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Will this profligacy end?

D. S. Soman

IN A FIT of generosity, reminiscent of the feudal age when, at times, the pleased ruler bestowed favours, the Communications Minister, Mr. Ram Vilas Paswan, gifted rent-free telephones to all the employees of the Telecom Department. They have been exempted from registration, rental or installation charges and will also be allowed 150 free calls during the bimonthly cycle.

The Minister has topped this gift with a bonus of 70 days' pay for 1999-2000. By a modest estimate, the rent-free telephone facility will cost the exchequer Rs. 70 crores, annually. This does not take into consideration the installation charges and the d eposit which the government will forego. It is logical to assume that the employees of the Department will be allowed to use this facility even after retirement.

This is not the first time the Government has been over-generous without any provocation. The earlier occasion was the settlement over pay-scales with the staff federations, following the Fifth Pay Commission's report. The federations felt that the salar y structure suggested by the Fifth Pay Commission needed to be revised upward. They were pitching for a hike of 15 per cent, hoping the Government would at least concede a rise of 10 per cent. The then Prime Minister, Mr. Inder Kumar Gujral, however, in a mood of magnanimity, upped this rise to 40 per cent. Both the Central and the State governments have still not recovered from the blow.

Thus, the Centre's pay bill accounts for 19 per cent of the Union Budget. In Maharashtra, salaries of government servants gobble up 73 per cent of the State revenues, leaving little scope to fund development projects.

Mr. Paswan's gesture has recalled old memories. It is interesting to note that the staff federation had not asked for rent-free telephones. Yet, the Minister found it desirable to bestow this favour upon them. As things stand, retired officers of the tel ecom department already enjoy the facility of rent-free telephones.

The new facility is expected to boost the morale of the employees working in this Department. Whether that will happen is doubtful. But one thing is certain. Just as providing residential accommodation to the staff has become a source of additional inco me (by renting out a part of it to paying guests -- as the expression goes), the new facility will enable the staff open mini-telephone booths in their houses and earn additional income.

It is not fanciful to say that in the days to come, one can expect to see queues in front of the telecom employees' houses. This, in addition to their `income' for installing telephones, as part of their deal with the customer. To misuse any facility is second nature to most people and this will be no exception.

It is not clear whether this installation will be done on a priority basis, or will have to take its turn, along with the general, paying public. For, demand for telephones has always outstripped supply. There is still a long queue of people wanting tele phone lines, on payment. It will not be uncharitable to presume that the Telecom Department will give priority to the installing lines for their employees. That is natural. After all, `charity' must begin at home!

The common man may be paying huge amounts to rectify the wayward service provided by the Telephone Department. For example, at least 30,000 telephone lines are down in Mumbai, following the unseasonal rains in May. These are yet to be activated. This, wh en the monsoon has not really hit the city.

Whatever services are provided in the public sector, including by the government departments, they are primarily meant for the benefit of its employees. The general public is only allowed to partake of its benefits. Thus, hundreds of employees and their families are found flying either Air-India or the Indian Airlines. The airline staff has become so brash, they demand the employees and their families be accommodated at any cost. Who could have missed the recent spectacle of an Air-India pilot insisting on flying families of the staff members, in preference to the scheduled passengers.

It speaks volumes for the discipline in the airlines sector that the management could do precious little when the fare-paying passengers were offloaded. The same goes for the Railways. Hundreds of its employees and their families travel on free passes or concessional tickets -- this when the ordinary passenger manages to squeeze in, after paying the usual fare.

In justification, it is said that private companies also extend concessions to their staff. To some extent, this is true. But they are not as generous the public sector organisations. Because, pursuing the same logic, each worker in Maruti Udyog Ltd shou ld be entitled to a car or at least a free-run for at least 1000 km per month!

These concessions are subsidies in another form which benefit only a certain class. Much hue and cry is raised against subsidies and a conscious attempt was made in the Budget to roll back some of them, partially. It is curious that some political partie s still insist on these subsidies, knowing full well that they do not reach the target segment.

The Prime Minister backed the decision to cut some subsidies -- a fraction of the total. The Finance Minister has been making a valiant effort to plug loopholes in government revenues and to mobilise resources. The largesse, like the one doled out by Mr. Paswan, does not aid such measures. It is strange that the Prime Minister is not able to rein in a colleague who has gifted Rs. 300 crores (Rs. 1,200 crores, according to some).

As it is, telephone density in India is poor -- at 2.7 per hundred. Communication is at the heart of developmental activities. Instead of paying attention to augmenting the supply of telephones and strengthening the infrastructure, ministers are f rittering away resources in populist measures. Measures such as this one, is an invitation to profligacy. The nation can ill-afford it, when all resources need to be concentrated in development. It is time, the Prime Minister called a halt to such methods of gaining popularity.

This populist measure comes at a time when the World Bank has come down heavily on India's fiscal policy. At a donors' meeting in Paris in May, a senior official of the Bank warned of the ``horrifying'' budget figures that undermine the government's role in promoting development. ``Expenditure composition is deteriorating towards salaries, pensions and interest payments. Revenues are falling. Subsidies remain large. Many initiatives to address these problems have been announced but implementation is sti ll to come,'' Mr. Edwin Lim, the Bank's India director, was quoted as saying by the Financial Times (May 25). This warning should be ignored only at our peril. It may do well to remember that the economic reforms, started in 1991, came as a result of the pressure from the World Bank. There is need for more discipline in government working and better accountability. There is a lot of talk of corporate governance in the private sector. In contrast, the public sector seems determined to act as it pleases, regardless of the consequences.

(The author is a former Director-General of Police, Maharashtra.)