CONTROL OVER EXPENDITURE
The expenditure on railways may be either revenue or capital, chargeable to works
demand. The control over expenditure exercised against these heads involves two
aspects.
a) Control with reference to sanctions.
i) Delegation of powers i.e. Railway board to General Managers and to lower
sanctioning authorities.
ii) In exercise of their financial powers, the sanctioning authority must pay due
regard to the “Cannons/Standards of Financial Propriety”.
b) Control over actual expenditure incurred/booked in the books of railways.
i) Control over expenditures against the budgetary allotments.
ii) Control over expenditures against the estimated cost as shown in works,
machinery and rolling stock program.
In order to ensure that the budget grants as voted by the Parliament and appropriations
as sanctioned by the President are utilized for the purpose they are voted/sanctioned,
the control is exercised. The requirements of railways are more as compared to the
resources available, hence it is important to exercise control over expenditure. Further,
railway is also a commercial organization in addition to Government organization, hence
if railway is to earn profit, it is necessary to ensure that control over expenditure is
exercised. The control over expenditure is exercised by
1) THE PARLIAMENT.
As the sanctioning authority for incurrance of expenditure, the parliament exercises
control over expenditure by reviewing the Appropriation accounts and the audit report
thereon critically. The scrutiny is done by the Public Account Committee on behalf of the
Parliament with a view to satisfy that the amount shown in accounts as having been
spent was legally available and was spent for the purpose for which the amount was
made available.
The control over expenditure is exercised by the Parliament through –
i) Railway convention committee.
ii) Estimates committee.
iii) Discussion on Railway budget.
iv) National Railway user’s consultative committee.
v) Committee on subordinate Legislation.
vi) Committee on Government assurances.
vii) Public Accounts Committee.
2) THE EXECUTIVES.
Incurrance of expenditure is subject to preparation or prior vetting of the estimates by
the Accounts department, sanction of the competent authority being obtained. This is
ensured by the executives. He further ensures that the work progresses as per the
sanctioned estimate and budget provision. The provisions of Cannons/Standards of
Financial Propriety are also to be kept in view, while granting sanctions to the
expenditure.
Cannons/Standards of Financial Propriety –
In exercise of their financial powers, the sanctioning authority must pay due attention to
the following principles –
i) The expenditure should not prima facie be more than the occasion demands and
that every Government should exercise the same vigilance in respect of
expenditures incurred from public money as a person of ordinary prudence,
would exercise in respect of expenditure of his own money.
ii) No authority should exercise its powers of sanctioning expenditure to pass an
order, which will be directly or indirectly to its own advantage.
iii) Public money should not be utilized for the benefit of a particular person or
section of a community unless –
a) The amount of expenditure involved is insignificant.
b) A claim for the amount could be enforced in a court of law.
c) The expenditure is in pursuance of recognized policy or custom.
iv) The amount of allowances such as travelling allowance granted to meet
expenditure of a particular type should be so regulated that the allowance are not
on a whole a source of profit to the recipient.
3) THE ACCOUNTS DEPARTMENT.
The internal check carried out by the Accounts office on bills, vouchers, estimates and
proposals is primarily to ensure that the same are as per codal provisions, however, the
end goal is to ensure control over expenditure.
On passing of the bills and adjustment of vouchers, the same are entered in subsidiary
registers like Revenue allocation register for revenue expenditure and Works register for
works expenditure. At the end of the month these registers are closed and Control
statements are prepared and submitted to the executives to enable them to know the
pace of expenditure. Control over expenditure is exercised by comparison of these
statements with budget proportions for the month and to end of the month. Similarly, the
totals of works registers are compared with budget grant/proportion and estimates to
exercise control over expenditure against budget grant and sanctioned estimates.
4) THE AUDIT DEPARTMENT.
The audit department as representative of The Comptroller and Auditor General Of
India, scrutinize the Appropriation Accounts with a view to see that the accounts are
properly maintained and the figures exhibited in the appropriation accounts are correct
as per the books. They also ensure that the expenditure is regular and properly
maintained. The scrutinized Appropriation Accounts along-with remarks offered by the
audit are submitted to the Railway Board. Railway Board submits the consolidated
Appropriation Account to the Parliament.
