Vidhi Codex

The Kerala Ceiling on Government Guarantees Act, 2003

The Kerala Ceiling on Government Guarantees Act, 2003

General20038 sections

The Kerala Ceiling on Government Guarantees Act, 2003, regulates the maximum financial guarantees the Kerala state government can issue. Applying to state departments, public undertakings, local bodies, and co-operatives, it strictly bans backing private loans. The law limits total outstanding guarantees to either the preceding year's revenue receipts or ten percent of the Gross State Domestic Product, whichever is lower. It also mandates a minimum annual commission to maintain a redemption fund. This legislation matters because it enforces state fiscal discipline, protects public taxpayers from bearing the cost of bad debts, and ensures long-term governmental financial stability.

Start reading →Read full ActSections
  1. 0. Preamble
  2. 1. Short title and commencement.
  3. 2. Definitions.
  4. 3. Ceiling on Government Guarantees.
  5. 4. Prohibition.
  6. 5. Guarantee commission.
  7. 6. Guarantee Redemption Fund.
  8. 7. Power of Government to make rules.

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