The Centre today launched an austerity drive to contain expenditure in Government Departments. The Finance Ministry has asked all ministries and departments to reduce non-Plan expenditure by 10 per cent in the current financial year. It has banned creation of new posts in government departments, holding of meetings and conferences in five-star hotels, purchase of vehicles besides imposing curbs on foreign travel by the officials.
The office memorandum on 'Expenditure Management -Economy Measures and Rationalisation of Expenditure' also said that holding of exhibitions, seminars and conferences abroad is strongly discouraged. It said, foreign visits should be so regulated as to ensure that each ministry remains within the allocated budget , after 10 per cent cut, for the same. Re-appropriation proposals on this would not be approved.
The Ministry further said, no amount should be released to any entity, including state governments, which has defaulted in furnishing utilisation certificates for grants-in-aid released by the central government without prior approval of the Finance Ministry.
The Finance Ministry's order further said that rush of expenditure on procurement should be avoided during the last quarter of the fiscal and, in particular, the last month of the year so as to ensure that all procedures are complied with and there is no infructuous or wasteful expenditure. The memorandum said, Secretaries of the ministries and departments will be fully charged with the responsibility of ensuring compliance of the measures.
AIR correspondent reports, the austerity measures have been announced in the context of current fiscal situation where there is a tremendous pressure on government's resources. Finance Minister Pranab Mukherjee had earlier said in the Rajya Sabha that his Ministry would come out with austerity measures to check fiscal deficit.
The government's fiscal deficit during 2011-12 was 5.7 per cent of the GDP. The Centre is aiming to bring it down to 5.1 per cent in the current fiscal. It is targeting to cut the subsidy bill to below 2 per cent of GDP this fiscal and 1.75 per cent in the subsequent years.
