The UPA government’s austerity drive may have launched a thousand tweets but is around for another year or so. Senior government sources say, finance minister Pranab Mukherjee has confided in his officials and declared that the austerity measures will remain in place for at least a year, till September 2010.
“Any hopes that the austerity drive will end with a robust Diwali trading season can now be let go of. “Despite green shoots in the economy, the drive will go on till next year,” a top government source said.
The global economic slowdown has been coupled with one of the worst droughts in 60 years in India and the worst floods in a century in south India. Mukherjee has also said that the goal will be to reduce non-plan spending in each government department and target Rs30,000 crore in savings across the board.
“By travelling in economy, budget airlines and trains, and eschewing five star conferences and seminars, reduced entourages for foreign trips, the finance minister is hoping that this target can be reached,” the source said.
“The logic behind this is clear. We cannot cut salaries and emoluments of government servants, unlike the private sector. In fact, Government of India has gone against the trend and hiked salaries through the VIth pay commission, therefore this is the only way forward,” the source said. Mukherjee has apparently been at pains to emphasize this point to everyone.
That unlike the private sector, the government has not laid off anyone, nor cut salaries and the people at the top are not getting bonuses at the cost of jobs at the lower end. “Therefore, if some belt-tightening has been asked for, it should be complied with,” the source said. Some ministers had been pulled up publicly for defying the austerity measures, but by and large, people have fallen in line, officials said.
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