Appropriation Bill 2020-21
25th Mar, 2020
The Lok Sabha has passed the Appropriation Bill 2020-21, authorising the government to draw over Rs 110 lakh crore from the Consolidated Fund of India.
The Lok Sabha has passed the Appropriation Bill 2020-21, authorising the government to draw over Rs 110 lakh crore from the Consolidated Fund of India for its working as well as the implementation of its programs and schemes.
- Appropriation Bill gives power to the government to withdraw funds from the Consolidated Fund of India for meeting the expenditure during the financial year.
- Post the discussions on Budget proposals and the Voting on Demand for Grants, the government introduces the Appropriation Bill in the Lok Sabha.
- It is intended to give authority to the government to withdraw from the Consolidated Fund, the amounts so voted for meeting the expenditure during the financial year.
Consolidated Fund of India:
- The Consolidated Fund of India includes revenues, which are received by the government through taxes and expenses incurred in the form of borrowings and loans.
- It represents one of the three parts of the Annual Financial Statement with the other two:
- the Contingency Fund
- Public Account
- All government expenditures are met by consolidated funds except a few made by contingency fund or public fund.
- The Consolidated Fund of India was created under Article 266 of the Constitution. It is also considered as the most important part of the financial statement.
- Similar to the Centre, every state has its own Consolidated Fund as well.
What goes into Consolidated Fund of India?
- All the government revenue generated from taxes, asset sale, earnings from state-run companies, etc go into the Consolidated Fund of India.
- The fund gets money from:
- Revenue earned in direct taxes such as income tax, corporate tax, etc
- Revenue earned in indirect taxes such as GST
- Dividends and profits from PSUs (Public Sector Undertakings)
- Money earned through government’s general services
- Disinvestment receipts
- This completes two-thirds of the exercise for approval of the Budget for 2020-21.
- Lok Sabha and Rajya Sabha had debated on Finance Minister Nirmala Sitharaman's second Budget in the first half of the current session
- In the second part, the lower house of Parliament passed the Appropriation Bill.
- In the third stage, the Finance Bill, which details the tax proposals, will be discussed and approved.
- The house passed the Appropriation Bill, envisaging spending of Rs 110.4 lakh crore during the financial year 2020-21
- With Parliament having very limited time for scrutinising the expenditure demands of all the ministries, it takes up discussion on spending or demands for grants for a few ministries during a pre-decided period of time.
- Once this is over, a guillotine is applied.
- Once the speaker applies the guillotine, all the outstanding demands for grants, whether discussed or not, are put to vote at once and passed.
- After this, Appropriation Bill was taken into consideration and passed.