INTRODUCTION
Budget is a crucial component of public administration as it helps in the allocation of resources to various sectors and departments of the government. In India, the budget is prepared and presented by the Ministry of Finance and is approved by the Parliament.
The Indian budget can be broadly categorized into two types- Revenue Budget and Capital Budget. The Revenue Budget deals with the revenue receipts and expenditure of the government, while the Capital Budget deals with the capital receipts and expenditure.
The Revenue Budget includes items such as taxes, duties, and other revenue-generating measures, along with the expenditure on salaries, subsidies, pensions, and grants to various states and union territories. On the other hand, the Capital Budget deals with capital receipts such as loans, borrowings, and disinvestment, along with the expenditure on capital assets such as infrastructure development, acquisition of assets, and investments in public sector enterprises.
The Indian budget also includes provisions for various schemes and programs initiated by the government to address various socio-economic issues such as poverty, education, healthcare, and infrastructure development. The budget is a reflection of the government's policies and priorities, and it plays a crucial role in shaping the country's economic growth and development.
TYPES
- ANNUAL BUDGET : As the name suggests, an annual budget is a budget that is presented every year by the government. It covers the revenue and expenditure projections for the upcoming financial year, which starts from 1st April and ends on 31st March of the next year. The annual budget is presented by the Finance Minister in the Lok Sabha, and it is subject to parliamentary approval.
- INTERIM BUDGET : An interim budget is presented by the government when a new government is about to come into power or during an election year. It is usually presented in February, a few months before the end of the financial year, to keep the government functioning until a full budget is presented by the new government. The interim budget only covers the expenditure projections for a few months until the new government takes office.
- VOTE ON ACCOUNT : A vote on account is a mechanism used by the government to obtain parliamentary approval for expenditure during the interim period between the presentation of the budget and its approval. It is a temporary grant of funds to the government to meet its expenses until the full budget is passed by the parliament. The vote on account is usually presented along with the interim budget.
- ZERO-BASED BUDGET : In a zero-based budgeting approach, every item of expenditure is evaluated on its own merit, without any regard for the previous year's budget allocation. This approach is based on the assumption that all budgetary items should be justified each year, and there should be no automatic assumption that they should continue to receive funding. The objective of a zero-based budget is to eliminate unnecessary expenditure and optimize resource utilization.
- GENDER BUDGET : A gender budget is a budget that incorporates a gender perspective in its preparation and presentation. It takes into account the differential impact of government policies and programs on men and women and allocates resources accordingly. The objective of a gender budget is to ensure gender equality and address gender-based disparities in the allocation of resources.
PRINCIPLES
- TRANSPARENCY : Transparency is a key principle of budgeting in Indian public administration. It implies that the budgeting process should be open, accessible, and easy to understand for the public. The budget should be presented in a clear and concise manner, with all the relevant information about revenue and expenditure projections, as well as the assumptions and methodologies used in the budget preparation. Transparency helps to build trust and credibility in the government, and it enables the public to hold the government accountable for its actions.
- ACCOUNTABILITY : Accountability is another important principle of budgeting in Indian public administration. It implies that the government should be answerable to the public for the way it manages public funds. The government should be transparent about its expenditure decisions and should provide regular reports on the implementation of the budget. Accountability helps to ensure that the government is using public funds in an efficient and effective manner and is delivering the expected outcomes and benefits to the public.
- FISCAL DISCIPLINE : Fiscal discipline is a principle of budgeting that emphasizes the importance of balancing the budget and maintaining financial stability. It implies that the government should not spend more than its revenue and should avoid excessive borrowing. Fiscal discipline helps to prevent inflation and other macroeconomic imbalances and enables the government to meet its financial obligations in a timely and efficient manner.
- INCLUSIVITY : Inclusivity is a principle of budgeting that emphasizes the importance of ensuring that all sections of society are included in the budgetary process. It implies that the budget should take into account the needs and priorities of different sections of society, including women, children, and marginalized communities. Inclusivity helps to ensure that the budget is equitable and fair, and it promotes social cohesion and harmony.
- EFFICIENCY : Efficiency is a principle of budgeting that emphasizes the importance of using public funds in the most effective and efficient manner possible. It implies that the government should prioritize spending on programs and projects that deliver the maximum benefits to the public at the lowest cost. Efficiency helps to optimize the use of public resources and enables the government to achieve its policy objectives in a timely and cost-effective manner.
CONCLUSION
In conclusion, budgeting plays a crucial role in the effective functioning of Indian public administration. The budgeting process involves the allocation of public resources to various sectors and programs, based on the government's policy objectives and priorities. The budgeting process is guided by various types of budgets, including annual budgets, interim budgets, vote on account, zero-based budgets, and gender budgets. Additionally, budgeting is guided by principles such as transparency, accountability, fiscal discipline, inclusivity, and efficiency, which ensure that public funds are used in an effective, efficient, and equitable manner. By adhering to these principles, Indian public administration can meet the needs of its citizens and ensure the sustainable development of the country.