The Cabinet on Wednesday approved advancing the Union Budget by a month and also adopted merging the rail and annual budgets, reported PTI. The decision to move up the Union Budget was initiated since Central government departments are allotted money before the beginning of a new financial year, which begins on April 1. However, Finance Minister Arun Jaitley said that the actual date of presenting the Budget will be decided after taking into consideration Assembly election dates.
The merger of the rail and Union budgets spells good news for the railways as it will no longer have to pay the annual dividend (around Rs 10,000 crore) for gross budgetary support (around Rs 40,000 crore) from the government. The merger brought an end to the 92-year-old practice of having a separate railway budget. The rail ministry will continue to have full financial autonomy on matters like fare, tariff revisions and market borrowings, reported the Business Standard.
The Finance Ministry and other government departments will now begin working out modalities of the changes made.
Union Railways Minister Suresh Prabhu had mooted and initiated the process to scrap the separate budget. He had told the Business Standard, “Except India, no other country in the world has a railways Budget. We want to do away with this colonial tradition.” The railways, which at one time commanded close to three-fourths of the government’s budget, no longer dominates government spending.