Government unveils savings measures package

ANKARA

Vice President Cevdet Yılmaz and Finance Minister Mehmet Şimşek have unveiled savings measures package aimed at increasing efficiency in the public sector.

The measures have three main pillars: Public savings, discipline in the budget spending and efficiency in public investments, Şimşek said at a press conference in Ankara.

“We will support disinflation through savings and spending control in the public sector,” Şimşek said, reiterating that the government’s priority is to lower inflation, bringing it to single digits.

Monetary policy, revenues policy and structural reforms are carried out in harmony in the fight against inflation and the Central Bank is taking all kinds of measures, including tightening monetary, to reduce inflation, the minister added.

“We will contribute to the disinflation process with the package we unveiled today and other measures we will announce soon,” Şimşek said.

The annual inflation rate quickened from 68.5 percent in March to 69.8 percent in April, according to the latest official data.

As part of the package announced on May 13, public institutions' new vehicle purchases and rentals have been paused for three years, except for defense and security needs.

The purchase and construction of new buildings will be stopped for three years, except for those at earthquake risk, and renting new buildings will not be allowed, according to the minister.

“For this year, we are cutting 10 percent in goods and service purchase allowances and 15 percent in investment allowances, excluding earthquake and compulsory expenditures,” Şimşek furthered.

There will be limits to payments made to state employees at the company boards, he said.

“In the public sector, we will recruit as many new personnel as retired ones for three years. We aim to reduce the number of support staff over time. We will further develop flexible, remote working models in the public sector,” the minister said.

Energy efficiency in the public sector will be increased with new steps regarding the use of renewables, according to Şimşek.

Without any exception, all public institutions and personnel must comply with the savings measures, and a “very strong monitoring, supervision and sanctions model” will be implemented, he said.

Central administration, local administrations, state economic enterprises and all funds are within the scope of the public savings measure package, the minister added.

This was not the first nor the last package they will announce, as more measures will be taken, Şimşek vowed.