The annual financial statement popularly known as the Budget for the year 2010-11 was presented by the Chief Minister and subsequently passed by voice vote during the recently concluded Nagaland Legislative Assembly session. Firstly, on the revenue side, it is not unusual to see that the State continues to depend overwhelmingly on Central assistance. And as usual the latest budget is once again devoid of any fresh taxes. This does not make economic rationale. The government machinery would have to really get itself into a combat mode to generate commensurate revenue because unless revenue collection improves, the State finances would be hard pressed to sustain its expenses. And as rightly pointed out by the Chief Minister himself on revamping revenue collection, as the head of the government, he should strictly monitor the revenue generating departments and ensure that there is no leakage or fund diversion. With a major chunk of money going away to support Non-Plan Expenditure, the Chief Minister has finally done the right thing to call for austerity measures. During the Budget Session, Rio announced that the government had taken the decision to put a ban on new post creation, and upgradation, purchase of new vehicles, furniture except in emergency cases. However how well such a plan is put into action is something that we will have to wait and see. Besides the above area, all other populist measures and unnecessary wasteful expenditure must be cut. This may include among others curtailing road shows, banquets, foreign travel etc. When it comes to public money we need to ensure that every penny is accounted for and resource is well distributed without any pilferage and wastage.
In fact ever since the austerity measure announced by the Prime Minister of India Manmohan Singh and the Congress President Sonia Gandhi, this column had also suggested that our Ministers and VIPs should also follow cost cutting exercise whether we call it austerity, self restraint or simply put: curtailing our expenditure. We are living beyond our means. We only know how to buy and spend not sell and earn. This is poor economics. Besides the corruption within the system is only adding to the cost. Our VIPs right from the Chief Minister, Minister, Parliamentary Secretary, top ranking administrative and police officials all enjoy lifestyles befitting a king—expensive cars, posh homes, Hi-Fi gadgets just to name a few. It will not be a surprise if austerity turns out to be a complete failure in Nagaland. Austerity should not be only about banning job creation or buying a less expensive vehicle. It should also include better utilization of public resource including funds meant for development. The austerity announced by the CM will hopefully not be mere tokenism although the timing of it coming as it does after a generous hike in salary and other allowances for our politicians, has put doubt on the credibility of the exercise. Besides curtailing wasteful expenditure, which has been announced, austerity should also involve good governance, fiscal discipline and strengthening delivery system so that we achieve holistic development while keeping the State’s financial condition healthy. Let’s hope that the austerity drive announced by the Chief Minister will lead to positive outcome for the economy and people’s welfare.
