Kick-starting the Budget-making process for 2017-18, the Finance Ministry on Friday issued the Budget circular highlighting the fresh changes in government accounts that would come into effect from next fiscal.
This includes the advancement of the Budget process and the merger in the distinction of Plan and Non-Plan expenditure.
“With the removal of this artificial distinction it is expected that the link between spending and outcomes will improve and become more holistic and focused,” it said, adding that there will be no Five-Year Plan, post the 12th Plan.
The Cabinet had earlier this week approved the proposal to advance the General Budget by a month in order to ensure that it is completed by March 31. It has also cleared the proposal to scrap the distinction between Plan and Non Plan expenditure and merge the Railway Budget with the General Budget.
Along with other nodal ministries, the circular has also been sent to the Financial Commissioner Railways to use the prescribed format for sending its estimates.
All spending classification will be in terms of revenue and capital account. in place of earlier Plan resource estimation, the Ministry of Finance will carry out resource estimation for funding of various Central schemes and programmes as well as central funding for States and UT schemes and programmes in line with the Vision document prepared by the NITI Aayog.
“The budgeting exercise will shift towards a medium term framework to give greater predictability to Ministries about resource availability,” the Ministry further said, adding that all Budgetary allocations would now be made in terms of the Medium Term Expenditure Framework.
Laying out the Budgetary time-line, the Finance Ministry said that nodal departments may submit the Revised Estimates of revenue and expenditure for the current fiscal and the Budget Estimates for 2017-18 by October 10.