February 19, 2013
NEW DELHI: In many towns and villages across the country, government dispensaries and hospitals have the latest equipment but no doctors or nursing staff. Often government schools have students, but no teachers. But in Delhi, there is no dearth of government employees — from peons to clerks and officers — to handle the ever-expanding list of ministries and regulatory agencies.
February 19, 2013
NEW DELHI: In many towns and villages across the country, government dispensaries and hospitals have the latest equipment but no doctors or nursing staff. Often government schools have students, but no teachers. But in Delhi, there is no dearth of government employees — from peons to clerks and officers — to handle the ever-expanding list of ministries and regulatory agencies.
The cash-strapped government is fighting to restore the health of its battered public finances – and even contemplate measures like taxing the super rich – but there is hardly any talk of downsizing the government.
Check out how much the government can save by even a 5% cut in employee strength. In the current financial year, it has budgeted to spend over Rs 1.15 lakh crore in salaries, allowances and travel bill to 34.1 lakh employees. A 5% cut will result in a saving of nearly Rs 6,000 crore, which is five times the Centre's budgeted wealth tax collection. A 10% reduction will translate into savings of Rs 12,000 crore, which is over 6% of its budgeted income tax mop up for the current fiscal.
Ten years ago, the government roughly had the same number of employees (32.2 lakh) and spent Rs 31,000 crore in paying their salaries, allowances and travel bill. While the government has maintained a freeze on fresh hiring for the past several years, it has increasingly depended on contract workers for odd jobs, which has also added to expenditure.
In 2000-01, the government set up an expenditure reforms commission which delivered 10 reports recommending sweeping changes to cut down flab. But 13 years on, the reports are virtually forgotten with negligible progress on the recommendations. While experts say it is difficult to put a figure on the savings from downsizing, they say it is necessary to raise efficiency and effectiveness in delivering public services.
A back-of-the-envelope calculation shows that each middle-level officer costs the government more than Rs 2 lakh a month, which includes salary, phone, car and fuel bill, subsidized accommodation and medical benefits. The office set up includes at least two-three peons, one or two personal assistants, "depending on the work load", and a private secretary.
Government ministries have added officers, who often duplicate work assigned to regulatory bodies. In 2004, the number of central ministries totaled 42, but now the size has gone up to 53. Add to this the innumerable departments and standalone offices and you have layers of bureaucracy, often without any meaningful work while some crucial wings such as the tax department face acute manpower shortage.
Take, for instance, the infrastructure and the financial sector. Over the past decade, the two sectors have seen new regulatory entities. Yet, the size of government departments and ministries has only increased.
In the early '90s, along with economic liberalization, the government set up the Securities & Exchange Board of India but the finance ministry still continues to have a capital markets division — with at least 19 officers — to coordinate with the markets regulator.
The insurance regulator, IRDA, has been set up but the finance ministry's financial sector division retains the entire set up. Similar is the case for pension and banking, where the size of the bureaucracy has increased.
The story is the same story in infrastructure. The power, roads, shipping and aviation sectors are quite some distance from bridging the yawning gap in supply and demand but when it comes to creating posts none of them have gone slow. So, there is the electricity regulator at the Centre and the state levels — almost all headed by retired government officers who were instrumental in setting these up — while the power ministry continues to plan to bridge the gap.
The aviation ministry exists despite an airport regulator, Airports Authority of India and Directorate General of Civil Aviation for airport safety. "The problem is that no one is willing to give up power. The infrastructure ministries are the worst offenders since they are creating multiple agencies," says a senior government official.
"What were earlier divisions in a ministry (headed by a joint secretary) are now full-fledged departments (with a secretary and several joint secretaries)," says a former expenditure secretary. Then, there is the list of ministries which have lost their relevance due to economic liberalization. Textiles and steel ministries can be cited as examples of entities that can be wound up or whittled down.
"Why do we need a steel ministry? The steel sector is privatized. The Steel Authority of India (SAIL) is a navaratna and fairly autonomous," said Kirit Parikh, former Planning Commission member and member of the Expenditure Reforms Commission. "There are many departments and ministries we don't need. Civil aviation and even textiles can be trimmed," he said.
Parikh said the rise of coalition politics had given way to an increase in the number of ministries and departments to keep coalition partners happy. "Everyone likes a PSU (public sector undertaking) under their wings," Slashing any government department will trigger stiff opposition, he said. To accommodate coalition partners, there is a bloated council of ministers and layers of junior ministers. This has also meant carving out ministries from existing ones or creating fresh departments.
In the late '90s, the industry ministry was split into the department of industrial policy and promotion, which is part of the commerce and industry ministry. And to top it all, there is a separate ministry for heavy industry and public enterprises, and another one for micro small and medium enterprises. The labour and welfare department has also been split into several ministries ranging from social justice and minority affairs to disability affairs. The list is endless.
Most countries do not have a telecom department as independent regulators do the job. But India has gone step forward and set up a department for information technology.
There are more bizarre examples. There is technical advisor for boilers in the commerce and industry ministry despite the Boilers' Act being repealed. The ministry also has an entire wing dealing with explosives although it has limited control over states. And the office of the directorate general of foreign trade (DGFT), which earlier regulated imports, is in full strength despite all imports being freed.
Courtesy: TOI
