Government comes up with austerity plan but doubt remains about its implementationPast experience shows the austerity measures are thrown into the backburner with change in government.
Prithvi Man Shrestha
Even though the government came up with new austerity plans with measures related to reducing expenditure in the areas of vehicle procurement, fuel use, meetings, trips and other areas, questions remain whether it would be implemented.
Even though the previous KP Sharma Oli-led government had last year introduced Standards for Austerity in Public Expenditure-2020, the new government came with another set of standards with a partial amendment to the previous standards. The Finance Ministry on Sunday released the new standards on its website.
“The problem with such standards is that one government introduces the standards and the next government does not give any value to them and they are not implemented,” said Netra Poudel, assistant spokesperson at the Office of the Auditor General.
The auditing body also relies on such standards for calculating unsettled accounts.
Poudel, who is also the director at the auditing body, said that such standards were being introduced as part of ‘populist measures’ by successive governments in an attempt to boost the image of the government or the ruling party(ies) concerned.
“As a result, along with the change in government, the new government doesn’t take such standards seriously,” he said. “Even the agency that issues the standards is not found to be following the standards fully.”
Even in the new standards, most of the provisions are similar to what the previous Oli-led government introduced in the areas of reducing the cost of domestic and foreign trips, meetings, vehicle procurement and fuel consumption. The new government has only made a few amendments to the previous provisions and added some new measures.
According to the new standards, the government agencies will not purchase new four-wheeler vehicles except for elections programmes and delivering health services. The periodic local, provincial and federal elections are scheduled for next year.
Public officials won’t be allowed to use more than one vehicle except in the case where the law has allowed them to do so.
Likewise, as per the new standards public officials will need to cut down on fuel expenses by 10 percent from the existing standards. The new standards have also barred government agencies from providing any encouragement allowance, overtime allowance, lunch allowance and special allowances.
Likewise, only 10 percent of frontline health workers and security personnel deployed to control Covid-19 can be provided such allowances based on a risk analysis.
According to the new standards, no observation trips to foreign countries will be allowed with government resources. No foreign trip will be allowed with the representation of more than three persons except in the case of visits by VIPs. Likewise, government agencies cannot deploy more than three persons for project monitoring.
Mobile phones, laptops and tablets purchased by government agencies should be used for at least five years, according to the new standards.
The standards also bar creation of new organisations and salaried positions in the current fiscal year. But the new standards do not bar recruitment of technical staff and health workers on contract basis.
Likewise, government agencies are required to use electronic medium for communication instead of physical letters and no government funds can be used for sending greetings and congratulatory messages. Seminars should be conducted virtually as far as possible and if physical presence is required, they should be conducted in public offices.
Poudel said one of the reasons why such standards are not properly implemented is the lack of laws.
“Some of the provisions aim to narrow down the scope of the law in the name of controlling unwanted expenditures. Therefore, as long as the law allows, public officials won't hesitate to defy the standards,” he said.
The 56th Annual Report of the Office of the Auditor General had detailed cases of violation of such standards by government agencies. The government had introduced Austerity Guidelines on Public Expenditure-2018, which sought to control unwanted expenditure in procuring vehicles, fuel consumption and their maintenance. But in the fiscal year 2017-18, the government spent Rs6.61 billion on vehicle procurement.
As per the annual report, some ministries had a disproportionately high number of four-wheelers compared to the number of officer-level staff. For example, the number of officer-level staff at the Home Ministry was 90 but there were 174 four-wheelers.
Some government officials claim that the standards are usually followed but their implementation depends on the integrity of the office chief.
Deputy Financial Comptroller at Financial Comptroller General Office Bhesh Prasad Bhurtel said the government staff will almost always go against the standards unless the office chief is serious about controlling unwanted expenditures.
“If the office chief does not have integrity and lacks the capacity to handle the staff, the standards will not be followed,” Bhurtel said. “About 5-7 percent of government offices have such a problem.”
With the introduction of the standards on austerity, the government aims to stem unwanted expenses and save government resources.
But Ritesh Shakya, spokesperson at the Finance Ministry, said that the government didn’t have any specific target regarding saving its resources.
“The main purpose of the standards on austerity is to ensure that the government agencies maintain fiscal discipline,” he said.