Starting 2017-18, the Centre plans to move to a multi-year Budgeting framework that will allow government ministries to indicate ‘rolling’ targets for expenditure for at least the next three years. This is expected to help in better planning and implementation of schemes.
The concept of rolling plan was tried in 1978-80 by the then Janata Party government.
The current proposal is a part of the Centre’s decision to move to a new system of expenditure classification from the next fiscal, when the distinction of Plan and non-Plan spending will be scrapped and replaced with revenue and capital spending.
With just a few months left for the Budget-making process for 2017-18 to start, the Finance Ministry and the NITI Aayog are said to be working full-time on the new accounting heads and revamped Budget documents.
“With the spending heads now being changed and a move towards a more outcome-oriented expenditure, the documents will also reflect these classifications,” said a senior government official, adding that the Finance Ministry and the NITI Aayog are working on these.
Ministries will be expected to furnish their spending requirements on both the capital and revenue accounts in the Medium Term Expenditure Framework (for three years), which at present only includes overall spending on major schemes or heads.
“This will enable ministries to anticipate their spending requirements for the future and also enable medium-term planning so that government schemes and programmes are more effective,” said a senior government official.
Additionally, to evaluate its spending better, the Centre is also looking at a proposal to move to “outcome”-based budgeting. To this end, the Finance Ministry is now likely to come out with a consolidated annual Outcome Budget that would link outputs with the budgetary outlays and be presented either on the Budget day or in the same session. At present, each Ministry prepares its own Outcome Budget but the timing often varies.
Allocation of funds Continuing with the existing timeline, pre-Budget meetings will be undertaken by the Finance Ministry between October and December. Ministries will be expected to submit their proposals for revenue and capital expenditure only.
“There is no Planning Commission and like in the last two years, only the Finance Ministry will work on Budget allocations. The task will be easier this year, as there will be no Plan allocation that will have to be worked out,” said an official.
The NITI Aayog is likely to be roped in to work on scheme-wise allocation for Ministries as well as help them set targets for deliverables and outcomes.