Enthused by the better-than-estimated fiscal deficit achievement during 2010-11, Finance Minister Pranab Mukherjee on Thursday said that the government would adhere to the path of fiscal prudence to ensure that the budgetary targets set for the current fiscal are also achieved.
Addressing members of the consultative committee attached to his Ministry here on Wednesday, Mr. Mukherjee said: “Efforts to get the economy on the path of fiscal prudence are on track ... The government is committed to achieve the fiscal targets.” For this purpose, he said it would extremely important to measure outcomes of public expenditure so as to ensure that the country's scarce resources are productively deployed.
In the budget for the current fiscal, the government has targeted for a fiscal deficit of 4.6 per cent of the GDP (gross domestic product) with a revenue deficit of around 3 per cent.
To ensure that the targets are met, the government has now started providing, along with the Budget and Revised Estimate of current year and Budget Estimates of the ensuing year, the details of actual expenditure incurred on each scheme. This, Mr. Mukherjee said, was to provide “for a better analysis of the budgetary provisions and the trend in expenditure”.
Mr. Mukherjee said the Centre's fiscal deficit for 2010-11, as per the provisional accounts, is now estimated at 4.7 per cent of the GDP as against 5.1 per cent reflected in the Revised Estimates (RE) at the time of budget presentation earlier this year.
Likewise, the revenue deficit also stands pegged lower at 3.1 per cent as against 3.4 per cent in the RE. This, he said, had been possible due to higher tax collections as compared to RE, higher receipts from non-tax sources and non-debt capital sources and savings under plan expenditure of government.
Mr. Mukherjee said that improvement in the quality of expenditure and accountability requires regular monitoring and evaluation of public spending, with specific emphasis on outcome targets and achievement.
The government, he said, had set up a committee under the chairmanship of Prime Minister's Economic Advisory Council chief C. Rangarajan to look into the classification of public expenditure into Plan and non-Plan, which over the years has increasingly become artificial and sometimes misleading.
