Govt asks all depts to clear pending dues of MSMEs, industries & civic bodies

Bhubaneswar: In a significant move to help the lockdown-hit micro, small and medium enterprises (MSMEs), industries and also the municipalities and service providing utilities facing financial crunch owing to Covid-19, the state finance department has asked all departments to clear the dues pending against the above entities by the end of this month.
Keeping in view the difficult times owing to the lockdown to prevent the novel coronavirus, all government offices, state PSUs and other autonomous bodies are instructed that all dues/claims of MSMEs, industries, municipalities and utilities should be released immediately within two weeks, state finance secretary Ashok Meena wrote in a letter to all the secretaries and heads of departments.
The move aims to help the entities tide over the period of extremely low revenue realisation, thereby improving their financial health to some extent. This is a part of government’s consolidated efforts to fight this crisis on multiple fronts, a senior government official said.
While the government offices, state PSUs and other autonomous bodies like universities procure goods and avail services from MSMEs and industries, they don’t settle the dues/claims in time pushing them to financial hurdles. Similarly, dues like electricity bill, holding tax and water bills are also pending against utilities and municipalities. Though there is no official figure of the pending dues against the entities, official sources said it could be more than Rs 1,000 crore.
Clearing the dues of MSMEs and industries is crucial for their survival at this critical moment. The MSME associations also raised the issue during a recent meeting with the state government. The finance department has made an adequate budget provision for all the departments. They should utilise the amount and clear the dues, the official said.
The Centre’s recent economic package for the MSME sector also emphasised on creating a special fund to clear the dues of small and medium industries.
Apart from the dues, the departments have also been asked to release the security deposits or performance securities collected from contractors and suppliers to ensure the proper and timely execution of a contract.
The amount deposited by the suppliers or contractors is usually refunded by the authorities once a contract is successfully executed. However, many departments have held the deposit for years without clearing them on time, the official said.
In his letter, the finance secretary also asked the departments to submit a consolidated report to the finance department on the amount cleared by various departments and PSUs under their administrative control by June 5.