No.7(1)/E.Coord.l2014 

Government of India

Ministry of Finance Department of Expenditure

North Block, New Delhi,  October, 2014

OFFICE MEMORANDUM

Subject: Expenditure Management - Economy Measures and Rationalisation of Expenditure.

Ministry of Finance, Department of Expenditure has been '" issuing austerity instructions from time to time with a view to containing non-developmental expenditure and releasing of additional resources for priority schemes. The last set of instructions was issued on is" September 2013 after passing of the Union Budget. Such measures are intended at promoting fiscal discipline, without restricting the operational efficiency of the Government. In the context of the current fiscal situation, there is a need to continue to rationalise expenditure and optimize available resources. With this objective, the following measures for fiscal prudence and economy will come into immediate effect:-

2.1 Cut in Non-Plan expenditure:

For the year 2014-15, every Ministry / Department shall effect a mandatory 10% cut in non-Plan expenditure excluding interest payment, repayment of debt, Defence capital, salaries, pension and Finance Commission grants to the States. No re-appropriation of funds to augment the Non-Plan heads of expenditure on which cuts have been imposed shall be allowed during the current fiscal year.

2.2 Seminars and Conferences:

(i) Utmost economy shall be observed in organizing conferences/ Seminars/workshops. Only such conferences, workshops, seminars, etc. which are absolutely essential, should be held wherein also a 10% cut on budgetary allocations (whether Plan or Non-Plan) shall be effected.

(ii) Holding of exhibitions/fairs/seminars/conferences abroad is strongly discouraged except in the case of exhibitions for trade promotion.

(iii) There will be a ban on holding of meetings and conferences at five star hotels except in case of bilateral/multilateral official engagements to be held at the level of Minister-in-Charge or Administrative Secretary, with foreign Governments or international bodies of which India is a Member. The Administrative Secretaries are advised to exercise utmost discretion in holding such meetings in 5-Star hotels keeping in mind the need to observe utmost economy in expenditure.

2.3 Purchase of vehicles:

Purchase of new vehicles to meet the operational requirement of Defence Forces, Central Paramilitary Forces & security related organizations are permitted. Ban on purchase of other vehicles (including staff cars) will continue except against condemnation.



2.4 Domestic and International Travel:

(i) Travel expenditure {both Domestic Travel Expenses (DTE) and Foreign Travel Expenses(FTE)} should be regulated so as to ensure that each Ministry remains within the allocated budget for the same after taking into account the mandatory 10% cut under DTE/FTE (Plan as well as Non-Plan). Re-appropriation! augmentation proposals on this account would not be approved.

(ii)While officers are entitled to vanous classes of air travel depending on seniority, utmost economy would need to be observed while exercising the choice keeping the limitations of budget in mind. However, there would be no bookings in First Class."

(iii) Facility of Video Conferencing may be used effectively. All extant instructions on foreign travel may be scrupulously followed.

(iv) In all cases of air travel the lowest air fare tickets available for entitled class are to be purchased! procured. No companion free ticket on domestic/ international travel is to be availed of.

Creation of Posts

(i) There will be a ban on creation of Plan and Non-Plan posts.

(ii) Posts that have remained vacant for more than a year are not to be revived except under very rare and unavoidable circumstances and after seeking clearance of Department of Expenditure.

3. Observance of discipline in fiscal transfers to States, Public Sector Undertakings and Autonomous Bodies at Central/ State/Local level:

3.1 Release of Grant-in-aid shall be strictly as per provisions contained in GFRs and in Department of Expenditure's OM No.7(1)/E.Coord/2012 dated 14.ll.2012.

3.2 Ministries/Departments shall not transfer funds under any Plan schemes in relaxation of conditions attached to such transfers (such as matching funding).

3.3 The State Governments are required to furnish monthly returns of Plan expenditure - Central, Centrally Sponsored or State Plan - to respective Ministries/Departments along with a report on amounts ouistanding in their Public Account in respect of Central and Centrally Sponsored Schemes. This requirement may be scrupulously enforced.

3.4 The Chief Controller of Accounts must ensure compliance with the above as part ofpre-payment scrutiny.

4. Balanced Pace of Expenditure:

4.1 As per extant instructions, not more than one-third (33%) of the Budget Estimates may be spent in the last quarter of the financial year. Besides, the stipulation that during the month of March the expenditure should be limited to 15% of the Budget Estimates is reiterated. It may be emphasized here that the restriction of 33% and 15% expenditure ceiling is to be enforced both scheme-wise as well as for the Demands for Grant as a whole, subject to RE ceilings. Ministries/ Departments which are covered by the Monthly Expenditure Plan (MEP) may ensure that the MEP is followed strictly.

The State Governments are required to furnish monthly returns of Plan expenditure - Central, Centrally Sponsored or State Plan - to respective Ministries/Departments along with a report on amounts ouistanding in their Public Account in respect of Central and Centrally Sponsored Schemes. This requirement may be scrupulously enforced.



4.2 It is also considered desirable that in the last month of the year payments may be made- only for the goods and services actually procured and for reimbursement of expenditure already incurred. Hence, no amount should be released in advance (in the last month) with the exception of the following:

(i) Advance payments to contractors under terms of duly executed contracts so that Government would not renege on its legal or contractual obligations.

(ii) Any loans or advances to Government servants etc. or private individuals as a measure of relief and rehabilitation as per service conditions or on compassionate grounds.

(iii) Any other exceptional case with the approval of the Financial Advisor. However, a list of such cases may be sent by the FA to the Department of Expenditure by so" April of the following year for information.

4.3 Rush of expenditure on procurement should be avoided during the last quarter of the fiscal year 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. FAs are advised to specially monitor this aspect during their reviews.

5. No fresh financial commitments should be made on items which are not provided for in the budget approved by the Parliament.

6. These instructions would also be applicable to autonomous bodies funded by Government of India.



7. Compliance

Secretaries of the Ministries / Departments, being the Chief Accounting Authorities as per Rule 64 of GFR, shall be fully charged with the responsibility of ensuring compliance of the measures outlined above. Financial Advisors shall assist the respective Departments in securing compliance with these measures and also submit an overall report to the Minister-in-Charge and to the Ministry of Finance on a quarterly basis regarding various actions taken on these measures / guidelines.

(Ratan P.Watal) 

Secretary(Expenditure)

All Secretaries to the Government of India

Copy to:

1. Cabinet Secretary

2. Principal Secretary to the Prime Minister 3. Secretary, Planning Commission

4. All the Financial Advisors

Source: www.finmin.nic.in

[http://finmin.nic.in/the_ministry/dept_expenditure/notification/emre/Austerityinstructions2014.pdf]

PM Modi boots officers out of the first class cabin

New Delhi : Prime Minister Narendra Modi has ordered bureaucrats to forgo the luxury of flying first class and start paying for their spouses’ air tickets as he tries to deliver on a promise to cut the fiscal deficit to a seven-year low.

Prime Minister Narendra Modi

The ban on first-class travel, which could save Rs 18500 on a long-haul flight, is part of an austerity drive launched by Modi on Thursday to cut discretionary spending by 10 percent in the fiscal year to March 2015.

While Thursday’s small-bore measures copy a playbook New Delhi has relied on since 2012 to trim a bloated deficit, they fit in with the frugal image that Modi, 64, has cultivated since becoming prime minister five months ago.

“There is a need to continue to rationalise expenditure and optimize available resources ,” the finance ministry said in its directive.

The ministry has also barred meetings at five-star hotels , the purchase of cars for government officials and the creation of new posts in central departments .

However, interest and debt payments, the defence budget , salaries and pensions will not be affected.

“Such measures are intended at promoting fiscal discipline , without restricting the operational efficiency of the government,” the finance ministry said.

India’s longest economic slump since the 1980s has slashed tax receipts, forcing New Delhi scale back public spending by nearly Rs 2 lakh crore in the past two years to deliver on its deficit goal and retain its investment -grade credit rating.

In its maiden budget in July, Modi’s government pledged to narrow the fiscal deficit to a seven-year low of 4.1 percent of gross domestic product in the fiscal year to next March.

A slide of 25 percent in global oil prices since June has made government officials more confident of meeting a tough target without deeper spending cuts.

Reuters

NOW AADHAR LINK TO YOUR MOBILE

In an attempt to weed out ghost users and curb the misuse of mobile phones for anti-social and terrorist activities in the country, the government is likely to mandate the linking of Aadhar numbers to mobile SIM connections.

According to an Economic Times report, seeding of Aadhar could become compulsory for new as well as existing phone connections. The move comes after a recent review of the Aadhar program, where the top brass of the government felt it was an appropriate use of the unique identification system.

"Government has planned to make it compulsory seeding of mobile SIM cards with Aadhaar to keep a tab on use of mobile phone connection for anti-social act including terrorism and extortion," said an unnamed source, according to the ET report.
The report adds that the government may however go slow on the linking of Aadhar numbers with SIM connections, as not all citizens have the unique identification number yet. This move is reminiscent of the UPA government's scheme to make linking of Aadhar to bank accounts mandatory, which fell apart.

However, with the seemingly new lease of life the UIDAI program has been given by the Narendra Modi led government, we wouldn't be surprised if it goes through. The government has set a deadline of next June to cover the entire population under the Aadhar project, completing which all such schemes can be put into overdrive

7CPC

National Convention of the National Council (JCM Staff Side) to be held on 11.12.2014.

Shiva Gopal Mishra
Secretary

Ph: 23382286
National Council (Staff Side)
Joint Consultative Machinery for Central government Employees
13-C, Ferozshah Road, New Delhi – 110001
E Mail : nc.jcm.np@ gmail .com

Ref. No.NC-JCM/2014/SC

Dated: October 25, 2014

All Constituent Organisations,
National Council(JCM)

Dear Comrades,
Sub: Holding of National Convention of the National Council (JCM)(Staff Side)

As you are aware, the Staff Side, JCM National Council had, as desired by the 7th CPC, submitted a separate memorandum on Interim Relief and Merger of DA, copy of which had also been sent to the Finance Ministry. During the Informal Discussions the Staff Side had with the Pay Commission, they had assured us to take up the issue with the Government seeking amendment to the Terms of Reference to enable them to act upon our memorandum.

We have received reply from the Finance Ministry, which is indicative of a refusal of both the demands. The NDA Government has adopted the same plea made by the UPA II Government to reject our demands. The 7th CPC have so far not communicated to us, the decision they have taken on our memorandum.

From the steps so far taken by the BJP Government, it is unambiguous that they would be pursuing the neo-liberal economic policies with much more intensity than even the UPA Government. Having got a clear majority in the Parliament, they would be able to push through necessary legislations to pursue reforms. The outsourcing of Railway functions, privatization of Defence manufacturing Units, increased FDI inflow in various core sectors of economy, dismantling of the administrative price mechanism, de-nationalization efforts in the Banking, Insurance and Coal Sectors and above all the adherence to New Contributory Pension Scheme are some of the bold anti worker steps taken by the new Government.

The matter of fact approach and urgency which was visible in the initial days of the 7th CPC appears to have vanished. It is a matter of pride for all of us that we could submit our final memorandum on common issues to the Commission within the stipulated time frame. We are also happy to note that almost all service organizations of Central Government employees have endorsed our formulations on the wage structure and other service benefits. It is also a fact that all these organizations have submitted their memoranda on department-specific issues before 31st July, 2014. Despite having received such large number of memoranda, the 7thCPC has so far not commenced taking oral evidence giving an indubitable impression that the Commission might not be able to submit its report within the stipulated time of 18 months.

All these issues came up for the consideration of the members of the Staff side when they met a few days back. The unanimous opinion was to pursue the issues through organizational methods. Accordingly, it was decided to hold a National Convention, eliciting the participation of the representatives of all Service organizations participating in the JCM to discuss the emerging situation and decide upon future course of action. Incidentally, we must mention that the JCM conceived as a negotiating forum has been made
ineffective by the Government over the years by not convening its meetings periodically.

The National Convention will be held at MPCU Shah Auditorium, Sree Gurjarathi Samaj, Raj Niwas Road, Civil Lines(Opposite Civil Lines Metro Station), Delhi, on 11th December, 2014. The Convention will commence at 12 Noon and will be concluded by 4.00 PM. 740 delegates will participate in the convention, of which 370 shall be Railwaymen(AIRF and NFIR), 150 will be Defence Civilian employees (AIDEF and INDWF) and the rest 220 will be represented by other Central Government employees (Confederation of Central Government employees and workers). The participating organizations will issue separate circular letter indicating the number of delegates of each Branch/Unit, Divisions/Zones, Circles/States, and affiliates may deploy to the Convention.

The Staff side will meet again to finalize the draft declaration to be placed before the Convention for discussion and adoption. The date and venue of the meeting will be intimated in due course.

With greetings,

Comradely yours,
sd/-
(Shiva Gopal Mishra)

Source: http://confederationhq.blogspot.in

WELCOME MESSAGE

dear comrades,
new blog is started to discuss the cadre related issues.
soliciting kind cooperation from all the officers.