Austerity measures and curbs on unnecessary govt spending

Against the backdrop of the current fragile economic situation the dire need for austerity measures in every sphere of national life cannot be over-emphasized; ensuring every taka is spent and utilized for the specific purposes it is meant for. In these testing times when economists are predicting a recession, it’s always prudent to shake off complacency and adopt austerity measures. The PM has repeatedly underlined the need to cut down expenses and urged everyone to tighten their belts.

Particularly, the acute ongoing energy crisis is posing a serious threat to Bangladesh’s economy. At present, the demand for electricity in the country ranges between 14,000MW and 14,500MW. But due to the crisis of gas imported from international sources, the government is producing 12,000-13,000MW. Taking this situation into consideration, from Tuesday, the government announced up to one hour of load-shedding across the country.

The authorities can urge the people to live moderately; yet the actual change will come when there is a nationwide belt-tightening. When the government calls for austerity measures it is government functionaries who should set the example. According to an agency report carried in this newspaper on Thursday the government has decided to reduce the use of electricity by 25 per cent at all its offices to save power for the future. This is indeed a welcome development The decision came at an emergency meeting of secretaries of all ministries and departments held at the Prime Minister’s Office on Wednesday.

In the meeting, it was decided to adopt a number of other measures as part of the government’s austerity drive. The report says that the Finance Division will publish a gazette to use 20 per cent less fuel allocated for the concerned offices. Virtual meetings will be preferred to physical ones.

Experts and common people have often expressed their dismay about frequent and often apparently unnecessary foreign travels by government officials. This unwelcome phenomenon has continued despite the economy facing turbulent times. Finally at the meeting in PMO it has been decided that foreign travels should be avoided unless those are for important reasons. It remains to be seen whether this decision is properly implemented.

The government plans to strengthen measures against hoarders and ensure market monitoring to keep the prices of daily essentials stable. Again, similar directives have come from the powers that be time and again. Unfortunately, lax implementation of such diktats has yielded little result in the past. It is not normal times now. Stringent measures should be taken to keep commodity prices within the reach of the common people.

There is no other way but to take measures to save electricity and prevent wastage. Cost-effective load shedding is a temporary tool for the government. The alternative to load shedding is to increase the price of gas and electricity. But the extra price will create limitless pressure on the consumers. However, several experts have expressed their concerns about the effectiveness of the recent measures taken by the government. Experts say that load management has to be done in such a way that the economic shock is minimal. Load shedding was unavoidable but other areas must be addressed as well.

The authorities concerned must take a firm decision about the captive power plants. Though the government shut down all diesel-fired power plants due to low fuel stocks, it is obliged to pay their capacity charges. Bangladesh Power Development Board (BPDB), the country’s sole electricity buyer, data shows that this exercise has been a huge drain on our limited resources. The capacity charge is a trap that the government must find a way to get out of. We believe that the government should urgently renegotiate the terms with power plants to stop capacity payments.

Wherever electricity can be saved, measures must be taken. There are electric billboards on various roads and highways in the capital and plans should be made to close them on time. Effective initiatives should be taken to stop illegal connections to reduce system losses that have been plaguing the sector for years. Emphasis should be laid on increasing domestic gas production.