In a significant decision to reform the Public Expenditure System, Minister of Finance, Dr Haseeb Drabu, today outlined a major restructuring initiative in the State Budget formulation.
Dr Drabu asked the Finance Department to reorganize and consolidate the ‘Demand for Grants’ into five major demands like Administrative Service, Social Service, Infrastructure Service, Economic Service and Financial Service.
In order to make the budget document accessible to legislators, he suggested that the Demand of Grants of various Departments must be clubbed together to make sure that all stakeholders know the expenditure policy of the State Government.
“This will add to transparency to the system as well as ensure a richer debate on public spending and priorities of the Government,” the Finance Minister said.
The move follows two major reforms carried out earlier by the Finance Department including abolition of Plan-Non Plan expenditure system and introduction of Revenue-Capital Budgeting.
To work out the details, Dr Drabu set up a High-Level Committee to be headed by the Principal Secretary Finance, Navin Kumar Choudhary and comprising of member of the J&K Legislature’s Estimates Committee, Law Secretary, Abdul Majid Bhat, Accountant General (A&E), Shourjo Chatterjee and Director Budget, Imtiyaz Ahmad.
“The Committee will examine legal and procedural inputs for Reorganization of Demands and submit its report within 10 days. Post GST, the State as well as the Centre’s budget has to undergo substantial changes. The reorganization will improve transparency of budget and enhance monitoring,” Dr Drabu said.
The Finance Minister was informed that there are 29 Demands for Grants presently and he proposed that, in accordance with rules and procedures, there may be only five to six Major Heads which will aggregate Demands for Grants.
“Such an arrangement will give us a bird’s eye view of the total allocations being made for a particular sector and the debate in the State Legislature will also be focused around these sectors. The idea is also to do away with publishing truckloads of Budget-related documents and instead make it easily accessible online,” he said.
“Because Demands for Grants are administratively decided, the Legislators don’t get a sense of grants in the House. In many cases, demands of MLAs are not even backed by the Expenditure Allocation,” he said.
The Finance Minister said the State Government wants a meaningful debate on the issue of grants. “Apart from being an administrative document, the Demands for Grants will be made meaningful for the legislature,” he said.