New Delhi: On the day that it approved the anti-graft Lokpal Bill, the first murmurs of dissent against finance minister P. Chidambaram’s call for expenditure cuts surfaced in the Union cabinet—over the seemingly piffling amount of Rs.90.38 crore.
The cabinet eventually overruled the finance ministry’s objections and approved the infusion of the money for the financial restructuring of state-owned Scooters India Ltd, based in Lucknow.
The version of the Lokpal Bill approved by the cabinet may, however, stir up political controversy after it left out a key recommendation to bring the Central Bureau of Investigation (CBI), the country’s premier investigative agency, within its purview.
The country’s main opposition Bharatiya Janata Party (BJP) and anti-corruption activist Anna Hazare signalled their displeasure with the government’s move. The Bill relates to the appointment of anti-corruption ombudsmen.
But for this, the version approved by the cabinet comes very close to mirroring the one approved by the select committee of the Rajya Sabha; it accepted 14 out of 16 amendments.
The Bill, which was at the centre of a nationwide anti-corruption movement led by Hazare last year, was passed by the Lok Sabha in December 2011. The United Progressive Alliance (UPA) government is likely to seek the approval of the Rajya Sabha first before seeking the nod of the Lok Sabha again (because changes have been made in the Bill) in the forthcoming budget session itself.
Sections 63 to 97 of the Lokpal and Lokayuktas Bill 2011, referring to the appointment of the ombudsmen in the states, will be deleted. But a provision will be included that requires states to pass Lokayukta Bills within 365 days after the passage of the Lokpal Bill in Parliament, said V. Narayanasamy, minister of state in the Prime Minister’s Office.
The revised draft excluded religious and charitable institutions receiving donations from the public and aided by the government from the purview of the Bill, but included those financed by the government.
The cabinet rejected the recommendation on seeking the approval of the anti-graft ombudsman for the transfer of CBI officers probing cases referred by the Lokpal. “It will affect the smooth functioning of the CBI,” the government said.
Rejecting the parliamentary panel’s view, the government has incorporated provisions that allow public servants to defend themselves before deciding whether there is a prima facie case for ordering a probe.
“Their views have to be heard. It is possible that they have some documents which prove that the allegations against him are wrong,” Narayanasamy said.
The cabinet meeting chaired by Prime Minister Manmohan Singh also witnessed exchanges between ministers backing the issue of ID cards as part of the National Population Register (NPR) programme, and those who argued that the unique identification (UID) would suffice.
Eventually the cabinet deferred signing off on the Rs.5,500 crore resident ID card project.
The argument began after home minister Sushilkumar Shinde moved the proposal, saying the NPR cards could not be duplicated and, therefore, offered a higher level of security.
Jairam Ramesh, Praful Patel, P.K. Bansal and Kumari Selja countered on behalf of UID. Rural development minister Ramesh said the UID could be used in conjunction with smartphones to authenticate a person.
Given the sharp divide in the cabinet, the Prime Minister eventually opted to refer the matter to a group of ministers.
Separately, the cabinet also approved the proposed amendments in the Regional Rural Banks Act, 1976, to enhance authorized and issued capital to strengthen the capital base of the lenders. The term of the non-official directors appointed by the central government is proposed to be fixed, not exceeding two years. The move is expected to ensure financial stability of the rural banks and allow them to play a greater role in financial inclusion.
The cabinet committee on economic affairs cleared the fair and remunerative price of sugar cane payable by sugar mills for 2013-14 sugar season to be fixed at Rs.210 per quintal and partially allowed the export of certain edible oils, including coconut oil from domestic tariff areas to special economic zones.
It also allowed state-owned ONGC Videsh Ltd to acquire a participating interest held by Hess Corp.’s wholly-owned subsidiaries in the upstream and midstream oil and gas assets in Azerbaijan.
Madan Sabnavis, chief economist at Care Ratings, said the expenditure compression that the government is seeking is the correct approach. “Since we have little control over revenue collection, we have to cut down on government expenditure to meet the fiscal deficit target. And going for superfluous expenditure like resident identity cards can be avoided since we have not properly thought it through,” he added.
As a sign that the government is significantly compressing its Plan expenditure to meet the revised fiscal deficit target of 5.3% of gross domestic product for the current fiscal ending 31 March, Controller General of Accounts data released on Thursday showed that in the first nine months of the current fiscal to December, ministries have spent only 56.8% of their allocated fund under Plan expenditure against 62.7% in the year-ago period.