For twenty-three days, the Legislative Assembly has debated the budget endlessly raising questions, seeking clarifications and adding their notes and suggestions to various schemes of development. At the end of three weeks of discussion, the Assembly has approved with voice vote Rs 95666.97 crore worth budget as Finance Minister announced wide-ranging expenditure and fiscal reforms for the Financial Year of 2018-19. This time, and it is the first time, the budget has been presented in two parts, the Budget 2018-19 and Supplementary Grants for 2017-18 in the form of Appropriation bills. The twin bills shall go to the Legislative Council for approval after which the budget will get Legislature nod and expenditure reforms would set in. The Appropriation Bill envisaged wide ranging reforms in expenditure so as to maintain check and balances as the criterion of new fiscal policy.
The significance of the budget passed by the Assembly is to be seen in wide ranging fiscal reforms factored in the Appropriation Bill. Under new dispensation the Finance and the Planning, Development and Monitoring Department (PDMD) would release to the departments funds on both the counts meaning the budgetary grants and the grants accruing from Appropriation bills. The Administrative Departments would, in turn, ensure both revenue and capital budget to all the departments within two weeks of the passage of the Appropriation Bill. The reforms also pertain to utilization of grants for the particular work sanctioned by the PDMD with allied instructions. An important aspect of the reforms desires completion of works within the stipulated time failing which necessary administrative measures or decisions would be taken. All plans will need proper classification and no grants would be utilized unless proper classification has been approved. No payments would be made by any Treasury or Pay and Accounts Office (PAO) from April 1, under any expenditure head, if the releases for the same have not been made and further received by the spending and bill passing officers via Budget Estimation Allocation Management System (BEAMS). Treasury Officers/PAOs shall be personally liable for making payments on the funds released and received bypassing the BEAMS application.
There are a slew of fiscal reforms and owing to space constraints all of them cannot be enumerated here. However, it appears that the budget intends to do find a remedy to some of the significant and obstructions that are encountered in release of payments for the works done or still underway at proper time because the one common cause of deferred completion of works or even abandonment of works is non payment to the contractors at proper time. This difficulty is more significant in the case of Centrally sponsored schemed in which the share of the State Government is also involved. Responsibility new reforms lay emphasis on release of funds within the stipulated time and in case of failure to do so, the concerned officer shall be held responsible. In this way at least responsibility can be fixed. It is a significant reform that only such works will be authorized for execution, which has prior administrative approval, technical sanction and appropriate financial back-up. Expenditure monitoring across all departments will be done on a real time basis through PFMS.
We have been regularly laying stress on the need of bringing about financial reforms so that the pace of development is not obstructed. We are sanguine that the slew of reforms suggested by the Finance Minister will certainly improve the position of releasing funds at proper time and monitoring the progress of projects efficiently so that following instalments of funds are facilitated for release. However, it remains to be said that according to the proverb that the taste of pudding is in eating, the utility of financial reforms will be felt when these are implemented in letter and in spirit. Old habits die hard and as such for the stereotypes in the bureaucracy digesting the reforms is rather uphill task. The determination of the Finance Minister and the hawks in the department will have to rise to the occasion and understand that financial reforms were long due. Now that these have come at long last, these have to be welcomed and considered a land mark in the economic improvement of the State. The Finance Minister has said that the ultimate destination is the stability of State’s economy and that is the crux of the issue in hand.
Follow our WhatsApp channel