Government Unlikely To Change The Financial Year - Telangana
Telangana government unlikely to change to January-December financial year format now
HYDERABAD: The state government is unlikely to change the financial year from April-March to Jan-Dec, at least for this year. A state cannot change the budget year in isolation but has to follow the Union Budget system.
According to information reaching finance department officials, the Centre is unlikely to change the financial year this year. The reason is that the Centre has to amend the related Act. If the budget year has to begin in January, the budget should be introduced in Parliament in December. With the Presidential election and Rajya Sabha biennial elections not far away, the change in financial year may not be effected this year.
“We cannot change the financial year on our own as the state budget is mostly dependent on central budget,” sources said.State government officials said that changing the financial year would lead to better monitoring of working season.
The present financial year of April-March splits working season into two parts, each falling in two consecutive financial years. Thus, financial year starting with Jan could better monitor and release funds for works. The officials agreed with a paper submitted by Bibek Debroy (member, NITI Aayog) and Kishore Desai (OSD, NITI Aayog).
Amendment needed
The Constitution does not define the financial year. Article 112 says on Annual Financial Statement thus: “(1) The President shall, in respect of every financial year, cause to be laid before both the Houses of Parliament a statement of the estimated receipts and expenditure of the Government of India for that year.” But, Section 3 of General Clauses Act 1896 defines the budget year from April to March. Any change in financial year requires amendment to the General Clauses Act.
The present financial year (April to March) was adopted in 1867. Prior to that, the financial year in India used to be from May to April. Considering that budget is a critical tool for implementing socio-economic policies of the government, the current financial year imposes its own limitations on the economic and investment planning.
Other important considerations often cited are current financial year leads to sub-optimal utilisation of working season, typically believed to spread from October till June with the period July-September being the monsoon season; difference in agricultural crop period, statistics, data collection periods.
No comments:
Post a Comment