Thiruvananthapuram: Dealing a big blow to teachers and non-teaching staff in aided schools, the Finance Department in Kerala has instructed the Government Treasury not to encash their salary arrears but, instead, merge the amount in the Provident Fund (PF).

The official order from the Finance Department says that arrears should not be paid even if an aided school teacher or other staff produces a court order.

The Advocate General has been asked to file an appeal in a higher court against any order by the lower court, adds the directive from the Finance Department.

Huge arrears
Most teachers and other employees of aided schools are regularised only several years after they start working. When the order making them permanent employees is issued, the government is entitled to pay salary arrears with effect from the day they started working. These arrears amount to several lakhs of rupees for each person.

In 2020, the state government issued an order which said that as payment of such huge arrears would cause a severe financial burden, the amounts should be merged in PF.

However, many teachers and other staff resorted to legal measures and encashed the arrears based on favourable court orders.

Incidentally, the government has not regularised appointments in aided schools for some years now as reservation norms for differently abled candidates were not followed. Recently, the government decided to approve appointments in schools where the managements fulfill the reservation criteria for differently abled this month. Consequently, the appointment of a large number of teachers and other employees in these schools would be regularised and they would be entitled to receive arrears running into crores of rupees.

The government has issued the latest directive to dissuade these employees from approaching the court to encash their arrears, said officials.

PSU dividend
In yet another order to tackle the acute financial crisis faced by the state and increase its revenue, the Finance Department has asked state public sector undertakings (PSUs) to transfer the stipulated dividend to the government.

According to the rules, the state government is eligible for dividend as it is a shareholder in almost all state PSUs, corporations and joint enterprises. However, many of these companies often fail to pay the dividend.

The Finance Department’s order says that companies earning a profit of over Rs 50 crore have to pay a dividend of 20% to the government and those who earn less than Rs 50 crore profit, a dividend of 15%