FM move to curtail expenditure

Making it clear that he would not entertain any supplementary demands, the Sinha said that quot;at most only adjustments will be allowed.quot; Sinha also stressed that the receipts of each department should to keep pace with budgeted estimates. He also directed the FAs not to allow expenditure to overshoot the budgeted figures of their ministries. He said that the expenditure during the fiscal should be properly spaced so as to avoid bunching at the end of the financial year.

Emphasising the need to control expenditure so as to avert any serious fiscal crisis, the minister said that the financial advisors in various ministries/departments should act as the eyes and ears of the finance ministry and, quot;control the situation proactively.quot; The minister also asked them to expedite the exercise on zero-based budgeting at their ministry level and send the report to finance ministry latest by August 31, 2000.

Talking about the seriousness of the fiscal situation, the minister said that it was necessary to meet the budget targets in all respects. He said that an expert team had been constituted which was looking into the fiscal responsibility of the government and a draft legislation was likely to be introduced in the next session of Parliament.

He added that the government had already demonstrated its political will be curtailing non-merit subsidies on fertiliser and food apart from taking the hard decision of closing down six PSUs. He said that a necessary atmosphere has been created for carrying forward reforms, particularly in the financial sector.

The finance minister told the FAs that before releasing any funds to the state government, the unspent balances lying with them should be taken into consideration. He also asked them to ensure that the expenditure of their respective ministries should not exceed the budget target under any circumstances and in case of emergency if the expenditure exceeded in one area, the same should be matched by savings from other area within the ministry.

The other issues which came up for discussion at the meeting were right-sizing of the government, measures to make autonomous organisations self-sustaining, follow-up action on the committee of secretaries CoS decision regarding closure/winding up of PSUs, payment of dividend by PSUs, cash flow management and monitoring of expenditure.

The meeting among others was attended by minister of state for expenditure Bala Saheb Vikhe Patil, expenditure secretary C M Vasudev, 28 financial advisors and representatives from telecom department and railways.