Budget process set for a makeover

Scrapping Plan and non-Plan classifications necessitates the change

The preparation and presentation of the Union Budget are set for a complete overhaul from the next financial year (2017-18).

Almost all processes — pre-Budget meetings, statement of Budget estimates, Budget at a glance, expenditure statements volumes I and II, demand for grants, as well as the medium-term expenditure framework — are set for change.

The process could also move from inputbased budgeting to budgeting linked to outputs and outcomes, to be consolidated by the finance ministry’s Budget division, Business

Standard has learnt. These changes would primarily be necessitated by the abolition of the Plan and non-Plan classification of expenditure, and are likely to include three-year rolling targets for all central government departments and schemes. The spending will be classified into only revenue and capital expenditure.

The work on these changes is already said to have been started in various departments, including the finance ministry and NITI Aayog.

All major documents, including Budget at a glance, expenditure Budget volumes I and II, and demand for grants will reflect the change from Plan and non-Plan classification to a revenue spending and capital spending one.

The finance ministry is already said to have prepared a dummy expenditure volume II, and demand for grants, eliminating Plan and nonPlan distinctions. Dummy expenditure volume II and Budget at a glance are expected to be prepared soon. These dummy copies will serve as a reckoner during Budget preparations.

In the statement of Budget estimates, and the expenditure statements (which is part of Budget documents), the current classifications of central sector schemes, centrally sponsored schemes and central support for state Plan schemes will be abolished, to be replaced by establishment and obligatory expenditures, central sector schemes, and transfer to states.

These are also the three broad categories for which the various government departments might be instructed to present their requirements for budgetary allocations in the pre-Budget meetings.