Give civil servants cash, not LTC to avoid graft
The government claims to have unearthed a scam, involving Rs 2 crore or more, in how its employees and those of state-owned companies use their leave travel compensation (LTC). This is a component of their income, which may be claimed after travelling and producing the tickets for the journey undertaken. The reality, sleuths tracking the case have found, is different.
In some cases, the babus involved do not travel at all, but submit forged tickets to make their claim. In other cases, people choose bizarrely complex routes — Delhi to Jaipur via Brazil being not uncommon — to inflate bills and claims. In others, people travel cattle class, but are billed as flying business, with the excess funds used to travel overseas or more often.
State-owned banks are thinking of changing the rules that govern the LTC regime, but that will not help. What could, is to scrap the allowance altogether and pay the money as a part of bureaucrats’ salaries.
There is no point, apart from ducking a little bit of tax, in distributing travel or other allowances separately from the pay cheque. All payments should be consolidated into one, the final pay cheque can be bumped up a little to compensate for the additional tax bill, and paid to public servants. With the additional money, bureaucrats can choose to travel, or eat out, or buy fancy gadgets, or simply stash it in the bank.
By earmarking chunks of salary purposewise, including the LTC, the state tries to modify employees’ spending behaviour.
For example, if it weren’t for the LTC, some people would not travel every year, as they are compelled to do now, just to claim their dues. Others might choose to fly airlines other than Air India, which is now compulsory. The government has to stop behaving like a nanny and trust its employees to spend wisely.
Read more details –http://economictimes.indiatimes.com/