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Finance minister asks public agencies to adhere to cost-saving measures

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Finance Minister Mehmet Şimşek said in a circular sent to all public agencies that they should re-evaluate all expenditures, except for earthquake-related expenses, adding that cost-saving measures will be strictly enforced, the state-run Anadolu news agency reported on Monday.

The circular, which was prepared by Şimşek on July 14 and sent to all state bodies on Monday, reminded the recipients of a presidential circular dated June 30, 2021 on the subject of “cost-saving measures.”

The 2021 circular emphasizes the need for cost-saving in public institutions’ expenditures, a reduction of bureaucratic procedures and effective, economical and efficient use of public resources.

The minister instructed public institutions and organizations within the scope of the 2021 circular to comply with the measures outlined in the circular regarding their domestic and international expenditures to be made from their own budgets or other sources of savings, as well as the use of both movable and fixed assets.

The expenses requiring re-evaluation exclude only the costs related to the magnitude 7.8 and 7.5 earthquakes that hit Turkey on Feb. 6, killing more than 50,000 people and leaving millions homeless in 11 provinces in the country’s south and southeast. Minister of Environment, Urbanization and Climate Change Mehmet Özhaseki said in late June that the devastating quakes caused damage in the amount of $100 billion.

Şimşek noted that the responsibility and authority to determine the necessary standards, impose limitations, make mandatory regulations and take measures to ensure efficiency, effectiveness, economy and productivity in public expenditures for all public institutions and organizations has been given to the Treasury and Finance Ministry.

According to the minister’s circular, public institutions and organizations will also ensure that their expenses, such as acquisition and leasing of fixed property, procurement and use of official vehicles, communication expenses, personnel assignments, press and publication expenses and stationary and fixed asset purchases are conducted in line with cost-saving rules.

In addition, public institutions will be obliged to comply with the rules set forth in the circular regarding representation, ceremony, hospitality, promotion and personnel expenses, as well as expenditures related to energy and water purchases, personnel shuttle services and other matters.

The circular also said administrations will report to the Treasury and Finance Ministry, through official correspondence, the savings they have achieved through their operations and transactions within the scope of the circular as well as the areas where they have the potential for further savings, through ministries and other authorities, by July 28.

“What a big U-turn!” Cem Toker, former leader of the Liberal Democratic Party (LDP), said regarding Şimşek’s move to send a circular regarding cost-saving measures to public institutions.

Toker was referring to Şimşek’s defense of the government’s spending of $1.3 billion on luxury cars and other vehicles for officials in 2015, which came under criticism, as he described it as “peanuts” compared to Turkey’s budget.

President Recep Tayyip Erdoğan named Şimşek to his cabinet in early June to tackle Turkey’s cost-of-living crisis and other strains, in a clear sign that his newly elected government would return to more orthodox economic policies after years of unorthodox moves that resulted in runaway inflation and the lira sinking to record lows.

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