State prepares for Twelfth Five Year Plan

STATE MTFP 2011-12 TO 2013-14 TARGETS 15% TAX AND 20 % NON TAX REVENUE GROWTH
GANGTOK, 06 Feb: It will be interesting and noteworthy to see this year’s budget allocation to each of the departments and more so the annual budget of the state government as finalized by the Planning Commission of India. While the annual budget is supposed to be passed by the Legislative Assembly by March 2012 this year there may be some delay due to changes in estimates and proposals of the state government which had to be re-worked due to the earthquake of 18 September and subsequent damages incurred by the state.
With the state - as well as the country - now entering the next 5 year plan phase the state government is required to assess the availability of resource for financing the Twelfth Plan; in fact this has to be prepared and submitted to the central government before finalization of the Annual Plan. While the direction issued by the Finance Department last year to the government departments was to formulate their budget proposals as early as possible and the heads of departments requested to take immediate steps for formulation of  Budget for 2012-2013 and estimate the projection for remaining years of the 12th plan the process, it is likely, will be re-visited and the post earthquake scenario considered, assessed and accounted for as well.
It may be mentioned here that the state government has enacted the Fiscal Reform and Budget Management Act in 2010-11and introduced Medium Term Fiscal Plan (MTFP) containing the Fiscal projections for the period 2011-12 (BE) to 2013-14. While preparing the MTFP, 15% in Tax Revenue and 20% in Non Tax Revenue have been targeted. In view of this the state government has desired that the prescribed growth of tax and non tax revenue should not be less than the prescribed growth rate projected in the MTFP. In case of any variations to the estimated growth rate the departments will be required to submit their explanations.
This time the central government has desired some changes as well as some more regulation when it comes to preparing the state’s annual as well as 12th plan. All departments are required to submit a statement on the existing strength of Muster Roll and Work-Charged employees separately under non-plan. In case of Departments like Human Resource Development, Police, Health and Rural Management and Development, Nominal Rolls are to be segregated District wise, Subdivision
wise, Institution wise etc. No provisions are to be made for posts lying vacant for more than 1 year and further it is directed that provision for vacant posts should be made with circumspection in order to avoid savings due to non filling up of posts. A consolidated statement showing total strength is to be prepared for each department.
For the projection period i.e. from 2013-14 onwards growth rate of Non-Plan revenue expenditure is to be taken as 8% except for salaries, pension, interest payment. In case of any variation explanations are to be forwarded by the departments.
Consolidated estimates for revenue receipts were to be worked out on Trend Growth Rate as well as on policy decisions and other orders. In the event of any shortfall anticipated in revenue realization in revised estimates of 2011-2012 explanations were to be appended. The Finance Department had also desired that detailed explanations be furnished by departments which, during the financial year 2010-2011 had not been able to realize their estimated revenue; furthermore they are also required to propose the steps taken to overcome the shortfall of the previous year in order that the deficit is neutralized. In fact the departments had been directed to take urgent steps to increase their revenue commensurate with increase in expenditure.