GOVERNMENT OF ORISSA
FINANCE DEPARTMENT
***
No._____________________/F, Dt._____________
Bt.-I-20/2006
From
To
Sri K.C Badu, IAS,
Special Secretary to Govt.
All Secretaries to Government (By name)
Sub: Proposal for 1st Supplementary Statement of Expenditure for the
Financial Year 2006-07.
Sir / Madam,
I am directed to say that the 1st Supplementary Statement of Expenditure
for the year 2006-07 is likely to be presented in the Orissa Legislative Assembly
sometime in the month of November, 2006. Accordingly proposals for inclusion
in the 1st Supplementary Statement of Expenditure are required to be submitted
to Finance Department strictly in accordance with the guidelines indicated below
to enable Finance Department to present the Demand for Supplementary Grants.
2.
As envisaged under Orissa Fiscal Responsibility and Budget Management
Act, 2005. no additional expenditure should be incurred without
corresponding resources being firmed up or without reducing equivalent
amount of expenditure somewhere else. As per the mandate of the 12th
Finance Commission the Revenue Deficit has to be reduced to zero by 2008-09.
Hence there is little scope for substantive provision in the Supplementary unless
the proposed expenditure is backed by equal amount of firmed up resources.
Keeping all these in view Finance Department will consider the Supplementary
Schedules particularly in the following cases.
3.
Recoupment of Advance from O.C.F
Substantial amount is outstanding for recoupment against sanction of
Advance from Orissa Contingency Fund. On account of non-recoupment of
earlier advance it has not been possible to meet the urgent requirement in
certain cases. Hence recoupment of O.C.F advance shall be given the first
priority. While submitting schedule for recoupment, the letter No. and the date
of sanction of the O.C.F. advance and detail Head of account should be clearly
indicated.
The recoupment of O.C.F advance has to be made within the ceiling
communicated by the Planning and Co-ordination Department in case of State
Plan and by Finance Department in case of Non-Plan. However, the
Administrative Department may approach P & C Department for consideration of
additional financial ceiling if necessary within the overall plan ceiling allocated to
the department. In case of O.C.F. advance under the Non-Plan, the concerned
2
Departments have to locate savings within the budgetary allocations available at
their disposal except in cases where the Finance Department have specifically
agreed to allow the additional ceiling for recoupment of the O.C.F Advance.
4.
Additional Provision for E.A.P., RIDF, KBK, AIBP etc.
Additional provision for E.A.P financed by External Agencies and projects
financed by NABARD / L.I.C / G.I.C , AIBP and other resource tied up schemes
shall be considered only where firmed commitment of release of fund has been
received and the existing provision is not commensurate with the resource
estimate approved by the Planning Commission for such schemes. However,
additional provision would be considered basing on the progress of expenditure
and the likely date of completion of those projects identified for completion for
zero based investment review. Full requirement for the projects under RIDF and
other resource tied up schemes would be provided depending on the
commitment of the Administrative Department to fully utilise the additional
provision.
Meanwhile, sanction of projects under RIDF-XII has been communicated
by NABARD and a lot more projects are expected to be sanctioned during the
current financial year. To ensure execution of such projects after following
necessary procedural formalities, provision has to be made in the
supplementary.
In case of ongoing and closed externally aided projects ACA has
been received from GoI on “no cash payment” basis in respect of
payment made by the donor for consultancy and equipment etc.
Equivalent expenditure under the functional major head of account
pertaining to such projects should be booked so that receipt of
ACA/project related expenditure can be brought to the accounts of the
State Government. Concerned departments should prepare the list of
such projects and furnish schedules for provision of funds which are to
be accommodated under the existing ceiling for EAPs.
5.
Additional Provision towards
Sponsored Plan Schemes
state
share
under
Centrally
Additional requirements under State Share for Centrally Sponsored Plan
Schemes should be fully provided subject to the stipulation that concerned
Administrative Department must satisfy that they have fully utilized the central
share along with the state share provided so far and substantial progress has
been made in submission of U.C. Failure to submit the arrear UC by 31.08.2006
would disqualify the department to claim additional provision towards state
share.
6.
Regularisation of
Authorisation
Advance Expenditure incurred by Way of
The proposals for regularization of advance works expenditure of
Engineering Departments authorized in absence of adequate budget provision
under para -3.7.1 (b) of the OPWD code, if any, should be processed indicating
M.09/Supplementary circular 2006-07(dt.19.08.2006)
3
savings / specific source of funding to regularize the advance of expenditure by
necessary Supplementary Provision.
7.
Diversion of Fund
Diversion of Fund to meet the additional requirement in needy sectors by
locating savings or for accounting adjustment without any additional cash outgo,
may be proposed (for example : revenue account to capital account or form
voted to charged etc.).
8.
Additional Provision under Central Plan Schemes and Centrally
sponsored Plan Schemes
Additional Provision under Central Plan Schemes and Centrally Sponsored
Plan Schemes will be considered only where Central Assistance has already been
received or where firm commitments from Central Governments are available
but provision has not been made in the Budget Estimate for 2006-07. Copies of
relevant letters should be placed in the file and proposals be processed through
Planning & Co-ordination Department While proposing additional allocations
under Central Plan & Centrally Sponsored Plan Schemes as indicated above, the
probable savings under other CP and CSP Schemes alongwith State matching
share where assistance from Centre are remote, should be explored for diversion
so as to avoid surrender of funds at the close of the Financial Year. Further,
while processing additional provision for continuing schemes under Central Plan
and Centrally Sponsored Plan Schemes the Administrative Departments are
required to indicate the total allocation of Central Share so far received,
expenditure incurred and utilization certificate furnished to Govt. of India. The
proposal for additional provision shall not be considered unless
Utilisation Certificates for the amount received upto 31.3.06 are
submitted by 31.08.2006.
9.
Provision for new schemes
In case of new schemes, either administratively approved by Govt. of
India or where firm commitment has been received from Govt. of India for
release of funds during 2005-06/2006-07, provision may be made provided prior
concurrence of Finance Department has already been taken. Similarly, additional
provision may be made in respect of new schemes announced by State
Government like Gopabandhu Gramin Yojana keeping in view the expenditure
that can be reasonably incurred during the remaining period of the financial year
after observing the prescribed procedure.
10.
Provision under Award of 12th Finance Commission
In case of award of 12th Finance Commission where provision has not
been made or less provision has been made in the Annual Budget estimate for
2006-07 either under Non-Plan or Plan, additional provision may be considered
depending on the progress made for utilization of the fund already received.
M.09/Supplementary circular 2006-07(dt.19.08.2006)
4
11.
Payment of Guaranteed Loans
Due to default in payment of guaranteed loans by some State Govt.
Undertakings / Corporations / Co-operatives, State Govt. have discharged the
liabilities through One-time Settlement. Such amounts have been paid directly
by Finance Department out of the Budget provisions made under Demand No.5.
As per accounting procedure, the repayments made are required to be treated
as loan to the loanee organizations concerned. In order to regularize the matter,
the Administrative Departments concerned need to submit necessary
supplementary proposals under State Plan. Since the amount would be provided
as loan to the organization concerned and contra-credited to the receipt head
against the amount already paid, there shall not be any net cash outgo and for
the above purpose, substantive provision shall be made in the
supplementary by P & C Department for accounting adjustment only.
12.
Provision for dues payable and receivable by State Govt.
It is seen that dues are payable by State Govt. to BDA/IDCO etc. and
payment of Govt. dues by these organisations. Necessary provision should be
made in the supplementary to ensure payment of such dues.
13.
Additional Provision for Pay
As per the decision of the State Govt. D.A. equal to 50% has been merged with
the Basic Pay of State Govt. employees w.e.f. 1.4.2006 vide F D circular
No.17491 dt.22.4.2006. Now, this 50% D.A. which has been merged with Basic
Pay is being distinctly shown as Dearness Pay. Hence there may be shortfall in
Pay head during the current financial year. Administrative Departments may
clearly workout the shortfall, if any, and assess the additional requirement. They
should clearly locate the savings in D.A. head.
In certain cases, in lieu of abolition of posts, if fresh creation of posts at
consolidated salary has been approved with the concurrence of Finance
Department, the consolidated salary requirement on such contract appointees
should be separately worked out indicating the details of contractual posts
sanctioned, the rate of consolidated salary and the requirement for the current
financial year i.e 2006-07. This should be shown separately as “consolidated pay
for contractual appointees”. (Code No.01004)
14.
Provision for LTC
Leave Travel Concession has been restored by the State Govt. w.e.f.
01.04.2006 in favour of Govt. employees who are in receipt of regular scale of
pay vide F.D.O.M. NO.17704/F., dt.24.04.2006. Hence all departments of Govt.
are required to assess the actual requirement under LTC for the current financial
year and make necessary provision in the supplementary.
15.
Arrear Pay and allowances
Arrear pay and allowances for those who have already retired but have
not been paid so far, should be met out of the Budget provision at the 1st
instance and any deficit to meet further requirement for the current financial
M.09/Supplementary circular 2006-07(dt.19.08.2006)
5
year may be clearly worked out. Finance Department may consider this
depending on the availability of the overall resources.
16.
Additional requirement of Grant-in-Aid salary
The additional requirement of GIA salary for the current year both under
Non-Plan and State Plan in respect of those who are already in receipt of the
Grant-in-aid may be worked out after taking into account the existing provision.
Similarly where all legal forum have been exhausted and the payment is to be
made as per the latest direction of the Hon’ble Courts some provision should be
made to meet the current dues with due regard to the court order. Since Cabinet
has approved the principle of payment of arrear grants-in-aid which is legally
payable within a period of ten years, specific provision is also to be made for
arrears during 2006-07.
17.
Provision for Electricity, Water Charges & Municipal Dues
The power distribution companies and Chief Engineer, PH (Urban) are
frequently indicating about non payment of energy charges and water charges
and about huge outstanding arrears. The Administrative Departments should
verify the actual position and assess the actual requirement for additional
provision. Wherever possible, equivalent savings should also be located to meet
the additional requirement. Additional provision for the purpose would be
considered by the Finance Department only after the claims are certified and
authenticated for payment by the Secretary of the Department to the effect that
the amount proposed is based on the final figure arrived at after the joint
verification made by the DDO concerned / Heads of Department and the
Executive Engineers of the Distribution companies and Executive Engineer, PH,
as the case may be. Similarly, additional provision for payment of municipal
taxes would be provided after due verification of the claims and payments made
earlier.
18.
Payment of Decretal Dues
It is observed that proposal for advance from OCF/authorisation of
expenditure/re-appropriation of funds are submitted for payment of decretal
dues. Hence provision should be made in the supplementary for payment of
decretal dues which have reached finality and are to be discharged in pursuance
of the court orders during the current financial year.
19.
Communication of the allotment and supplementary provision
In the past, it has been noticed that after taking supplementary provision,
funds have not been fully utilized or diverted for other purposes or have been
surrendered. This has been adversely commented upon by C & A G of India in
their reports. Hence Administrative Departments and Controlling Officers are
required to ensure that allotment of the existing provision is communicated in
time and supplementary provision is fully and properly utilized. The allotment
including supplementary provision, wherever allowed, shall have to be
communicated latest by 15.2.2007. The allotment issued after 15.2.2007
shall not be acted upon by the Treasury Officers and such bills shall be
returned with objections.
M.09/Supplementary circular 2006-07(dt.19.08.2006)
6
20.
Improper Assessment of the requirement and Accountability under
the FRBM Act.
It is invariably observed that due to improper of assessment of
requirement of funds at the supplementary stage huge amounts are either
surrendered / diverted / remain un-utilised / or excess expenditure is incurred.
These serious financial irregularities are adversely commented upon by
Accountant General in almost all their reports. It is therefore, urged upon that all
departments should make realistic assessment of requirement for the
supplementary which can be utilised effectively, efficiently and prudently. FRBM
Act also envisages that Budget provision should be made on realistic assessment
basis. Hence, it is made clear that any deviation in this regard would attract
personal liability under the provision of the FRBM Act.
21.
The Administrative Departments are requested to formulate the
supplementary proposals expeditiously in accordance with the guidelines
indicated above and submit their proposals to Finance Department as per the
time schedule given below.
a)
In case of Non-Plan, the draft schedules should reach Finance
Department latest by 15.9.2006 and the Non-Plan schedules duly
admitted by Finance Department shall be returned to the
Administrative Departments by 30.09.2006.
b)
The plan schedules should be processed and forwarded to Planning &
Co-ordination Department by 15.9.2006.
c)
The draft schedules under Plan Schemes after the concurrence of
Planning and Co-ordination Department should reach Finance
Department by 25.09.2006.
d)
The plan schedules with concurrence of Finance Department shall be
returned to Administrative Departments by 30.09.2006.
e)
Five cyclostyled copies of the Non-Plan and Plan Schedules duly
concurred in must reach Finance Department by 30.09.2006.
22.
Unless the schedules duly admitted by Planning and Co-ordination
Department and Finance Department are submitted to Finance Department by
the due dates as indicated above, it shall not be possible to include the proposals
of Administrative Departments in the 1st Supplementary Statement of
Expenditure.
23.
informed.
All Heads of Departments and Controlling Officers are being
24.
This information is available
Government WWW.Orissa.gov.in/Finance.
at the
internet site of Orissa
Yours faithfully,
Special Secretary to Govt.
M.09/Supplementary circular 2006-07(dt.19.08.2006)
7
Memo No. __________/F., Dt.____________
Copy forwarded to all Heads of Departments (Controlling Officers) / Financial
Advisors and Assistant Financial Advisors / Accounts Officers of Heads of Departments
for information and necessary action.
Special Officer-cum-Joint Secretary to Govt.
Memo No. __________/F., Dt.____________
Copy forwarded to all Officers / Section Officers of Finance Department for
information and necessary action.
Special Officer-cum-Joint Secretary to Govt.
Memo No. __________/F., Dt.____________
Copy forwarded to all Treasury Officers of District Treasuries and Special
Treasuries / Sub-Treasuries Officers / F.A. & C.A.O. of all the Irrigation Projects for
information and necessary action.
Special Officer-cum-Joint Secretary to Govt.
Memo No. __________/F., Dt.____________
Copy forwarded to Private Secretaries to Additional Chief Secretary (Finance) /
Special Secretaries / Additional Secretaries of Finance Department for information of
Additional Chief Secretary (Finance) / Special Secretaries / Additional Secretaries.
Special Officer-cum-Joint Secretary to Govt.
Memo No. __________/F., Dt.____________
Copy forwarded to Dr. R.V. Singh, Special Secretary to Govt., P & C Department
for information and necessary action.
Special Officer-cum-Joint Secretary to Govt.
M.09/Supplementary circular 2006-07(dt.19.08.2006)