CHENNAI: The State government issued a white paper that has flagged public sector undertakings, particularly, power utilities and State-run transport corporations, as the biggest fiscal stress points, together accounting for debt and losses running into several lakh crore rupees.
The white paper, released by Finance Minister N Marie Wilson, said the power sector alone has accumulated debt of Rs 2.47 lakh crore and losses of Rs 1.82 lakh crore, making it the State's largest financial liability outside the government budget. Nearly 79% of all government guarantees, amounting to Rs 1.42 lakh crore, are linked to power utilities.
Despite tariff revisions, the sector continues to depend heavily on State support. Government assistance to power utilities rose from Rs 20,996 crore in 2021-22 to Rs 33,478 crore in 2025-26, with cumulative support touching Rs 1.45 lakh crore in five years.
State Transport Undertakings (STUs) are facing a similar crisis. Their accumulated losses have surged to Rs 72,667 crore, while liabilities have nearly doubled to Rs 61,642 crore over five years.
A key concern is the widening gap between costs and earnings. Transport corporations spend Rs 78.81 per kilometre but earn only Rs 25.97, resulting in a loss of Rs 52.84 per kilometre operated.
Finance Minister N Marie Wilson said the government would focus on revenue mobilisation, expenditure efficiency and PSU restructuring.
"Clean and corruption-free governance is a key solution. PSU reforms are on the cards," he said.
The white paper called for tighter expenditure management, PSU reforms and plugging of revenue leakages to prevent a deeper fiscal crisis.
The report also warned that Tamil Nadu was ageing rapidly and could "grow old before becoming rich". The elderly population in the State is projected to rise to 18.2 per cent by 2031, increasing future pension, healthcare and welfare liabilities, it said.