With spend framework rejigged, govt schemes may get a new plan

Gearing up to bury one of the last vestiges of the erstwhile Planning Commission — Plan and Non-Plan expenditure — the Centre is taking a closer look at various Central and State schemes to improve their outcomes and create additional space for spending.

It is also rationalising the number of sub-components within each scheme to improve their delivery and efficacy.

“Government spending has to be more efficient. While this fiscal there is still some cushion from low oil prices, next fiscal onwards, there has to be space within government expenditure to reduce the imbalance on the revenue account as well as take forward developmental works,” said a senior official familiar with the development.

In Union Budget 2016-17 Centrally Sponsored Schemes (CSS) were reclassified as “core of the core”, “core” and “optimal”.

The Finance Ministry is hoping to bring similar schemes under the ambit of a single nodal Ministry during this fiscal year.

“A major exercise of rationalisation of Plan and Non-Plan schemes has been carried out during the year. This has been reflected in the Expenditure Budget... The schemes and projects with similar outputs and outcomes have been put together under an umbrella scheme for holistic planning and improved monitoring,” said the Union Budget document.

Officials said the impact of the exercise will be evident in the government’s financial planning from 2017-18.

As in the past, the NITI Aayog is also likely to be consulted before finalising a plan of action.

Expenditure Secretary Ratan Watal had said earlier this month that the government is working on a fresh classification of expenditure that would clearly distinguish between revenue and capital spending and be more outcome oriented. The new framework would be introduced from the next fiscal year and replace the Plan and Non-Plan classification.

Experts welcomed the move and said it would improve the implementation of schemes. “It is a long due step and will bring in savings for the government,” said DK Srivastava, Chief Policy Advisor, EY India.