The Union Cabinet has approved the merging of Indian railway budget with the general from next year, in a decision that ends a practice that began in 1924. Finance Minister Arun Jaitley said, "Rail budget and general budget will be amalgamated from now, there will only be one budget. However, the functional autonomy of railways will be maintained."
The decision holds considerable significance as in the recent past, political hotshots have used the rail budget to hand out goodies for their own purposes. Railway Minister Suresh Prabhu's inclination to give up the limelight is refreshing, and a break from the way the portfolio has been held in the past. The move came two months after a two-member committee comprising of Niti Aayog member Bibek Debroy and Kishore Desai recommended scrapping of the British-era practice.
The Cabinet has also decided to advance the presentation of general budget by a month instead of present practice of unveiling it at the end of February. To facilitate this, the budget session of Parliament will be called sometime before January 25, a month ahead of the current practice.
Accordingly, the beginning of budget preparation will be advanced to early October and GDP estimates made available on January 7 instead of February 7 now. Till now budget was presented on the last day of February and it is not until mid-May that the Parliament approves it in two parts. And with the monsoon arriving in June, most of the schemes and spendings by states do not take off until October, leaving just half a year for their implementation.
Early presentation of budget would mean that the entire exercise is over by March 31, and expenditure as well as tax proposals come into effect right from the beginning of new fiscal, thereby ensuring better implementation.
