Kerala Govt Restricts Pay Revisions by PSUs, Corporations Without Approval

Swift Summary

• the State goverment has issued a directive prohibiting public sector units,boards,and corporations from implementing pay revisions without prior approval from the Finance department and Cabinet.
• The August 30 order is applicable to public sector enterprises, grant-in-aid institutions, development authorities, boards, corporations, and autonomous institutions.
• Responsibility for adhering to this directive lies with the Chief Executive Officers of these institutions.
• Government representatives on institution boards are required to inform the board chairman about the directive and register dissent if needed.
• A similar warning was previously outlined in a January 18, 2021 circular but was ignored by some organizations.

Indian Opinion Analysis

The government’s reiteration of its policy on pay revision indicates concern over non-compliance among public sector entities. Financial matters like pay revisions can significantly impact budgetary allocations and fund stability. By mandating prior approval through stringent directives, the government aims to ensure adherence to fiscal discipline across all governed entities. However, repeated violations suggest challenges in effective enforcement or an institutional disconnect between governance policies and organizational practices.

This situation underscores the importance of internal accountability mechanisms within such entities while emphasizing coordination between governing bodies for smoother implementation of financial decisions.Adhering strictly to these guidelines would help prevent potential overspending or unplanned financial strain at higher administrative levels.Link for read more: source