FINANCIAL BUDGET:- (All you needed to think about the Budget)

“The Budget division in the Finance Ministry has complete responsibility over the document”

“An Annual Budget is not only necessary, but compulsory according to the Constitution”

What is a budget and what does it consist of?

A #Budget is an estimate of outflows and inflows that a Government will incur during a financial year. It consists of actual figures for the first year and the budgetary estimate for the present year. For example, a Budget presented in Feb 2019 will have the preceding year, i.e. 2018-19’s actual figures and the evaluations for 2019-20.

When is it presented and by whom?

The Budget is introduced on a day that is determined by the Parliament. While generally it was displayed on the last working day of February, this year, because a new government has come into power, it will be presented on 1 February.

The Budget is presented by the Finance Minister. The Budget division in the Finance Ministry has total duty over it, however it requires last endorsement from the Prime Minister.

A timetable is drawn up by the Budget Advisory Committee of the Parliament. In this calender, a settled time is given for every Ministry to talk about their requirements preceding the Budget introduction.

Is an annual Budget necessary?

It is not only necessary, but compulsory. Under Article 112 of the Constitution, a Statement of Receipts and Payments (estimated) has to be tabled in the Parliament for every financial year. The Receipts and Payments articulation contains united store, possibility support and people in general record.

The consolidated fund is a statement of all the inflows, such as tax revenues; and all expenditure, which constitute outflows. To withdraw from this fund the government requires parliamentary authorisation. The contingency fund is a corpus of about Rs. 50 crore kept aside for unforeseen expenses. The public account is one where all money raised from government schemes, such as Provident Fund, is accounted for.

What does the Budget document contain?

The budget speech and the document has two parts – Part A and B.

Part A is the macroeconomic part of the budget where various schemes are announced, and allocations are made to several sectors. The priorities of the government are also announced in this part.

Part B deals with the Finance Bill, which contains tax collection proposition, for example, salary charge corrections and indirect taxes.

What is the process of Budget approval? What will happen if a Budget is not presented before said date?

The Finance Minister presents the Budget in the Lok Sabha by by way of a speech and gives an outline of the Budget. He at that point tables it in Rajya Sabha.

Both Houses of the Parliament then allot time for a general discussion on the Budget, to which the Finance Minister replies at the end.

Lok Sabha then takes up a discussion on each ministry’s expenditure proposals. After this prescribed period, known as the Demand for Grants, the Speaker applies what is called the ‘guillotine’. Once the ‘guillotine’ is applied, all outstanding demands are put to vote. Though both the Houses of Parliament discuss the Budget, only the Lok Sabha votes on it.

The Appropriation Bill is then introduced after all demands are passed, and once this Bill is passed, the government receives authorisation to draw from the consolidated fund. Once the Appropriation Bill becomes an Act, the Finance Bill is passed. Once this is done, the final Budget gets approved.

In the event that the Budget isn't passed inside the reported date, Article 116 of the Constitution empowers the Lok Sabha to pass the Vote-On-Account, a record which covers just the use brought about.