Fiscal Discipline
Q. Which of the following is/are true?
1) Plan / Non-Plan classification to be done away with from 2016-17 i.e. the current year.
2) Every new scheme sanctioned will have a sunset date and outcome review.- Published on 21 Mar 16a. Only 1
b. Only 2
c. Both 1 and 2
d. Neither 1 nor 2
ANSWER: Only 2
- Successive committees have questioned the merit in having Plan and Non-Plan classification of Government expenditure.
- A broad understanding over the years has been that Plan expenditures are good and Non-Plan expenditures are bad.
- This results in skewed allocations in the Budget. There is need to give greater focus to Revenue and Capital classification of Government expenditure.
- Therefore, decided that the Plan-Non-Plan classification will be done away with from fiscal 2017-18.
- To improve the quality of Government expenditure, every new scheme being sanctioned by Government will have a sunset date and outcome review.