Planning Commission in India MBA PPT

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MODULE - 8

LEARNING OBJECTIVES :

CURRENT ECONOMIC ISSUES PLANNING COMMISSIONFINANCE COMMISSIONPUBLIC ACCOUNTS COMMITTEECOMPTROLLER AND AUDITOR GENERAL,PUBLIC INVESTMENT BOARDCENTRE & STATE FINANCIAL RELATIONS


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India Planning commissionThe various functions of India Planning Commission are:

To assess the country's resourcesTo formulate 5 year plans that make an effective use of thecountry's resourcesTo determine national priorities and allot resources to the plansTo decide the machinery required to make the plans successfulTo make appraisals of the plans periodically in order to checktheir progress


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India Planning commissionThe composition of the India PlanningCommission has changed a lot since its inception.

At the head is the Prime Minister of the country whoacts as the ex-officio chairman.

The India Planning Commission has a deputy chairman who is nominated and the cabinetmembers who act as part- time members.


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INDIAN PLANNING COMMISSION

India Planning Commission has helped in the

better utilization of the country's resources for thecommon good of the citizens. The PlanningCommission is considered by many as the backboneof the country's progress and all-round development.


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PUBLIC ACCOUNTS COMMITTEEPAC- Oldest financial committee.

It consists of 22 members, 15 from Lokasabha & 7 fromRajyasabha.

As a matter of practice, since 1967, member of opposition

is being appointed as the chairman of the committee.


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PUBLIC ACCOUNTS COMMITTEEFunctions of the CommitteePAC - scrutinizes the Appropriation Accounts of theGovernment of India and the reports of theComptroller and Auditor General of India thereon. While doing so, it is the duty of the Committee tosatisfy itself:- That the moneys shown in the accounts as havingbeen disbursed were legally available for, andapplicable to, the service or purpose to which havebeen applied or charged;


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PUBLIC ACCOUNTS COMMITTEE Another important function of the Committee is thediscussion on points of financial discipline andprinciple. The detailed examination of questionsinvolving principles and system is a leading andrecognized function of the Committee.

While scrutinizing the Reports of the C&AG onRevenues Receipts, the Committee examines variousaspects of Governments tax administration .


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PUBLIC ACCOUNTS COMMITTEE

The Committee, thus, examines cases involving under-assessments, tax-evasion, non-levy of duties, mis-classifications etc., identifies the loopholes in thetaxation laws and procedures and makesrecommendations in order to check leakage of revenue.


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Public Investment BoardThe PIB considers investment proposals of the CentralGovernment Ministries in regard to their Public Sector

undertakings.

Central Sector Projects costing Rs. 100 Crores and above areconsidered by PIB.

Public finance influences the rates of consumption, savingsand investment in both physical and human capital.


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Public Investment Board As government should be in a position to allocate resourcesefficiently when markets fail to do so and, provide relief to

the poor, the public sector has expanded.

Public investment should therefore, promote development.

All developing countries are making major investments forsocio-economic development and are undertaking a largeno. of development programmes and projects


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Dis-investments programme in

IndiaThe dis-investments programme began in 1991.

The Government has adopted the route of disinvestment whichinvolves the sale of the public sector equity and the public atlarge.

The main approach of the Government in this regard is tobring down its equity in all non strategic public sectorundertakings and closed down those public sector whichcannot be revived.


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Dis-investments programme in

IndiaObjectives:

1. Rising of resources2. Reducing day tp day interference in the working of public

sector enterprises by loosening bureaucratic govt.control.3. Giving the management in the autonomy to act.


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FINANCIAL RELATIONS BETWEEN THE CENTRE AND THE STATE

The Centre State relations are crucial tothe preservation of the unity and integrityof India within the framework of itslinguistic and other diversities

The GOI Act of 1935 created the federal system &dealt with the problem of devolution of resourcesfrom the centre to the State.


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Allocation of resources between Centre & States:

1. Sharing of Income Tax 2. Sharing of Union excise duties 3. Sharing of estate duty4. Grants to States


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India- federal structure clear structure between the Union and Statefunctions and sources of revenue, but the residual powers belong to theCentre.

States have been assigned certain taxes which are levied and collected &also share revenue of certain other taxes.

State receive grants in aid of their revenue from the Union.

Union taxes- corporation tax,custom duties, excise duties,Terminal taxes

on goods carried by railways, sea, or air, taxes on sale or purchase of goods in the course of inter-state trade etc.,

State taxes Land revenue, taxes on the sale and purchase of goodsetc.,


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FINANCE COMMISSIONS

Under the provisions of Article 280 of the Constitution, the president isrequired to appoint a Finance Commission for the specific purpose of Devolution(delegation of power) of non-plan revenue resources.

Functions of Finance commission are to make recommendations to thePresident in respect of

1. The distribution of net proceeds of taxes to be shared betweenUnion and the States and the allocation of share of such proceedsamong the States.


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FUNCTIONS OF FINANCE COMMISSION

2. Principles which should govern the payment by the Union of grants-in-aid to the revenues of the States.

3. Any other matter concerning financial relations between Union andthe States.

So far 12 Finance commissions been appointed by the Governmentsince the inauguration of the Constitution in 1951.


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RECOMMENDATIONS OF FINANCE COMMISSIONS

Recommendations of Finance Commission can be

Grouped into three heads;

1. Division & Distribution of Income Tax and othertaxes

2. Grants-in-aid: for meeting the developmental needsof the states, to improve primary education facilities,improvement of communication and also upgrade of administration.

3. Loans by the Centre to States


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FINANCE COMMISSION & PLANNING COMMISSION

SL.NO FINANCE COMMSSION PLANNING COMMISSION

1 Statutory body appointed byPresidential proclamation once infive years

Non-statutory body permanentbody and the members are likefull Govt. employee

2 It helps to transfer non planresources from the Centre to theStates

Has the discretion to transferplan resources from the Centreto states

3 FC Recommendations are in theform of awards and the CentralGovt. is bound to accept them

PC transfer of funds is onlydiscretionary

4 FM get their authority from theconstitution and they are not theinstrument of the Central Govt.

PC is only an instrument of thecentral Govt.

5 Finance commissionrecommendations are assertive Planning Commission isdiscretionary.


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Comptroller & Auditor GeneralThere is a special arrangement for the audit of companies where the equity participation by Government is 51% or more.

The primary auditors of these companies are Chartered Accountants , appointed by the Union Government on theadvice of the Comptroller & Auditor General who gives theauditors directions on the manner in which the audit should beconducted by them.


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Comptroller & Auditor General Who is the comptroller and Auditor-General?

The office of comptroller and Auditor-General is astatutory office created by parliament In public audit Act 2001.

The Auditor-General is an officer of parliament. Inthe capacity, the Auditor-General is independent of

executive government and answerable to parliament.
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Comptroller & Auditor GeneralHe is holding the office of Auditor-General is recommendedfor the position by the house of representatives and isappointed by the governor-general.

The person appointed can hold the office for a once - only term of not more then seven years..

What does the Auditor-General do ? As Auditor-General.. The Auditor-General is the auditor appointed by

parliament to audit all types of public entity
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Comptroller & Auditor General

Audit Jurisdiction About 1200 public commercial enterprises controlled by theUnion and State governments, i.e. government companiesand corporations.

Around 400 non-commercial autonomous bodies andauthorities owned or controlled by the Union or the States.

Over 4400 authorities and bodies substantially financed fromUnion or State revenues


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Comptroller & Auditor GeneralThe Auditor General acts on behalf of Parliament by monitoring andcertifying whether the Govt. has the necessary authority from Parliamentfor its proposed daily Expenditure.

Audit & Assurance reports to audited entitiesThe audit of the yearly financial reports of every public entity results in two kinds of report.

One is the audit report that is attached to the published financial reportthe other is a report to the entitys management on matters arising from the audit.


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Comptroller & Auditor GeneralReports to parliamentReports are presented to Parliament arising from

performance audits and inquiries, and on mattersemerging from annual audits.

The Auditor General also reports to Parliament on

proposed activities in an annual plan, & onperformance against the Plan in an Annual Report .


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Planning Commission in India MBA PPT

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