Expenditure Planning Current Affairs - 2019

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RBI Governor bats for Permanent Status to Finance Commission

Reserve Bank of India (RBI) governor Shaktikanta Das called for permanent status to Finance Commission.  RBI Governor Shaktikanta Das is also the member of the fifteenth finance commission.

Necessity of the Permanent Status

  • The permanent status will ensure consistencies between finance commissions so that there is some certainty in the flow of funds to states.
  • The permanent status will also provide for continuity between the successive finance commissions.
  • The permanent status will also provide for the finance commission to function as a leaner entity in the intervening period until the next finance commission is set up in a full-fledged manner.
  • The establishment of the finance commission through permanent status will also enable it to address issues arising from the implementation of the recommendations of the finance commission during the intervening period.

The RBI governor also called on for a robust expenditure planning without compromising on fiscal consolidation as fiscal federalism gathers momentum in the era of uniform goods and services tax (GST). He said that it is equally important to undertake robust expenditure planning based on a ‘commonly agreed expenditure code’ to address the socio-economic challenges without diluting the goals of fiscal consolidation.

Chhattisgarh Public Financial Management and Accountability Program

The Government of India, the State Government of Chhattisgarh and the World Bank signed a $25.2 Million Loan Agreement to support the State’s Reforms in Expenditure Management under Chhattisgarh Public Financial Management and Accountability Program.

Chhattisgarh Public Financial Management and Accountability Program

  • The reforms encompass Expenditure Planning, Investment Management, Budget Execution, Public Procurement and Accountability.
  • The programme will help the state of Chhattisgarh to strengthen its Direct Benefit Transfer (DBT) and Tax Administration Systems.
  • The programme will build the capacity of the State’s Human Resources and the Institutions Handling Management of Public Finances.
  • The World Bank will also facilitate cross-learning from Public Financial Management (PFM) Reforms undertaken by it in the other Indian States while bringing in global experiences.
  • Improvements in Public Financial Management is a key step for achieving the development potential of the state. Improvements will ensure that the State can invest more and with greater efficiency, for it’s poor and vulnerable.
  • The programme which focuses on IT solutions will benefit almost 11,000 Village Panchayats and 168 Urban Municipalities in the State.

About 92 per cent households in the State of Chhattisgarh belongs to Scheduled Castes, Scheduled Tribes and Other Backward Classes. The Direct Benefit Transfers (DBTs) is being increasingly used by the Central and State Governments to channel resources to households and individuals. The Programme will support the development of systems that will facilitate inter-departmental data interaction under secured protocols and automate most of the processing and payment of DBTs in the State. Thus enhancing the efficiency of the system.