In the absence of a clear directive on austerity, most ministries and divisions have reverted to spending spree since the day one of the current fiscal (2006-07).
Sources in the Ministry of Finance said the fiscal management might come under pressure if the prevailing situation is allowed to continue.
Most ministries and divisions are not complying with the austerity measures enforced last fiscal in the wake of soaring oil prices in the global market. They are in a state of confusion whether the austerity measures are still in force.
A total of 16 austerity measures were introduced in bid to reducing pressure on the government coffer. The measures helped the government save Tk 3.15 billion in the last fiscal.
"The austerity measures should be followed in the current fiscal, too, considering their usefulness and the prevailing economic situation," said a senior official of the finance ministry.
Some ministries and divisions, however, are seeking to know from the finance ministry whether they would follow the austerity measures, the official added.
The hike in the prices of petroleum products and other commodities internationally has hit many least developed countries (LDCs) including Bangladesh for the last couple of years.
With the prevailing volatility in the oil market, the government has no option but to follow austerity measures, he said.
He further said the ministry may issue a directive in this connection to end the confusion over austerity measures.
The austerity measures included 10 per cent cut in fuel supply to ministries, their divisions, departments and bodies, 10 per cent cut in entertainment and miscellaneous expenditures of both development and non-development budgets and ban on procurement of new cars for projects.
Under the same directive, the ministries and divisions were also asked to be economical in using telephone, water, electricity and gas.
Critics, however, termed such austerity measures as a mere paperwork against the backdrop of growing losses by the different state owned enterprises (SOEs) in the absence of proper reforms. Due to lack of proper guidelines, many SOEs incurred huge losses in the last fiscal.
The Biman Bangladesh Airlines alone incurred a financial loss of Tk 10 billion in the last fiscal and the Bangladesh Power Development Board Tk 9.92 billion.