Economy is a scary subject to many UPSC aspirants. The questions from UPSC IAS Prelims are based on the conceptual understanding of macroeconomics. Conceptual clarity is what matters the most in Economics. If the aspirant’s conceptual clarity of Economics is sound, then they will even be able to get all answers correct in UPSC IAS Prelims. We advise you sincerely to invest more time in understanding the economic concepts and analyzing how one concept is interrelated to another. Apart from basic standard books aspirants should go through the Economic Survey which is essential for the Indian Economy for IAS Exam both prelims and mains.
The financial administration of any country must have a judicious financial system supported by sound and effective accounting method. A meticulously designed and well-managed accounting system helps to guarantee appropriate control over funds. Accounts are an essential part of financial management. On the basis of accounts, the Government regulates the form its monetary and fiscal policies.
Types of Funds in India UPSC
Here we are giving the details of Types of funds, expenditure, and grants in India.
- Consolidated Fund of India is the most important of all government accounts.
- According to Article 266 (1) of the Indian constitution, all revenues and loans raised by the issue of treasury bills, internal as well as external loans and all credits received by the Union Government in repayment of loans shall form a consolidated fund authorized the ‘Consolidated Fund of India’ for the Union Government.
- All legitimately sanctioned payments on the behalf of GOI are made from this fund.
- No money can be spent from this fund except by way of grants that the Parliament makes.
- Public Account is constituted under Article 266 (2) of the Constitution of India
- The receipts under Public Account do not constitute ordinary receipts of Government.
- Parliamentary approval for expenses from the Public Account is in this way not required.
- Bank savings account of the ministries and departments for day to day transactions
- Government schemes Fund, National Investment fund, National Calamity and contingency fund, defense fund, Postal insurance, National small savings fund, provident fund form part of Public Accounts, etc.
Contingency Fund of India
- According to the Article 267(I) of the Indian constitution is in the nature of an imprest (money preserved for a specific purpose) which is placed at the President’s disposal to enable him/her to make advances to meet emergency unexpected expenditure, pending approval by the Parliament.
- It is functioned by Finance secretary
- However, authorization of parliament is needed to recharge this fund from the consolidated fund
- Each state in India have their own consolidated and contingency funds
- Expenditures which do not need the parliament’s approval to be spent from the consolidated fund of India are called charged expenditures.
- Emoluments, allowances and expenditure of the President and his office, Salary and allowances of chairman, Deputy chairman of Rajya Sabha Speaker, Supreme Court judges, CAG and Deputy Speaker of Lok Sabha
- Vote on Account is passed after general discussion on the Budget.
- In order to keep the functioning of Government, the House is asked to vote usually two months’ funds i.e. about 1/6th of the total estimated expenditure under various grants. This is called Vote on Account.
- Vote of Credit is provided for meeting an unanticipated demand on India’s resources when on account of the amount’s huge volume, the demand could not be stated with details normally provided for in the budget.
- Supplementary grants are granted when the sum approved by parliament via the appropriation act for a certain service for the current financial year is found to be inadequate.
- Additional Grant are granted when a need has emerged for the duration of present financial year for additional expenditure for certain new service, not considered in budget for that year
- Excess Grant is granted when cash spent on any provision in a financial year exceeds the amount granted for that service in the budget.
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