’Are you running circus’: Congress reacts after Centre rolls back rate cuts on small savings

Shortly after the central government withdrew orders to cut the interest rate on small savings schemes, Congress on Thursday lashed out at Union finance minister Nirmala Sitharaman, stating that she no longer had any moral rights to continue as the FM.

The opposition party said that one can imagine the functioning of the economy when such duly approved order affecting crores of people can be issued by an "oversight".

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The finance ministry had on Wednesday reduced interest rate by up to 1.1% across various small savings schemes, including the National Savings Certificates (NSC) and Public Provident Fund (PPF).

However, Sitharaman on Thursday said the government will restore the rates to the last quarter of the financial year ending on 31 March.

"Interest rates of small savings schemes of GoI shall continue to be at the rates which existed in the last quarter of 2020-2021, ie, rates that prevailed as of March 2021. Orders issued by oversight shall be withdrawn," Sitharaman said in a tweet.

Reacting to the development, Congress leader Priyanka Gandhi Vadra tweeted, "Really @nsitharaman 'oversight' in issuing the order to decrease interest rates on GOI schemes or election driven 'hindsight' in withdrawing it?"

Congress' chief spokesperson Randeep Surjewala also slammed Sitharaman and asked whether a "circus" or a government was being run.

"Madam FM, Are u running a 'Circus' or a 'Govt'? One can imagine the functioning of economy when such duly approved order affecting crores of people can be issued by an ‘'oversight," Surjewala tweeted. "Who is the competent authority referred in order? You have no moral right to continue as FM," he said.

Congress leader and former Finance Minister P Chidambaram also came down heavily against Sitharaman's statement and said such an announcement is a regular exercise. "There is nothing “inadvertent” about its release on 31 March," news agency ANI quoted Chidambaram as saying.

"The BJP government had decided to launch another assault on the middle class by slashing the interest rates and profiting itself. When caught, the FM is putting forward the lame excuse of "inadvertent error"," he added.

Chidambaram added that the current interest rate on saving schemes is still lower than the inflation rate and thus "hitting the savers and the middle class below the belt".

"When inflation is at about 6% and expected to rise, the BJP government is offering interest rates below 6% hitting the savers and the middle class below the belt," the Congress leader said.

Rate of cut

According to an office memorandum of the finance ministry issued on Wednesday, the rate of interest for savings deposits was reduced from 4% to 3.5% annually.

The rate of interest for the Sukanya Samriddhi Account Scheme was also reduced from 7.6 to 6.9%.

The other schemes (with annual compounding frequency) for which interest was reduced include Public Provident Fund (reduced from 7.1 to 6.4%) and for National Savings Certificate (6.8 to 5.9%). The rate of interest was also reduced for the Senior Citizen Savings Scheme, Kisan Vikas Patra and the five-year recurring deposit.