Prime Minister’s Economic Advisory Council (PMEAC) Chairman C Rangarajan will head a high-level committee set up by the Planning Commission to suggest measures for effective management of public expenditure.
The committee will consist of 18 members and focus on the anomalies and inconsistencies that arise out of the present classification of expenditure into the Plan and the non-Plan expenditure categories. The 11th Plan (2007-12) document had discussed these issues in detail and referred to the major changes in the implementation machinery of the Plan in the past few years, laying stress on clearly defining the scope of the public-sector plan.
Other members of the committee will include the Planning Commission secretary, a Reserve Bank of India deputy governor and expenditure secretary, among others. National Institute of Public Finance and Policy Director M G Rao and Icrier Honorary Professor Nitin Desai will also be part of the committee.
The committee will aim at clearly defining the scope of the public-sector plan and the expenditure incurred therein, keeping in view the changes in the administrative machinery for implementation of the plan. It will also suggest an action plan for abolition of the classification of expenditure into Plan and Non-plan categories. This exercise will include detailing the changes in the mandate of various organisational units in the government that deal with allocation of public resources.
Moreover, it will also suggest a proper framework for taking a comprehensive view o f the total transfer of resources from the Centre to the States, including ensuring its accounting and reporting in a uniform manner. The committee will also examine the classification of expenditure into revenue and capital in the context of Constitutional Provisions and Fiscal Responsibility Act.