GS Mains Model Question & Answer : Examine the process of legislation of budget. Comment

 GS Mains Model Question & Answer : Examine the process of legislation of budget. Comment

Q. Examine the process of legislation of budget. Comment

Model Answer:

Examine the process of legislation of budget.

Once the budget is prepared, it has to pass through the following stages in the Parliament a) presentation of the budget by the finance minister in both the houses of Parliament, (b) general discussion on revenue and expenditure proposals, (c) presentation of demands for grants, and (d) voting and passing of the Appropriation and Finance Bills.

Presentation of Budget: The budget is presented to Lok Sabha .

While presenting the budget, the Finance Minister delivers the budget speech and lays on the table, the annual financial statement duly authenticated by him. There is no discussion on the budget at that time. Simultaneously, with the presentation of the budget in the Lok Sabha, a copy thereof is laid on the table of the Rajya Sabha.

Immediately after the presentation of the General Budget, the Finance Minister introduces in the Lok Sabha, the Finance Bill to give effect to the tax proposals of the Government of India for the following financial year. The bill contains proposals of the government for levy of new taxes, modifications of the existing tax structure or continuance of the existing tax structure beyond the period approved by Parliament.
No discussion on the budget takes place on the day it is presented to the house.

Budgets are discussed in two stages- the general discussion followed by detailed discussion and voting on the demand for grants.

After the presentation of the budget by the Finance Minister, the Speaker may allot time for general discussion on the budget. During the general discussion, the house is at liberty to discuss the budget as a whole or any question or principle involved therein, but no motion can be moved.

After the general discussion of the budget is over, the House is adjourned for a fixed period. During this period, the demands for grants of the ministries/departments are considered by the departmentally related standing committees. These committees are required to present their reports to the House within a specified period and make special report on the demands for grants of each ministry.

The demands for grants are not formally presented or laid on the table of the Lok Sabha. These form part of the budget papers and are distributed to members along with the budget documents. A separate demand is ordinarily made in respect of the grant proposed for<each ministry/department. The Finance Minister may however include in one demand, grant proposed for two or more ministries or departments or make a demand in respect of expenditure, which cannot readily be classified under a particular ministry. One ministry department may present more than one demand.

Discussion on Demands for Grants: After the presentation of the budget, the Minister of Parliamentary Affairs holds a meeting of the leaders of parties/ groups in Lok Sabha for the selection of ministries/ departments, whose demands for grants might be discussed in the House. On the basis of decisions arrived at this meeting, the government forwards the proposals for the consideration of the Business Advisory Committee. The Business Advisory Committee after considering the proposals allots time and also recommends the order in which the demands might be discussed. After the allotment of time by the Business Advisory Committee, a time-table showing the dates on and the order in which the demands for grants of various ministries would be taken up in the House is published for the information of the members.

After the reports of the Standing Committees are presented to the House, the House proceeds to the discussion and voting on demands for grants, ministry-wise. The scope of the discussion at this stage is confined to a matter under the administrative control of the ministry and to each head of demand as is put to the vote of the House.

It is open to members to disapprove a policy pursued by a particular ministry or to suggest measures for economy in the administration of that ministry or to focus attention of the ministry to specific local grievances. At this stage, cut motions can be moved to reduce any demand for grant but no amendments to a motion seeking to reduce any demand is permissible. The motions to reduce the amounts of demands for grants are called cut motions. The object of a cut motion is to draw the attention of the house to the matter specified therein. The cut motions are normally tabled by the members of the opposition
Guillotine: On the last of the allotted days for the discussion and voting on demands for grants, at the appointed time the Speaker puts every question necessary to dispose of all the outstanding matters in connection with the demands for grants. This is known as guillotine The guillotine concludes the discussion on demands for grants

Vote on Account: The whole process of budget beginning with the presentation and ending with discussion and voting of demands for grants and passing of appropriation bill and finance bill generally goes beyond the current financial year. Hence, a provision has been made in the Constitution empowering the Lok Sabha to make any grant in advance through a vote on account to enable the government to carry on until the voting of demands for grants and the passing of the Appropriation Bill and Finance Bill.

Normally the vote on account is taken for two months for a sum equivalent to one- sixth of the estimated expenditure for the entire year under various demands for grants.
Vote on account is passed by Lok Sabha after the general discussion on the budget is over and before the discussion of demands for grants is taken up.

Supplementary and Excess Demands for Grants: If the amount authorised to be expended for a particular service for the current financial year is found to be insufficient for the purpose of that year, or when a need has arisen during the current financial year for supplementary or additional expenditure upon some new service not contemplated in the budget for that year, the President causes to be laid before both the Houses of Parliament, another statement showing the estimated amount of that expenditure.

If any money has been spent on any service in a financial year in excess of the amount granted for the service for that year, the President causes to be presented to Lok Sabha a demand for such excess. All cases involving such excesses are brought to the notice of Parliament by the Comptroller and Auditor General through his report on the appropriation accounts. The excesses are examined by the Public Accounts
Committee, which makes recommendations regarding their regularisation in its report to the House.

The supplementary demands for grants are presented and passed by the House before the end of the financial year, while the demands for excess grants are made after the expenditure has been incurred and after the financial year to which it relates, has expired.

Appropriation Bill: After the demands for grants have been passed by the House, a bill to provide for the appropriation out of the Consolidated Fund of India of all moneys required to meet the grants and the expenditure charged on the Consolidated Fund of India is introduced, considered and passed. The introduction of such a bill cannot be opposed.

The scope of discussion is limited to matters of public importance or administrative policy implied in the grants covered by the bill and which have not already been raised during the discussion on demands for grants.
No amendment can be proposed to an appropriation bill, which will have the effect of varying the amount or altering the destination of any grant so made or of varying the amount of any expenditure charged on the Consolidated Fund of India.

Finance Bill: The Finance Bill is introduced in the Lok Sabha immediately after the general budget is presented to the Lok Sabha by the finance minister.
The introduction of this bill also cannot be opposed. The scope of discussion on the this bill is vast and members can discuss any action of the Government of India. The whole administration comes under review
The Finance Bill seeks to give effect to the financial proposals of the government of India for the next financial year. It also includes a bill to give effect to supplementary financial proposals for any period.
It submits to the jurisdiction of the House all the Acts, with which it deals, i.e., the Income Tax Act, Central Excise and Salt Act etc. and the House can amend all or any such acts to the extent they are dealt with in the bill. The procedure in respect of Finance Bill is the same as in the case of other money bills.

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