Shimla: Slashing the state’s budget outlay significantly, in view of the serious fiscal crisis and the Centre’s withdrawal of the Revenue Deficit Grant (RDG), Chief Minister Sukhwinder Singh Sukhu presented a Rs 54,928 cr budget for the year 2026-27.
The size of the budget has decreased by Rs 3,586 crore this year compared to Rs 58,514 crore in the previous financial year. However, what marks the biggest highlight of Sukhu’s fourth budget is his announcement to defer 50 percent of the Chief Minister’s salary and equally a similar cut on the salaries of the Deputy Chief Minister and ministers up to 30 percent, along with the state’s top bureaucracy, including the Chief Secretary, DGP and Principal Chief Conservator of Forests.
“As part of a policy of ‘fiscal discipline,’ a portion of the salaries of individuals ranging from the chief minister, ministers, and MLAs to senior officials will be temporarily deferred for the next six months. Additionally, 20% of the salaries of all chairpersons, vice-chairpersons, and deputy chairpersons of various corporations and boards will remain deferred for the same period,” Sukhu said in his budget speech.
Yet he announced that no such cut will be imposed on Class III and Class IV employees, who will receive their full salaries, and there has been no reduction in the pensions of retirees.
The Congress MLAs will forego 20% of their salaries, and Speaker Kuldeep Pathania has also voluntarily opted to be included in this list.For secretaries, this reduction will amount to 20%.
He said the boards, corporations, PSUs, autonomous bodies, universities, and institutions receiving grants or budgetary assistance from the government are expected to implement this decision in alignment with the government’s directive.
Conveying his respect for the constitutional dignity and independence of the judiciary, the Chief Minister hoped that the High Court would provide guidance and accord its consent to the temporary deferment of 20% of salaries at the level of district and additional district judges and 3% for the Group A and B officials within judicial institutions.
Sukhu has urged the judiciary to consider, at its discretion, deferring up to 30% of salaries voluntarily at the senior levels. “I, however, want to make it clear that this is only a temporary deferment, and as soon as the financial condition of the state improves, the amount will be returned,” he said The decision, he said, was necessitated by the state’s economic condition and to ensure that everyone continues to receive their salaries and pensions and that development works are also carried out without disruptions.
But, during the budget presentation, the House witnessed commotion, sloganeering, and protests by the opposition BJP, which protested against certain remarks of the Chief Minister when he was trying to explain how the RDG crisis has put the state in a tight spot.
Here, he claimed that it was a matter of sorrow and concern that the opposition BJP did not help the state government. The opposition, rather, abandoned the state in its difficult time and did not stand with the people of the state, who he said would never forgive the BJP.
Due to BJP protests, and MLAs led by Jairam Thakur, Leader of the Opposition (LoP), the House was adjourned for a while, and later efforts were made to restore order and help the Chief Minister to read out his 111-page speech, which he completed in four hours—the longest one in the history.
Eventually, the Speaker agreed to get the objectionable words removed from the proceedings and also the text of the Chief Minister’s speech. Sukhu admitted that discontinuation of the RDG has impacted the annual budget.