The State Expenditure Review Committee has hailed the proposed switchover to participatory pension scheme as a ‘sound decision.’
It suggested that implementation of the new scheme may be expedited for achieving fiscal stability in the long run.
The committee tabled its first report for 2010-11 in the State Assembly on Thursday.
Later, head of the committee B.A. Prakash accompanied by members K. Pushpangadan, K.V. Joseph, V. Nagarajan Naidu and Mary George met newspersons here.
The committee blamed mounting expenditure on salaries, teaching grants to aided educational institutions, pensions, and interest for the high fiscal and revenue deficit.
It recommended changes in the fiscal policy and priorities in public spending to effectively address these issues.
COMPULSIVE REVISION
Large and mounting expenditure on salaries and pensions from their compulsive revision every five years is what piles on the twin deficits.
The cycle may be extended to until after 10 years, the committee said. It also rooted for expansion of e-governance on a much wider scale in administration.
This could help facilitate payment of salaries, other entitlements and social welfare schemes through banks in order that intermediation costs are brought down.
E-mail should be relied upon more and more as a cost-effective means for official communication.
Subsidiary activities such as watch and ward, cleaning, gardening and transport of officials could be outsourced.
EDUCATION SPEND
The committee also called for an end to the practice of sanctioning of new educational institutions and courses in the aided sector.
Half of total staff paid for from public funds was employed in educational institutions and more than half of the total salary expenditure was incurred on education.
The system of grants-in-aid has resulted in excess staff and lot of wasteful expenditure, the committee said.
Existing aided educational institutions should be allowed to start new courses only in the unaided stream. Recruitment system in the aided sector should be reviewed.
GRANT COMMISSION
A State University Grants Commission may be set up as a regulatory agency to evaluate activities and allocate grants-in-aid on a regular basis.
An expert committee may review academic activities of Kerala Agricultural University, Fisheries University, and Kerala Veterinary and Agricultural Science University.
State Budget should be passed in every March. Plan proposals should be confined to the supplementary demands for grants.
Monitoring and e-tendering of all Plan activities should be strengthened. Recommendations of the 13th Finance Commission needs to be expedited, it noted.
vinson.kurian@thehindu.co.in