From tissue paper to foreign trip – govt tightening its belt

As part of austerity measures, the government is eying to save Tk3,270 crore from a Tk10,050 crore fund which was allocated for furniture, office stationery and other items, and motor vehicle maintenance costs for its ministries and divisions.  The Finance Division is likely to issue a circular soon in this regard.

From the budget allocation, ministries and divisions purchase the items in bulk for the next fiscal year. In an unprecedented turn of events due to the virus pandemic, the fund for this purpose in the 2020-21 fiscal year budget is being trimmed this time.

There are 140 types of items government offices need including fruit cutting knives, plates, spoons and other crockeries, coat hangers, tissues papers and mats. The offices also purchase petrol, lubricants, car cleaning towels, car and auto scents.

The government is set to trim 50% of the costs for furniture, computer and other electronics purchases while both office stationery and car maintenance costs will be slashed by 25%.

"The government's austerity measures are very logical and perfect as other countries are taking similar steps too," Former Finance Secretary Dr Mohammad Tareque told The Business Standard.

"If the costs are not checked, this year's budget deficit would amount to 8-10% of the gross domestic product (GDP)," he estimated. Referring to cost cuttings in the last couple of months of the last fiscal year, Dr Tareque also suggested continuing the measures until the pandemic situation becomes normal.

The former secretary was asked whether the government offices actually require such huge purchases every year. He responded in the affirmative, saying running an office requires many essentials.

Zahid Hussain, former lead economist at the World Bank's Dhaka office, also appreciated the cost-cutting measures. However, he stressed on ensuring saving money from the mechanism.

Projects placed in the last couple of Ecnec meetings had substantial allocations for foreign trips though the government cut down travel allowances by 50%, he said.

"If you save money by postponing car purchase for six months, and then go for a purchasing spree in the next half of the year – the cost-cutting measures will not deliver too much," the economist noted cautiously.

Cabinet Division shopping list

The Cabinet Division will buy 150 dozen of full-plates, 300 dozen of half-plates, 300 dozen of teaspoons, 250 dozen of tablespoons and 250 dozen of forks for the current fiscal year.

Besides, it will buy 2,500 body soaps, 2,000 laundry soaps, knives and scissors each 250 pieces, wall-clock and umbrella 150 each and 23,000 boxes of tissue papers. The shopping list includes 217 types of items with 200 electric kettles, ten colour televisions, refrigerators and furniture.     

After annual purchase, the office items are distributed among government officials according to the demands of the public administration ministry.

According to the distribution protocols, secretaries and additional secretaries get a dozen of full-plate every year while joint secretaries and deputy secretaries get six plates. Four plates are allocated for each senior assistant secretary and assistant secretary while administrative officers and personal officers get three plates each.

Amounts of cost slashing

Finance Division officials said Tk3,920 crore has been allocated in the budget for fiscal 2020-21 for foreign trips. This might be trimmed by 25% to save Tk980 crore.

In the last fiscal year, trips and foreign training had Tk3926 crore budget allocation which was raised to Tk4064 crore in the revised budget.

In the budget allocation, Tk1710 crore has been kept for furniture purchase which may go through a 50% cut, saving Tk855 crore. Computers and other items had Tk1322 crore which also may go through a 50% cost-cut.

The Finance Division also plans to put the Tk465 crore office stationery allocation under a 25% cut to save Tk166 crore.

Car maintenance cost to be slashed 25%

Officials ranked from deputy secretary to additional secretary who took interest-free loans for cars get Tk50,000 vehicle management cost per month. Others who did not take the car loan use government vehicles and the government bears the fuel and maintenance costs for them.          

In the 2020-21 budget, Tk2199 has been allocated for petrol and lubricant for those cars. The Finance Division is set to trim the cost by 25% to save Tk550 crore. Besides, allocation for car repairs will also undergo a 25% cost-cutting.

UNOs to keep tour cost under Tk2 lakh

The Ministry of Public Administration asked the Upazila Nirbahi Officers (UNO) to meet the travel costs for the rest of the year from the initial allocation. The ministry in a recent circular notified the UNOs that they are less likely to get further allocations for travel purposes.

Public administration ministry officials said 50% allocation are disbursed initially in the beginning of a fiscal year while the rest of the amount is given later.

The government has already allocated Tk9.84 crore travel allowance for the 492 upazilas of the country – Tk2 lakh for each. Last month, the Finance Division issued a circular postponing 50% expenditure for travel allowance. Therefore, there is no way for the remaining 50% allowance for the UNOs in the second-half of the fiscal year.

Finance Division officials said Tk1,000 crore could be saved from Tk2,241 crore travel and transfer fund this year.