Lok Sabha Question No. 1077 (UNSTARRED), answered on 2016-07-22
Subject: Easing of Non Plan Expenditure
Ministry: FINANCE
Asked by: VINOD KUMAR BOIANAPALLI

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF EXPENDITURE

## LOK SABHA UNSTARRED QUESTION NO.1077 TO BE ANSWERED ON FRIDAY, JULY 22, 2016 [ASHADHA 31, 1938 (SAKA)]

## EASING OF NON PLAN EXPENDITURE

1077 . SHRI B. VINOD KUMAR

Will the Minister of FINANCE be pleased to state:

- (a) whether the Government has eased to sanction   non-plan   expenditure proposals of Rs.500 crore as against the earlier limit of Rs.150 crore by the Minister in charge of the Ministry or Department; and upto
- (b) if so, the details thereof and the reasons therefor?

## ANSWER

## THE MINSTER OF STATE IN MINISTRY OF FINANCE (SHRI ARJUN RAM MEGHWAL)

- (a) Yes.
- has vide office memorandum No 1(5)/2016-E.IIA) dated 27.5.2016 revised the financial limits for appraisal and approval of Non-Plan Schemes/Projects by competent authorities. A Department of the Central Government with the Integrated Finance  Scheme, may exercise power to sanction Non-Plan ' expenditure on schemes in the manner mentioned below subject to the condition that (i) No Non-Plan will be created and (iI)No autonomous institution will be set-up. The powers will continue to be governed by procedural and other instructions issued by Government from time to time, e.g: General Economy Instructions: post

| Financial limits of Non- Plan Scheme                | Appraisal Forum                                                                                                                                                                  | Competent Authority to approve the schemel project           |
|-----------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------|
| (a) Upto Rs. 75 crore                               | Ministry/Department concerned in the normal course                                                                                                                               | Secretary of Administrative Ministry/Department              |
| (b) Beyond Rs. 75 crore but less than Rs. 300 crore | Standing Finance Committee of the Ministry/Department concerned under the chairmanship of Secretary with Financial Advisor and JSIDirector of the concerned Division as members, | Minister-in-charge of the Administrative Ministry/Department |

| (c) Rs 300 crore and above but less than Rs. 500 crore            | CNE   | Minister-in-charge Ministry/Department                     | of     |
|-------------------------------------------------------------------|-------|------------------------------------------------------------|--------|
| (d crore and above but less than Rs. 1000 crore                   | CNE   | Minister-in-charge Ministry/Department Minister of Finance | of and |
| (e) Rs 1000 crore and above                                       | CNE   | CabinetICCEA                                               |        |
| Proposals for new autonomous organisations irrespective of outlay | CNE   | CabinetICCEA                                               |        |

The revised delegation of powers for appraisal and approval of Revised Cost Estimates (RCE) is as follows:

| S No                                                                                                                                                                                                    | Limit                                                                                                                                                                                                   | Appraisal and Approval Forum                                                                                                                                                                                    |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| A                                                                                                                                                                                                       | Increase in costs due to increase in statutory exchange rate variation; and price escalation envisaged within the original approved time cycle, irrespective of the cost of the schemel_project         | No appraisal: Approval by Secretary of the Admn_ Deptt: if absolute cost escalation is up to Rs 75 crore, and by the Admn. Minister-in-charge if absolute cost escalation is above this.                        |
| Statutory levies include State/Central taxes, including import and export duties as notified by Gol and by the project authorities, but exclude water, electricity charges and POL price increases paid | Statutory levies include State/Central taxes, including import and export duties as notified by Gol and by the project authorities, but exclude water, electricity charges and POL price increases paid | Statutory levies include State/Central taxes, including import and export duties as notified by Gol and by the project authorities, but exclude water, electricity charges and POL price increases paid         |
| B, Increase in cost estimates due to reasons such as time over-run; change in scope, under-estimation_etc, (excluding_cost escalation for_ reasons cited in A above):                                   | B, Increase in cost estimates due to reasons such as time over-run; change in scope, under-estimation_etc, (excluding_cost escalation for_ reasons cited in A above):                                   | B, Increase in cost estimates due to reasons such as time over-run; change in scope, under-estimation_etc, (excluding_cost escalation for_ reasons cited in A above):                                           |
| 1                                                                                                                                                                                                       | Increase in costs up to 20% of the firmed up ##* cost estimates                                                                                                                                         | Appraisal by the Financial Adviser. Approval by Secretary of the Admn: Dept, if absolute cost escalation is up to Rs: 75 crore, and by the Admn: Minister-in- charge if absolute cost escalation is above this. |
| 2                                                                                                                                                                                                       | Increase in costs beyond 20% of the firmed up cost estimates substantial alteration in the scope                                                                                                        | Fresh Appraisal and Approval by the Competent Authority as per  the extant delegation of powers.                                                                                                                |
| **# Firmed up cost estimates means a cost estimate Which has gone through the full appraisal and approval process as per the extant delegation of powers                                                | **# Firmed up cost estimates means a cost estimate Which has gone through the full appraisal and approval process as per the extant delegation of powers                                                | **# Firmed up cost estimates means a cost estimate Which has gone through the full appraisal and approval process as per the extant delegation of powers                                                        |

The decision was taken with a view to expedite the decision making process of the Government of India: The revision was also required to harmonize the delegations of non-plan financial powers with the delegated powers under plan schemes: