The Finance Ministry has advised all the Central Ministries and Departments to ensure spending according to vote-on-account and send monthly reports.  The Vote on Account is for the period of April to August (5 months) of the current fiscal year.

After Parliament gave its nod to the Interim Budget and Vote-on-Account along with the Appropriation Bill, the Law Ministry notified an Act to provide for the withdrawal of money out of the Consolidated Fund of India for the services of a part of the financial year 2024-25. The Act approved a sum not exceeding ₹61.4-lakh crore under 102 Demands for Grants.

An office memorandum sent to all the Financial Advisors in the Central Ministries and Department from the Economic Affairs Department said: “During the Vote-on-Account period (April to August, 2024), Financial Advisors (FAs) are requested to ensure that expenditures remain within the limits authorised by the Parliament.”

This arrangement will continue until the passing of the Appropriation Bill for the entire fiscal year by Parliament.

“It is clarified that the limit of Vote-on-Account is on overall grant, not individual scheme,” the office memorandum said, adding that Financial Advisors will send a monthly expenditure report for the April-August period. Meanwhile, an official explained that since it is an election year, no cash management guidelines for the April–June quarter have been issued.

As per the spending guidelines, ministries and departments are required to make monthly or quarterly expenditure plans, and normally, they are permitted to spend up to 25 per cent of Budget estimates in each of the first three quarters (April-June, July-September, and October-December). For the fourth quarter (January-March), the cap is 33 per cent. These limits are keeping in mind cash flow and even spreading of expenditure in 12 months.

However, during the vote-on-account period, a limit is fixed for every ministry and department based on the annual limit divided by the number of months of vote-on-account. In other words, for FY25, the 5/12 formula will be applied to fix the limit.

It may be noted that during the election years, the budget is presented twice: the interim budget-cum-voteon account in February and the full budget post-formation of the new government, most probably in July. The full budget for the election year is preceded by the Economic Survey.