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Tightening the belt is not very comfortable...
First published on the original blog ↗
The worldwide economic recession (or slowdown) primarily caused by failures in the financial markets during last year had its impact on Indian Economy too. To top it, we are experiencing drought in many parts of the country this year.
In view of the difficult times we are in, Government of India (GOI) has announced a variety of austerity measures. These include cost-cutting measures like abstinence from club class air travel, abstinence from five star jamborees and an unambiguous directive to reduce all wasteful expenditure. Following this example many ministers from central and state governments have also announced many more such measurers for cutting cost.
The spirit behind this symbolism is truly laudable. The people who spend public money should find ways to reduce fritter; at least during the time of downturn. Of course there is a value for symbolism in public life. But all the journals, newspapers and the blogosphere that I read do not appear to be excited about this symbolism. May be what I read does not represent the sentiments of the majority of the Indian Society; but reflects the pseudo sophistication of the educated urban middle class.
The sacrifices of those in power may evoke a sense of reverence which has its own advantage. It may touch a cord in the minds of the hero worshiping sentiments of a large cross section of Indian Society. The people who have learned to fathom this rustic mindset may see a benefit in this symbolism.
I am not complaining about this wooing without which it is difficult to come to political power; especially since the a significant prroporation of the middle class has anyway stayed away from their responsibility to vote.
But I can’t help raising a few questions on how this austerity measures work.
Are the benefits of this austerity quantified? If so how?
If there is truly a saving, what is done with this saving? Does it contribute to the increase in allocation to any development schemes? Or does it help to ameliorate the pain of some of those affected people? Or does it reduce the budget deficit?
Are these measures sustainable?
Who is accountable for results?
When a VVIPs takes alternate modes of transport like train and bus, does it really reduce cost or does the cost associated with additional security and disruption to common man’s daily life more than offset the same? Like late Sarojini Naidu noted ‘it costs a lot to keep this man in poverty’.
Will the implementing authority let the true spirit of cost reduction survive or let it suffocate in the technical gobbledygook? A classic example of this is the clarifications raised by the various departments including Rajya Sabha Secretariat and MOF on one of the austerity measures requiring the officers not to use the loyalty points for their private use. Print media has reported clarifications raised by many officers on the impracticability of crediting the loyalty points of the frequent flying officers to government account. If it was meant to be implemented, the guidelines could have simply asked the officers to use the available loyalty points to purchase the next ticket for his official trip. Such obvious answers don’t appear to be present in the extensive volleys of clarifications flying around. (Just Google for “Austerity, India” you will be entertained.)
We see such symbolism in corporate lives too. The corporate chieftains often come out with flavours of the season like TQM, ISO, Business Score Card, Six Sigma and so on and so forth. Although each of these can be a meaningful initiative, often these end up being fads which fail to rally the organisation.
The reasons are obvious. Firstly many of these cost cutting measures are irritants and there are strong incentives to revert at the very first opportunity. Secondly, it does not evoke conviction about its sustainability. Tightening belts can at best be a short term option whether it is to stave off hunger or to make the waistline smaller and it is often very uncomfortable.
In my opinion instead of such cost cuts (which will often creep back once it is not on the radar) genuine efforts of cost saving by better processes, sensible automation, avoidance of delays in project execution and strategic outsourcing could provide long lasting benefits.
It may even be worth to assign responsibly to a senior officer to actually work on projects that can save cost on a long term basis which get him honour and recognition instead of the plain vanilla cost cuts which often get flouted.
In view of the difficult times we are in, Government of India (GOI) has announced a variety of austerity measures. These include cost-cutting measures like abstinence from club class air travel, abstinence from five star jamborees and an unambiguous directive to reduce all wasteful expenditure. Following this example many ministers from central and state governments have also announced many more such measurers for cutting cost.
The spirit behind this symbolism is truly laudable. The people who spend public money should find ways to reduce fritter; at least during the time of downturn. Of course there is a value for symbolism in public life. But all the journals, newspapers and the blogosphere that I read do not appear to be excited about this symbolism. May be what I read does not represent the sentiments of the majority of the Indian Society; but reflects the pseudo sophistication of the educated urban middle class.
The sacrifices of those in power may evoke a sense of reverence which has its own advantage. It may touch a cord in the minds of the hero worshiping sentiments of a large cross section of Indian Society. The people who have learned to fathom this rustic mindset may see a benefit in this symbolism.
I am not complaining about this wooing without which it is difficult to come to political power; especially since the a significant prroporation of the middle class has anyway stayed away from their responsibility to vote.
But I can’t help raising a few questions on how this austerity measures work.
Are the benefits of this austerity quantified? If so how?
If there is truly a saving, what is done with this saving? Does it contribute to the increase in allocation to any development schemes? Or does it help to ameliorate the pain of some of those affected people? Or does it reduce the budget deficit?
Are these measures sustainable?
Who is accountable for results?
When a VVIPs takes alternate modes of transport like train and bus, does it really reduce cost or does the cost associated with additional security and disruption to common man’s daily life more than offset the same? Like late Sarojini Naidu noted ‘it costs a lot to keep this man in poverty’.
Will the implementing authority let the true spirit of cost reduction survive or let it suffocate in the technical gobbledygook? A classic example of this is the clarifications raised by the various departments including Rajya Sabha Secretariat and MOF on one of the austerity measures requiring the officers not to use the loyalty points for their private use. Print media has reported clarifications raised by many officers on the impracticability of crediting the loyalty points of the frequent flying officers to government account. If it was meant to be implemented, the guidelines could have simply asked the officers to use the available loyalty points to purchase the next ticket for his official trip. Such obvious answers don’t appear to be present in the extensive volleys of clarifications flying around. (Just Google for “Austerity, India” you will be entertained.)
We see such symbolism in corporate lives too. The corporate chieftains often come out with flavours of the season like TQM, ISO, Business Score Card, Six Sigma and so on and so forth. Although each of these can be a meaningful initiative, often these end up being fads which fail to rally the organisation.
The reasons are obvious. Firstly many of these cost cutting measures are irritants and there are strong incentives to revert at the very first opportunity. Secondly, it does not evoke conviction about its sustainability. Tightening belts can at best be a short term option whether it is to stave off hunger or to make the waistline smaller and it is often very uncomfortable.
In my opinion instead of such cost cuts (which will often creep back once it is not on the radar) genuine efforts of cost saving by better processes, sensible automation, avoidance of delays in project execution and strategic outsourcing could provide long lasting benefits.
It may even be worth to assign responsibly to a senior officer to actually work on projects that can save cost on a long term basis which get him honour and recognition instead of the plain vanilla cost cuts which often get flouted.