Govt on austerity drive

Govt on austerity drive

Centre bars wasteful spending; cut in non-Plan expenditure

The measures, aimed at some financial belt-tightening, include drastic slashing of foreign and domestic travel and a complete ban on holding conferences in five-star hotels. The steps are part of a larger directive which the finance ministry issued on Tuesday, urging all ministries and departments to observe austerity in view of the pressure on the government’s purse.

The ministry’s move to tighten the purse strings came almost three weeks after Congress president Sonia Gandhi asked the government and the ruling party’s rank and file across the country to observe austerity measures in order to reflect the sensitivity and concern for the drought-hit people.

In view of the current fiscal situation and likely pressure on government resources arising out of insufficient rain in large parts of the country,  there was need for further economy and rationalisation of expenditure, the statement said.

The proposed 10 per cent expenditure cut will be applicable to various heads like publicity, publications, professional services, advertising and publicity and other administrative expenses. Over and above this, the remaining portions of non-Plan expenditure, excluding interest payments, repayment of debt, defence spending, salaries and pension, will be subjected to a mandatory 5 per cent cut.

The statement suggests that all ministries should discourage holding exhibitions and seminars in foreign countries, unless it is absolutely necessary to do so.

The ministries can organise seminars and conferences in the country, but not in the five-star hotels or other expensive locations. No executive or business class air travel on government expenses should be allowed and bureaucrats should always travel in economy class while on official tours.

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