Himachal: RDG exit triggers austerity push, OPS to stay intact

Facing a fiscal squeeze after the 16th Finance Commission recommended discontinuing the Revenue Deficit Grant (RDG) to Himachal, Chief Minister Sukhvinder Singh Sukhu has directed all departments to raise resources and curb wasteful spending. The Cabinet reviewed the fallout of the RDG withdrawal and signalled a calibrated response rather than sweeping cuts.

Parliamentary Affairs Minister Harshwardhan Chauhan said the CM made it clear that the Old Pension Scheme (OPS), social welfare schemes and pensions will not be touched despite the financial strain. He added that while the Finance Secretary had suggested stringent steps, including a shift from OPS to NPS, withholding DA and arrears, and curbing subsidies, the final decision rests with the Cabinet.

He claimed the government mobilised Rs 3,500 crore through its own efforts over the past three years, even as RDG inflows dropped sharply compared to the previous BJP regime. The Cabinet approved a sub-committee to draft HP State Lottery (Regulation) Rules, 2026, as part of efforts to augment revenues.