Rail Budget and General Budget Merger [ Current News (Concise) ]
The Union Cabinet has approved the proposals of Ministry of Finance to merge of railway budget and general budget. It will came in the effect from the Budget 2017-18.92-year-old tradition that was started in year 1924 will come to an end. Since then the tradition was followed as a convention rather than under Constitutional provisions.
Administrative and Financial Arrangements
- It will continue as a departmentally run profitable undertaking to maintain its distinct entity as at present.
- It will keep its functional autonomy and allocation of financial powers etc. based on the current guidelines.
- Its current financial arrangements will continue wherein it will meet the revenue spending from revenue receipts.
- The capital at charge valued at 2.27 lakh crore rupees which Railways pays on annual gain will be abolished.
- From 2017-18So Railways will not have an allowance liability.
- Along with this the Union Ministry of Railways will also get Gross Budgetary support.
- Now Railways will not have to pay annual dividend of around 9,700 crore rupees to the Central Government.
Benefits of merger
- This move will take the affairs of the Railways to centre stage.
- The merger will bring a holistic picture of the financial position of the Government.
- The procedural requirements will decrease and focus on the aspects of delivery and good governance will be increase.
- Financial gain to railways
- Published on: September 22, 2016