BUDGET &

SPECIAL COMPONENT PLAN

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SHOULD WE BOTHER ABOUT

BUDGETS?

BUDGET

Budget of a government

BUDGET IS CENTRAL TO GOVERNANCE TOO LITTLE PUBLIC SCRUTINY OF THE BUDGET ATTENTION OF THE MEDIA LOADED IN FAVOUR OF

THEIR URBAN CLIENTELE BUDGETS ARE NOT NEUTRAL TO POLITICAL

IDEOLOGIES AND STRATEGIES ECONOMICALLY AND SOCIALLY WEAKER SECTIONS OF

THE POPULATION ARE MOST VULNERABLE TO NEGLIGENCE IN THE BUDGETS

BRIDGING THE GAP BETWEEN PEOPLE AND THE GOVERNMENT

UNDERSTANDING THE BUDGET IS KEY TO PARTICIPATION IN THE BUDGET PROCESS

Union Budget of India• How is the Union Budget Prepared?• Does Union Budget influence the Budgets of States?• Can we understand State Budget papers?

Looking at Budgets through a specific lens• Schedule Caste Sub Plan

Today’s Discussion

Every Budget broadly consists of two parts

Expenditure Budget

Typically Services Provided by Government:

General Services,

Economic Services and

Social Services

Receipts Budget

Collection of funds through various kind of receipts

Corporation Tax Personal Income Tax Wealth Tax Customs Duties Sales Tax Service Tax Interest receipts Earnings from

Disinvestment Fees/ User Charges Debt

The Union Budget

A Constitutional Obligation Article 112 provides that the President

shall, in respect of every financial year, cause to be laid before Parliament, ‘Annual Financial Statement’;

Article 265 provides that no tax shall be levied or collected except by authority of law;

Article 266 provides that no expenditure can be incurred except with the authorisation of the Legislature

How is the Union Budget Prepared? Preparation of the Budget Enactment of the Budget Execution of the Budget Legislative Review of the Budget

How is the Union Budget Prepared?

Formulation

Budget making generally starts in the month of August/September each year

The Budget Division of the Department of Economic Affairs of the Ministry of Finance sends a circular to various Ministries/Departments – Estimate of Exp

The Ministry, undertakes the process of compilation and co-ordination of estimates of expenditure of different Ministries/Departments

Finance Minister – Planning Commission - Cabinet

Enactment

Presentation of the budget by the Finance Minister in both the Houses of Parliament

General discussion on revenue and expenditure proposals

Presentation of demands for grants, and Voting and passing of the Appropriation

and Finance Bills

Implementation

Once the Finance and Appropriation Bills are passed

Government can collect revenue and spend money on approved schemes

Audit

Controller General of Accounts (CGA) oversee the department wise accounts of the Union Government

Public Accounts Committee Estimates Committee Committee on Public Undertakings

Union Budget Documents

1. Budget Speech of the Finance Minister 2. Annual Financial Statement 3. Demand for Grants by the Ministries/

Departments 4. Finance Bill 5. Expenditure Budget Volume I 6. Expenditure Budget Volume II 7. Receipt Budget 8. Detailed Demands for Grants 9. Implementation of Budget Announcement 10 Performance Budget

http://www.indiabudget.nic.in

Having a Specific Lens

Special Component Plan for Scheduled Castes (SCP for SCs) and a Tribal Sub-Plan (TSP) was introduced in 1979

The strategies of SCP and TSP are meant to ensure that outlays and benefits from the general sectors of the Plan flow to Dalits and Adivasis at least in proportion to their shares in total population

Objectives of SCSP & TSP

Sustainable reduction in poverty and un-employment

Creation of productive assets in favour of SC and ST to sustain the growth through development efforts

Human resource development of SC and ST by providing adequate educational and health services, and

Provision of physical and financial security against all type of exploitation and oppression

Component of SCSP & TSP

Only those schemes which ensures direct benefits to individuals, families of SC/ST

Area oriented schemes directly benefiting SC/ST hamlets/ villages having majority of SC/ST population

Priority for basic minimum services like primary education, health, drinking water, nutrition, rural housing, rural electrification and rural link road

Schemes to develop agriculture and allied activities like animal husbandry, dairy development, vocational training, etc. that provide a source of livelihood to the SC/ST population should be included

Innovative projects that draw upon institutional finance to supplement plan allocations may be drawn up

Planning Commission Guidelines Only those schemes should be included under

SCP/ TSP that ensure direct benefits to individuals or families belonging to SCs/ STs

Funds should be earmarked for SCP/ TSP from the Central Government Ministry’s/Department’s Plan outlay at least in the proportion of SC/ ST population to the total population of the country

Special Component Plan and Tribal Sub-Plan funds should be non-divertible and non-lapsable.

Planning Commission Guidelines The funds earmarked for SCP/ TSP should be placed

under separate budget head/ sub-head for each Ministry/Department for implementing SCP and TSP

Outlays for area-oriented schemes directly benefiting Scheduled Castes hamlets/ villages having a majority of Scheduled Castes population/ tribal hamlets and villages shall be included in SCP and TSP

Wage component, especially under rural employment schemes, should not be included under SCP/ TSP

Non-earmarking of funds under SCP and TSP may result in non-approval of Plans of the States/UT

Maharashtra Model

Earmarking funds for SCP and TSP from the total State Annual and Five Year Plan outlays at least in proportion to their respective population in the State

Designate the Social Welfare or Tribal Welfare Departments in the State as nodal departments for the formulation and implementation of SCSP and TSP with full autonomy in the selection of schemes, allocation of funds and diversion of funds from one scheme to another within the overall allocations

Maharashtra Model

These nodal departments to be entrusted with responsibility to take all policy decisions regarding administration of development programmes, including budgeting of funds, release of allocations for development schemes and powers to review, monitor and supervise the implementation of all the programmes for the SCs and STs

Effective monitoring of the implementation of various schemes under SCP and TSP of all departments

Social Justice Ministry

Educational Facility 26 schemes

Economic Development 10

Housing 2

Other Schemes

Development Heads

Outlay is divided into State and District

Agriculture and allied services Rural Development Electricity Industry and minerals Transport and Communication Social and community services

Implementation Gaps

Certain departments not earmarking funds under SCSP from their regular budget;

Certain depts. not in a position to spend the budget allocated under SCSP and thus, the budget getting lapsed;

Non-adherence to the guidelines of Planning Commission by the Line Depts.;

Non-submission of proposals by the Line Depts. to Finance Dept. in time for re-appropriation of funds;

Lack of co-ordination among Line Depts. Social Welfare Dept. and Finance Dept. regarding the implementation of schemes under SCSP

Steps for Action

Budget Analysis Budget Tracking and Performance Monitoring & Advocacy

Budget Analysis

Obtaining copies of the budget document and other relevant materials

Understanding the government’s programmes and priorities

Dissemination Engage people in Debate & Dialogues

VOLUNTEERS:

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Priyadarshi Telangpktelang@gmail.com

9673313177