CREDITS -
(1) Why they are excluded from the scope of Demands ?
(2) Why GROSS expenditure (instead of NET expenditure)
under various Demands for Grants presented to the
Parliament for Vote ?
(3) What is the underlying principle justifying the same?
v
Earlier,
the NET expenditure (i.e., deducting CREDITS from GROSS expenditure) under
various Demands for Grants is presented to Parliament for Vote.
v
Example:
Gross: Rs.100, Credits: Rs.20,
and Net: Rs.80. So Rs.80 only Voted by
Parliament as Grant.
v
Due to
above practice, the following consequences
will arise.
v
When full credits did not materialize, the expenditure used to exceed the Budget
Grant/limit. Taking the above example, if Credits realized were Rs. 10 only
(against budgeted Rs.20 ) resulting the NET expenditure Rs.90 (Rs.100 minus
Rs.10) exceeding the Grant by Rs.10.
|
|
Budget Grant
|
Actual
|
Variation
|
|
Gross
|
Rs.100
|
Rs.100
|
Nil
|
|
Credits
|
Rs.20
|
Rs.10
|
Rs.10 (Savings)
|
|
Net
|
Rs.80
|
Rs.90
|
Rs.10 (excess)
|
v
In above example, the Gross expenditure is not
exceeded. Because of less realization of
credits, the Grant is exceeded. The Spending authority have to be answerable
for excess Net Grant in spite of his adherence to the Gross expenditure.
v
When more Credits realized than budgeted, there is
scope/possibility for spending authorities to incur unsanctioned expenditure to
the extent of more credits. Taking the
above example, if Credits realized were Rs.30 (against Budgeted Rs.20), the
likely unsanctioned expenditure to the extent of Rs.10 (Gross Rs.110, Credits
Rs.30 and Net Rs.80). Budget Grant Rs.80 is not exceeded, but spending authorities have undue scope for spending
authorities to spend more to the extent of more credits, which is not prudent.
|
|
Budget Grant
|
Actual
|
Variation
|
|
Gross
|
Rs.100
|
Rs.110
|
Rs.10 (excess)
|
|
Credits
|
Rs.20
|
Rs.30
|
Rs.10
(excess)
|
|
Net
|
Rs.80
|
Rs.80
|
Nil
|
v
To avoid the above eventualities,
1.
Now, the Credits and Recoveries have been
excluded from the scope of Demands for Grants.
2.
Such Credits & Recoveries were shown as at
footnote in the Demands for Grants.
3.
GROSS Expenditure (instead of NET expenditure)
under various Demands is presented to Parliament for Vote.
v
List of Credits and Recoveries
A.
Hire and haulage charges of Rolling stock
from the Port trust railways/Non budget lines.
B.
Commission on Audit of Military notes and
Credit Notes.
C.
CRRM - Credit for Railway Released Materials.
D.
Service contributions from other Depts on
account of Deputation.
E.
sale proceeds in Canteens.
F.
State Govt. grants to Schools and Fees recd.
from students.
G.
Credits for freight charges on Railway
materials.
H.
Credits on account of Inspection charges for
Coal.
I.
Misc. receipts under Works Expenditure
(Demand No.16)
***