Railway budget scrapped, merged with general budget
HIGHLIGHTS
- There will be no rail budget from the next year.
- The Union Cabinet gave its nod to merge rail budget with general budget.
- The practice of rail budget was started in 1924.
NEW DELHI: There will be no separaterailway budget from the next financial year.
The Union Cabinet on Wednesday gave its nod to merge the railway budget with the general budget from next year, putting an end to a practice that started in 1924.
"Rail budget and general budget will be amalgamated from now, there will only be one budget," finance minister Arun Jaitley said after the Cabinet meeting.
The Union Cabinet on Wednesday gave its nod to merge the railway budget with the general budget from next year, putting an end to a practice that started in 1924.
"Rail budget and general budget will be amalgamated from now, there will only be one budget," finance minister Arun Jaitley said after the Cabinet meeting.
"However, the functional autonomy of railways will be maintained," Jaitley said.
The decision to merge the railway budget with the general budget is significant as in recent years, particularly since coalition governments post-1996, political heavyweights have used the railway budget to hand out goodies and for their own image building.
The decision to merge the railway budget with the general budget is significant as in recent years, particularly since coalition governments post-1996, political heavyweights have used the railway budget to hand out goodies and for their own image building.
With the railway portfolio often held by regional biggies, the budget reflected political priorities of the incumbent. The railway bureaucracy has also dug in its heels in the past.
Railway minister Suresh Prabhu's readiness to give up the limelight is a break from the past as BJP seems in a position to dump the railway budget as its solid majority in Lok Sabha enabled it to retain the portfolio rather than handing it to an ally.
The move to discard the British-era practice of a separate rail budget by the Modi government comes after a two-member committee comprising Niti Aayog member Bibek Debroy and Kishore Desai recommended the exercise be scrapped.
With a view to get all the legislative approvals for the annual spending and tax proposals before the beginning of the new financial year on April 1, the Cabinet headed by Prime Minister Narendra Modi approved advancing date for presentation of the general budget by a month instead of present practice of unveiling it at the end of February.
To facilitate this, the budget session of Parliament will be called sometime before January 25, a month ahead of the current practice.
Accordingly, the beginning of budget preparation will be advanced to early October and GDP estimates made available on January 7 instead of February 7 now.
Till now budget was presented on the last day of February and it is not until mid-May that the Parliament approves it in two parts.
And with the monsoon arriving in June, most of the schemes and spendings by states do not take off until October, leaving just half a year for their implementation.
Early presentation of budget would mean that the entire exercise is over by March 31, and expenditure as well as tax proposals come into effect right from the beginning of new fiscal, thereby ensuring better implementation.
Early presentation of budget would mean that the entire exercise is over by March 31, and expenditure as well as tax proposals come into effect right from the beginning of new fiscal, thereby ensuring better implementation.
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