From presentation to implementation: Understanding key stages of Union Budget
What's the story
The Union Budget is the annual financial blueprint of the government, detailing how it plans to generate revenue and spend it over the year.
The important document is not finalized when presented but goes through a few stages before approval.
The process starts with the Budget Session of Parliament, usually divided into two parts: presentation and general discussion of the budget, and detailed examination and passage of budget-related bills.
Presentation
The Finance Minister's role in the budget process
The Finance Minister is the key player in this process as he/she presents the budget in the Lok Sabha.
The presentation, called the Budget Speech, is a high-profile affair where key proposals and allocations are announced.
The speech is divided into two parts: Part A deals with the broader economic outlook and policy priorities, while Part B deals with tax proposals including changes in direct and indirect taxes.
Documentation
Key documents that make up the Union Budget
The Union Budget consists of a few important documents that give an all-encompassing view of the government's financial plans.
These are the Annual Financial Statement (AFS), Demand for Grants, Finance Bill, Appropriation Bill, Expenditure Budget, and Receipts Budget.
Each document details estimated receipts and expenditure for the fiscal year, proposed changes to tax laws and other financial regulations, or seeks parliamentary approval for fund withdrawal from the Consolidated Fund of India.
Scrutiny
Parliamentary scrutiny of the Union Budget
After its presentation, the budget is subject to intense scrutiny.
This includes a general discussion where Members of Parliament debate the broad budget proposals, concentrating on key policies and allocations.
The budget is then sent to Standing Committees for a detailed examination of allocations for each ministry.
These committees make recommendations to ensure transparency and efficiency in spending, adding to the accountability of the budget process.
Approval
Final steps in the Union Budget approval process
The last steps in the budget approval process are legislative.
The government tables the Appropriation Bill in the Lok Sabha, authorizing it to withdraw money from the Consolidated Fund of India for expenditure.
It needs to be passed by both Houses and get Presidential assent to become law.
A Finance Bill is also tabled to give effect to proposed tax changes, including income tax, customs duties, GST laws.
It also needs parliamentary approval and Presidential assent to come into effect.
Execution
Implementation and flexibility of the Union Budget
Upon the approval of both the Appropriation Bill and Finance Bill, the budget proposals become law.
The government can then spend funds according to approved allocations, implement tax changes and other financial measures, and start executing schemes announced in the budget.
The entire process is time-bound to ensure financial continuity for the government.
However, the budget remains a flexible tool with revisions and supplementary budgets introduced during the year if needed.