electricity Act 2003, which says that full tariff be applied in the event of default in subsidy payment.

The government has now sought more time to pay the subsidy; and the PSERC in the next hearing will record arguments from both sides on continuation of free power supply in lieu of subsidy.