Finance Department rolls out far-reaching expenditure reforms to promote fiscal discipline

BK Web Desk/ Srinagar
February 9, 2017 0 Comments BREAKING NEWS 171 Views
Finance Department rolls out far-reaching expenditure reforms to promote fiscal discipline

The Finance Department today introduced   far-reaching expenditure reforms to promote fiscal discipline without restricting the operational efficiency of the departments and to ensure balanced pace of expenditure.

In this regard, the government has issued series of directions and set certain guidelines to be observed and followed by the departments.

As per an order issued by Commissioner Secretary Finance, Mr Navin Kumar Choudhary, 50% revenue and capital expenditure of the budget provision for 2017-18, has been released by the Finance and the Planning, Development and Monitoring Department for the financial year 2017-18.

The order maintains that the Administrative Departments shall ensure that the Budget is communicated to the Heads of Departments/executing agencies not later than 20th February 2017.  “In case this is not done, the budgetary provisions will be deemed to have been conveyed to the HoDs/executing agencies for taking further forward action,” it stated further.

The Finance department has further directed that the Administrative Departments/Heads of Departments/ executing agencies shall immediately set into motion the procurement and tendering process which should be completed latest by 15th May, 2017- which implies that all budgeted works must be allotted and supply orders issued or procurements made by the specified timeline. “Beyond 15th May 2017 any work or supply order can be issued only after the permission of the Finance Department for which the concerned department will have to submit valid and satisfactory reasons for the delay,” the government order maintains.

“Each Department shall have to ensure that the tendering process commences only after the DPRs are prepared, administrative approval and technical sanctions are accorded and any other applicable requirements have been met” the government order directs further adding “Only those works will be made a part of the capital outlay and the annual budget for which the required DPR or Project Report is completed and other necessary sanctions have been obtained”.

It has been further maintained that the preference will be given to projects which will be completed within a span of 3 years, except, of course, the mega projects like hydropower or large connectivity projects

“It shall have to be ensured that before commencing any work, it has been ascertained from the Finance or Planning, Development and Monitoring Department, as the case may be, that the required funding will be available over a period of three years to ensure completion of work” the government order further directs.

It has been further directed that ‘No re-appropriation will be allowed on the budgetary provisions made during RE 2016-17 and BE 2017-18 except to meet any shortfall in the salary provisions or for the purpose of clearing past liabilities. Such re-appropriations will be made only with the prior concurrence of the Finance Department’.

Maintaining that the phasing of expenditure during the year 2017-18 is a must, the government has further directed that the expenditure during the last quarter shall be limited to 30 percent of the budget allocation while in the month of March 2018, the expenditure shall not be more than 15 percent of the Budget Estimates.

Directing that the payments in the last month shall be made only for goods and services procured, the government has further ordered that no amounts shall be released in advance except in certain circumstances  like “Advance payments to contractors under terms of duly executed contracts so that Government would not renege on its legal or contractual obligations.   Any loans or advances to Government servants etc. or private individuals as a measure of relief and rehabilitation as per service conditions or on compassionate grounds or any other exceptional case with the approval of the Finance Department.”

The government has also directed that “Rush of expenditure on procurement should be avoided during the last month of the year so as to ensure that all procedures are complied with and there is no infractuous or wasteful expenditure.”

Similarly, Director Finance1 Financial Advisors have been advised to specially monitor this aspect in their respective departments.

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