PATIALA: The Punjab government continues to default on the instalments against the power subsidy to the Punjab State Power Corporation Ltd (PSPCL), which is now on the brink of cash crunch.

Even after giving an undertaking to the power regulator that it will pay in advance, the Punjab government has not paid for October and November. In the past also, the payments made by the government against the subsidy were never regular.

In the first eight months this year, the PSPCL had to pay ?9,145 crore (monthly instalment of ?1,143.24 crore), but Punjab government paid only ?2,788 crore in cash. The government adjusted ?1,479 crore against electricity duty, ?620 crore as IDF and ?653 crore in lieu of Uday bonds, which the government had issued to raise loans for the PSPCL.

Functioning with a subsidy shortfall of around ?3,604 crore, the PSPCL is being forced to take loans to meet day-to-day expenses.

“In the first eight months, the amount paid was negligible. We are facing a tough time. Now, peak billing season is over and if the government fails to pay subsidy amount, we won’t be able to pay salaries,” said a PSPCL official, requesting anonymity. He said the management had taken up the matter with the government, but to no avail.

Captain Amarinder Singh government has inherited arrears of unpaid power subsidy totalling ?2,908 crore from the previous SAD-BJP regime for year 2016-17.

In 2017-18, it swelled to ?4,768 crore. Now, the power regulator has calculated the total outstanding sum at ?13,718 crore as yearly subsidy with arrears, with a monthly advance instalment of ?1,147 crore.

“The government cites its financial crunch for non-release of subsidy. However, the PSPCL is bearing a lot of stress. The state government has failed to pay us. Consequently, we have also defaulted on payments to power suppliers and other contractors,” said an official, on the condition of anonymity.

Pertinently, on June 5, the power regulator had said, “Financial distress in the power distribution utility adversely affects consumers in the state. The commission has directed in its tariff order that the arrears of subsidy and subsidy due in 2018-19 be paid in advance monthly instalments. If the government fails to do so, the PSPCL is free to charge subsidy from consumers.”

Retired chief engineer Padamjit Singh, who had filed the petition that led to this direction from the regulator, told HT, “These directions and statements are true and operative even now. However, it is seen that instead of covering up the subsidy default, the government defaulted again. This is gross contempt of Sec 65 of the Electricity Act 2003 as well as the orders of the regulator.”

He added that he has already written to the regulator to enforce its decision in toto.

PSPCL chairman-and-managing director Baldev Singh Sran could not be contacted for a comment. However, his office said he had taken up the matter of early release of subsidy arrears with the chief secretary and the finance department.