To get all approvals before April 1, PM Modi clears early Budget

Arun Jaitley had said that advancing the Budget would help improve public spending through a more balanced expenditure across the year and help implement tax proposals from the very start of the fiscal.

Prime Minister Narendra Modi.

Prime Minister Narendra Modi Wednesday gave his go-ahead to advancing the introduction of the general budget to the first week of February so as to dovetail Presidential approval a day before the new financial year starts on April 1.

At a meeting with ministers and officials of the Finance Ministry, the PM fixed the Parliament approval date for March 30 and asked them to work backwards to arrive at the presentation date which, officials said, would be in the first week of February with a slight compression of the recess.

“The Prime Minister approved March 30 as the date to avoid fiscal pendency in May and June,” a source said. It would also end the uncertainty on various tax proposals presented in the Finance Bill as taxpayers would know the exact provisions before the fiscal year starts.

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Finance Minister Arun Jaitley had recently said that advancing the Budget would help improve public spending through a more balanced expenditure across the year and help implement tax proposals from the very start of the fiscal.

Officials said that the tentative plan is that after the general discussion, the House would be adjourned for three weeks instead of the present practice of a month to allow the 24 departmental Standing Committees of Parliament to examine the Demand for Grants and submit their reports.

Once Parliament reconvenes in the first week of March, the Lok Sabha would be provided a fortnight for a detailed discussion and voting on Demand for Grants. This would be followed by a vote on the Bill to provide appropriation out of the Consolidated Fund of India.

“The aim is to provide sufficient time, at least a week, for its passage in the Rajya Sabha,” they said.

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While the Constitution does not mandate any specific date for the Budget, it is usually, with the approval of the President, presented on the last working day of February and the two-stage process of Parliamentary approval takes it to mid-May.

The advancement would also do away with the Vote on Account, said officials.

As the entire process of Budget generally goes beyond the current financial year, the Lok Sabha approves a grant in advance through the vote on account for two months for a sum equivalent to one sixth of the estimated expenditure for the entire year under various demands for grants.

On February 19 this year, The Indian Express had first reported that a Secretaries’ group had recommended to the Prime Minister that the annual Budget be moved ahead to ensure that the government’s ability to spend is timed with the start of the financial year in April.