The Hindu Business Line : Govt plans to save Rs 3,000 cr through austerity measures

THE Finance Ministry has drawn up a detailed austerity plan through which it hopes to effect expenditure savings to the tune of Rs 3,000 crore during the current fiscal.

For a start, it is targeting `autonomous bodies' under various Ministries, such as the University Grants Commission , Port Trusts, the Council for Scientific and Industrial Research , the Indian Council of Agricultural Research and the All-India Institute of Medical Sciences .

According to North Block officials, while funds released to individual Ministries always lapse in the event of their not being utilised during the course of a financial year, there is no such check on autonomous bodies constituting the `second tier' of spending.

"There are many cases of Ministries releasing fresh funds to these bodies year after year, despite substantial unutilised balances from earlier years lying with them and parked as deposits with banks. We have asked all Ministries concerned to complete a detailed review of all such cases by October 31 and, pending such a review, not to make further releases in such cases," the officials said. The responsibility of regulating releases of funds in these cases has been vested with the Financial Advisers.

Also, it has been decided to review the existing system of providing 100 per cent deficit grants to autonomous bodies. For those bodies that have the potential of raising resources, it is proposed to reduce deficit grants in a graded manner by 5 per cent in successive years to 95 per cent in the first year, 90 per cent in the second year and so on.

The other major austerity initiative mounted has been to undertake a thorough review and evaluation of all ongoing programmes and schemes, both Plan and non-Plan, to determine their continued relevance. The whole exercise is to be completed by the end of the current calendar year.

The Finance Ministry has also mandated a 10 per cent cut in the budgetary allocation for non-Plan, non-salary expenditure, which includes overtime allowance and honorarium.

Specifically, a 10 per cent reduction in the consumption and allocation of funds for expenditure on petrol and travel has been proposed, along with `utmost economy' in use of staff cars and other official vehicles.

The Ministry has further imposed a ban of foreign travel for study tours, seminars and workshops funded by the Government, except for annual and other formal meeting of bilateral or multilateral bodies.

Such of official delegations, where foreign travel is unavoidable, would be restricted to the `bare minimum'.