Better governance helps Foreign Ministry cut costs, improve savings

Tuesday, 21 July 2015 01:51 - - {{hitsCtrl.values.hits}}

The Ministry of Foreign Affairs has managed to slash costs by Rs. 790 million or 16.6% in the first six months of 2015 ending in June, with a huge chunk of that saving comprising reduced foreign travel by the President.

Cumulative costs incurred by the Ministry from January-June 2015 stand at Rs. 3.96 billion, down from 4.75 billion during the same period last year.

The Ministry could record a projected savings of up to Rs. 1 billion by the end of the year. 02-3

According to accounting documents obtained by the Daily FT, expenses incurred for foreign travel by the President from the Foreign Ministry budget has seen a reduction of Rs. 132.7 million in the first six months of 2015, to 46.8 million, down from 179.5 million in the same period for 2014 or a whopping 74% saving.

The Ministry has also managed to reduce fuel costs by 37%, down from 78.8 million in January-June 2014, to 49.5 million in the same period this year.

There has been a 15.2% or Rs. 109 million saving in rent allowances alone, down from 716 million between January-June 2014 to 607 million in the same period this year.

Significant reductions in expenditure have also been recorded in the postal and communications sections of the Ministry and domestic and foreign travel.

Conversely, the focus at the Ministry of Foreign Affairs has been staff training, with the accounts from January-June 2015 showing an increase of 141% in training expenses, up from Rs 1.01 million in 2014 to 2.45 million in the same period this year.

The significant drop in expenditure on rent allowances could be a result of the recall of additional postings created in foreign missions overseas for political friends and families. Many postings were created during the previous administration above the approved diplomatic cadre allocated for overseas missions, the Daily FT learns.

Every year in the past five years, expenditure has been highest in the months of September, when large entourages would accompany the ex President to the United Nations General Assembly sessions in New York.

Expenses registered in the unspecified ‘others’ column of the accounts has also seen a dramatic decrease in the six months ending June 2015.