Set up group to check excess expenditure: Par Panel to Govt

Concerned over increasing instances of ministries like Finance, Defence and Railways exceeding budgeted expenditure, a Parliamentary panel today asked government to set up a high level expert group to review the problem and suggest remedial steps.
"Steps should be initiated to constitute a high-level inter-ministerial group under the chairmanship of the Cabinet Secretary to examine the recurring issue (of excess expenditure)," said a report of the Public Accounts Committee, chaired by K V Thomas. The report was tabled in the Lok Sabha.
It also suggested that the group should review the existing General Financial Rules so as to plug the lacunae, if any, in the rules to curb the tendencies of ministries to incur excess expenditure in future.

The instances of excess expenditure, the report said, in grants and appropriations in ministries of Finance, Defence, Railways and Department of Post "only highlight the growing malice of not learning lessons from the past mistakes".
Excess expenditure, it said, "has occurred even in cases where the expenditure could have been easily anticipated and incorporated in the Budget estimates/revised estimates".
The PAC said that it should be incumbent on the ministries and departments to ensure that "under no circumstances the excess over final grants should exceed more than 5 per cent of the total grant".

It said financial advisors in different ministries should ensure strict adherence to financial discipline and reduce excess expenditure to the barest minimum if not eliminate all together.

"The secretary of the ministry/department concerned should take the responsibility for ensuring financial discipline in that ministry/department with a view to obviating excess expenditure," it added.
The PAC wants the Defence Ministry to chalk out a definite policy in order to observe greater financial discipline and ensured that the expenditure did not exceed the prescribed limits.
As regards the Ministry of Railways, the PAC suggested it should evolve a mechanism to access and project realistic requirement of funds both at budgetary and supplementary stages so that timely action can be taken to avoid excess expenditure.