Budget 2022: The process of drawing up the Union budget starts every year around August or September and is cumbersome and time-consuming; different parts of government work collectively to shape the document
File image of Finance Minister Nirmala Sitharaman arriving at Parliament to present the Union Budget 2020-21. AFP
Rome was not built in a day.
The same adage applies to the EU budget.
The Centre’s annual financial statement takes several months to prepare and different parts of government work collectively to shape the document.
Please read: Union Budget 2022-23: Understanding the government’s annual financial statements
For those wondering how this document was shaped from its inception to its presentation in Parliament, here is a step-by-step guide:
Dissemination of circulars and consultation meetings
Although it is known that the Minister of Finance presents the budget to Parliament, the work of creating the budget is undertaken by the Ministry of Finance.
A Budget Division of the Department of Economic Affairs under the Ministry of Finance initiates the process of formulating the Union budget for the following financial year during the months of August to September each year.
This starts with the budget division sending budget circulars containing summary forms and necessary guidelines to the relevant ministries and departments around the last week of August or the first half of September each year.
These circulars are further distributed to disbursement and field officers who are responsible for providing details of the financial expenditure and revenue of their respective departments during the current and past financial year, and their financial requirements for the next exercise.
In addition to providing their estimates, the departments also provide details of their revenues and expenditures for the past year.
The data provided by officials is then reviewed by senior officials in their departments. After approval (or revision, if necessary), the data and estimates are transmitted to the ministries concerned where they are again examined. Finally, after appropriate review, the data and estimates are sent to the Ministry of Finance.
This is followed by extensive consultations and meetings between ministries/departments with the Ministry of Finance and the government planning body – NITI Aayog.
At the same time, the Department of Economic Affairs and the Department of Revenue meet the various players. These include farmers, business people, foreign institutional investors (FIIs), economists and civil society groups. The aim is to take their advice to prepare the Union’s budget.
Please read: Budget 2022 must lead by example on women’s and children’s health, not just pay lip service
After these meetings and reviewing the data provided by the various ministries, the Ministry of Finance allocates the revenue to the various administrative ministries. The ministry is also developing new social protection programs.
Before this is locked in and finalized, all proposals are discussed with the Prime Minister. If approved, it is then frozen and ready for the next step.
The next step is the printing of the budget, which is marked by the usual “Halwa ceremony” at the North Block in Delhi.
Why is the halwa made and served to select officials? This practice is done as part of the Indian tradition of having something sweet before starting an important job.
As part of the ritual, the Minister of Finance and some officials prepare the ‘halwa’ which is prepared in a large ‘kadhai’ (large cooking pot) and served to all staff of the Ministry of Finance.
Interestingly, people who participate in the halwa ceremony are then placed in “lockdown” in the northern block for 10 days.
These senior officials such as Joint Secretaries and Secretaries, Budget Officers are not even allowed to contact their family or friends as budget documents are closely guarded. It is only after the Minister of Finance presents the budget to Parliament that civil servants are allowed to contact their family members. This is done to ensure complete privacy and prevent any leaks.
The documents are printed on a press located in the basement of the North Block. Previously, printing did not take place in the Rashtrapati Bhawan, but due to a leak in 1950, the printing of budget documents was moved to Minto Road.
It should be noted that in 2021 there was no printing of the budget in accordance with COVID-19 protocols. Instead, the budget was distributed electronically to MPs.
For the very first time, the budget will be dematerialized this year. Due to the COVID-19 pandemic, the ministry has decided not to print copies of the 2021 budget. The budget will be typed and available to everyone electronically, online: Sources
— ANI (@ANI) January 11, 2021
Presentation of the budget
The last step in all of this is the presentation of the budget. The Finance Minister informs the Union Cabinet through a “Cabinet Summary” just before presenting it to the Lok Sabha.
The Minister of Finance presents the budget to Lok Sabha. Until 2016, it was presented on the last day of February. But that changed in 2017 and the budget is now presented on February 1 every year.
The Union budget is then tabled in Parliament after the conclusion of the Finance Minister’s speech.
With contributions from agencies
Read all Recent news, New trends, Cricket News, bollywood news,
India News and Entertainment News here. Follow us on Facebook, Twitter and Instagram.