How bloated is the Union government? A quick look at the employee strength of the Union government indicates a figure of 3.35 million employees in various central ministries at the end of the current financial year. It certainly looks less bloated when you exclude the 1.33 million people working in the Indian Railways. And for a government with an annual expenditure of close to Rs 15 lakh crore, the employee strength of 2.02 million on the rolls certainly looks less problematic.
Why should one exclude the Indian Railways’ staff strength? Well, the Indian Railways is a commercial organisation. It may receive budgetary support from the Union government, but that amount is not very huge, at about Rs 24,000 crore next year, marginally up from Rs 23,000 crore in 2011-12. Ideally, therefore, the Indian Railways’ 1.33 million people should not be included in the Union government’s staff strength.
Indeed, even the 466,000-odd employees listed under the department of posts in the ministry of communications and information technology should not be counted while arriving at the government’s staff strength. These employees will help the department of posts earn revenues of Rs 7,790 crore next year, much less than its total expenses of Rs 13,520 crore. This will require the government to fund the deficit of around Rs 5,730 crore. There is no reason why, to begin with at least, the department of posts should not be hived off as a state-owned organisation that offers postal services and has a clear target of gradually reducing its deficit within a particular time frame.
That way the government can also show its employee strength at a substantially reduced level. Of course, the number will come down further if one excludes over 957,000 police personnel working in various law enforcement agencies under the Union home ministry. In that case, the actual number of civilians working for various central ministries will come down to a relatively modest level of 600,000. Note that this figure represents an 82 per cent drop over the total government employee strength that the Budget documents trot out!
But that is not the real point here. Neither is this a strikingly new revelation, nor should this number lead us to believe that the government has achieved a lot in tightening its belt. The devil, as they say, is in the detail. First, the government’s manpower size has increased in the last one year by about 159,000. Which departments or ministries contributed to this rise? Not the Indian Railways. Believe it or not, the much-maligned Indian Railways has kept its staff strength this year at the same level as last year. Indeed, the figure will see no change even next year! Take the department of posts, which too saw no increase in its total staff strength. And in what is clearly an improvement over even the Indian Railways, the department of posts hopes to reduce its workforce by about 2,500 employees next year.
So, who did the damage? Two ministries accounted for about 62 per cent of the increase in the number of employees — police forces under the Union home ministry improved their strength from 890,000 last year to 958,000 this year and the ministry of finance raised its staff strength by over 36,400 in the last one year. It will be instructive to understand how and where exactly this increase took place.
Next year, the Union government will be spending Rs 35,611 crore on police forces, a small increase of Rs 2,300 crore over the current year. This is spent on a range of central police forces including the Central Reserve Police, the Border Security Force, the Assam Rifles, the Central Industrial Security Force, the Indo-Tibetan Border Police and the Delhi Police. The bulk of the amount is spent on their salaries, estimated at more than Rs 32,000 crore next year.
A question that the Centre must ask is: to what extent should it alone bear the expenses of such police forces? Also, will sharing their costs with states benefiting from their deployment reduce its financial burden even while strengthening the federal principles of sharing costs and revenues? Defence and internal security are sensitive issues. But such questions are not irrelevant when states are justifiably concerned over the Centre’s encroachment in areas pertaining to local law and order.
As for the finance ministry, its staff strength increased mainly because it added over 35,000 more people to its revenue department, whose primary responsibility is to collect taxes. The increase has been justified on the grounds that the various revenue collection agencies were woefully short of people and this shortage had affected recent revenue efforts. A finance minister worried over slowing growth of revenue collections may have succumbed to such arguments — although increased use and spread of technology should ideally have obviated the need for more revenue department employees.
Admittedly, both these issues are sensitive. Slashing the strength of police forces and the revenue department is politically difficult. Expecting the United Progressive Alliance government to even consider such proposals in today’s political situation is perhaps unrealistic. What, however, can be looked at is starting the process of streamlining the functioning of a few of its departments.
The external affairs ministry has already initiated an exercise in this direction by gradually outsourcing the functions of its passport division to a private sector outfit. About 20 years ago, the finance ministry had mooted the idea of outsourcing a small part of its revenue collection work to a private sector company. That proposal did not make headway because of opposition from within. It is perhaps time to look at that idea again. The idea of a public-private partnership model in the revenue department’s key functions of tax collection is worth exploring — not just to limit manpower growth but, more importantly, to improve efficiency in tax collection and offer an improved quality of tax-related services to taxpayers.
