Budget-making typically begins in August-September, which is six months prior to its presentation. This process takes up to six months.
Minister of Finance Nirmala Sitharaman is scheduled to present the final full budget for this government on February 1, 2023. This is her fifth Union Budget. The Union Budget is the annual academic document of a government, outlining the fiscal journey for the upcoming fiscal year.
It is meticulously drafted following a strict procedure of consultation with relevant stakeholders.
She will present her fifth consecutive Union Budget. It is the Union Budget is the annual financial statement of a state that provides the fiscal roadmap that the country will follow for the coming year. It is prepared following a clearly defined procedure that includes consulting, planning and implementation.
The Budget is created by the finance ministry in collaboration in consultation with NITI Aayog and other relevant departments. The Budget is required to be presented and passed by both chambers of parliament prior to the start of fiscal year (April 1 through March 31,). It takes months to complete these tasks. The Budget-making process typically begins between August and September, six months before the date for its presentation. This is how the Union Budget is prepared
Scrutiny Of Proposals Received And Preparing Estimates Of Revenue And Expenditure
From mid-October through mid-November officials from the Expenditure and Financial Affairs Departments meet with officials from all central governments and agencies, ministries and UTs in order to determine revised Estimates (RE) of the remaining year , as well as Budget Estimates for the coming year.
When the plans are accepted from the Revenue Secretary they are then reviewed by highest official of government. The revenue department that collects revenue via corporate tax, income tax as well as goods and services tax, customs charges and various cesses, starts to estimate the expected adjusted tax revenue for the fiscal year in which they are currently running as well as the expected revenue for the upcoming fiscal year.
Estimates of tax-free revenues such as the proceeds of diversifications, spectrum sale and dividends received from companies like the Reserve Bank of India, state-owned financial institutions and state-owned companies are also compiled by the departments responsible to be used in subsequent years. After the information is approved, it is submitted for approval by the Finance Ministry.
The next step , the consolidation process and examination of Budget estimates is done by the department of budget at the Finance Ministry from a financial point of view. The division ensures that there is no duplicate spending and estimates are made with in mind the economics. The new expenditure is scrutinized thoroughly to determine its value as per the national plan. It seeks advice from Aayog NITI Aayog in this regard.
It is the Departments and Ministries submit new plans to the Finance Ministry through Budget estimates and treat its decisions to be final. If there is disagreement, it’s sent to the union cabinet where the decision is considered to be final.
The finance minister will begin her own series of budget consultations with a range of parties and groups of interest starting in the middle of November, which includes organizations representing industry including representatives from sectors such as agriculture, Social and Welfare sectors labor organizations economists, economists and other.
In the case of Budget 2023, the consultations for the Budget began on the 21st of November. The finance minister ended her consultations on the Budget on the 28th of November. A statement issued by the Finance Ministry said that “More than 110 invitees representing seven stakeholder groups participated in eight meetings.”
Final Draft Preparation
In December, the finance ministry has been declared “quarantined” and is closed for all visitors. Intelligence Bureau employees and paramilitary guards are stationed in the North Block, particularly outside the offices of key Budget decision makers. Security is a must. Once the pre-budget discussions are concluded the finance minister, working closely along with the Prime Minister takes the final decision on the demands of a variety of parties.
The chief economic advisor, the division of economics is responsible for establishing the basic assumptions for the coming fiscal year, including the possibility of nominal GDP growth as well as the current macroeconomic conditions as well as other pertinent information. This Economic Survey, which is presented to Parliament one day before the Budget is created by the department of economics within the Ministry of Finance.
In January, beginning in January, the Finance Ministry Budget speech gets made. Numerous stakeholders participate in this process, including the Revenue Secretary Economic Affairs Secretary Chief Economic Advisor, as well as the Finance Ministry herself. However, until the final minute, different estimates are discussed and revise.
Halwa Ceremony And Printing Of The Budget
The government organizes an annual halwa celebration to mark the end of the Union budget-making process, which starts around mid-July. Following the serving of “halwa” to the entire employees of the ministry of finance and the finance ministry, the ceremony officially kicks off the printing process of budget documents.
Because of the pandemic and health security concerns, this season’s Halwa celebration was substituted with the gifting of sweets to employees due to being able to “lock-in” at their place of work.
The people who are involved in preparing budgets are Budget will be “locked in” to preserve the confidentiality of the Budget. The entire staff is housed in the Budget Press, which is part of the North Block, during the time before announcement of the Union Budget. Once the Budget is approved, do the employees and officers move out of from the North Block.
Cabinet Approval And Budget Presentation
All of this will come at the end of February 1 , when the Finance Minister gives her address in lawmakers in the Lok Sabha at 11 am following that the Cabinet has approved the Budget and the Finance Minister delivers it to President.
The Union Budget was presented at 5:45 pm on the last business day of February from to the year 1999. In 1999, Yashwant Sinha, the then Union finance minister of the NDA government, changed the tradition by announcement of the budget for 1999 Union Budget on the 11th of February at 11:00 AM. The tradition was established in 2001.
In 2017, a departure from the colonial tradition of giving the Union Budget on the last working day in February, Arun Jaitley announced the Budget on February 1.