The Finance Division has taken this decision as revenue earnings declined at this time when there is a pressure of additional expenditure on the government to deal with the ongoing coronavirus situation
The government has imposed a ban on purchase of vehicles for all its officials until December 31 as part of its austerity measures during this pandemic.
State-owned banks, insurance companies, financial institutions, public universities and other autonomous and semi-government institutions will also not be allowed to buy new vehicles for their employees during this time.
The Finance Division has taken this decision as revenue earnings have declined at this time when there is a pressure of additional expenditure on the government to deal with the ongoing coronavirus situation.
The purchase of all new and re-conditioned vehicles will remain suspended under operating and development expenditure till December 31 this year to make space for Covid-19 related expenses, according to a circular – signed by the joint secretary to the Finance Division Mahfuzul Alam Khan – issued on Thursday.
As part of its spending cuts, the government has also suspended funding for low-priority projects under the Annual Development Programme for the 2020-21 fiscal year.
Ministries and divisions will spend money only in those areas of medium-priority projects where it is deemed necessary. Expenses must be avoided where possible. However, the implementation of high priority projects will continue.
Most cars bought by the government are for development projects. Around 40-50 cars are purchased for a big project. Over 50 vehicles have been purchased for the Padma Bridge project. The number of vehicles for the Chattogram-Dohazari rail link project is more than 40. And the number of vehicles is two or three for a small project.
According to the officials of the Planning Commission, 10 vehicles are bought on average for a project.
Planning Commission officials said about 300-350 projects are approved by the Executive Committee of the National Economic Council every year, meaning that 150-185 projects are approved every six months.
As such, about 1500-1650 new cars are bought in six months for various development projects in normal times.
A finance ministry official said the decision would stop the purchase of new cars and replacement of old ones not only for government employees, but also for all state-owned organisations, including banks and financial institutions, public universities, law enforcement agencies and new and old development projects.
Along with the money for buying the vehicles, spending on drivers, fuel and maintenance of these vehicles will also be saved, he added.
An official at the Department of Government Transport said two projects were underway to procure 52 sedan cars of 1500cc for use by secretaries of different ministries, and 83 of 1300cc for additional and joint secretaries. With this ban, the purchase of the vehicles has got stuck.
He said the department has a plan to replace at least 50 old vehicles in the central transport pool every year and at least two in each district.
At present, there are 505 vehicles of different makes and models in the central transport pool. Besides, there are 25 cars, 476 jeeps, 64 microbuses and 34 pickups in 64 districts of the country.
There are two cars, 27 jeeps, seven microbuses and seven motorcycles in the offices of the seven divisional commissioners, and 486 jeeps in the upazilas.