PowerPoint Presentation
1Budget for Medical Foundation Course OfficersHemant Godbole,
IRAS,Sr. Professor (Financial Management)
National Academy for Indian RailwaysVadodara, 390004
2Salient Features of Indian Railways Department of Government of
India (GoI).
Unlike most other Departments, it is Commercial in nature. It is
in the business of transportation where value is created for the
customers who avail of such services.
3Separation ConventionPursuant to the recommendations of the
Acworth Committee (1920-21), Railway Finances were separated in
1924 from General Finances, primarily to secure stability for civil
estimates by providing for an assured contribution from Railway
Revenues and also to introduce flexibility in the administration of
Railway Finances. Railway Budget was thus separated from
19244Consequent to the ConventionAmount invested by GoI in Railways
is treated as Loan Capital (called Capital at charge) for the use
of which Railways to pay dividends (actually interest; current rate
5 %) to GOI. Additional loan received every year is called
Budgetary Support The Financial Commissioner (FC, who is a member
of the Railway Board) would be a representative of MoF on Railways.
FC heads the of Accounts Department of IR
5Railway Budget is a part of General Budget
Para 301 F-I
Though the Railway Budget is separately presented to Parliament,
the figures relating to the receipts and expenditure of the
Railways are also shown in the General Budget(Para 301 Finance Code
Vol. I)6Relationship of Railway Budget with General BudgetIncome
from Railways is shown as non-tax revenue by GoI and expenditure of
Railways is a part of GoIs expenditure. Railway being Govt.
Department, all provisions of the Constitution of India which are
applicable to General Budget are also applicable to
Railways.7.ContdReceipts of the Railways (freight, fares etc.) are
deposited with the Consolidated Fund of India (CFI) and expenditure
on the Railways also comes out of CFI, after authorization by
Parliament. Consolidation takes place in RBI.
Expenditure can be incurred only after passing of the budget (or
vote on account) and passing of Appropriation Act. . 8.Contd
Expenditure is divided into voted and charged. Charged expenditure
is for independent constitutional functionaries like C&AG and
for decrees of the courts, awards of tribunals etc. Charged
expenditure is directly sanctioned by the President, other
expenditure requires Parliaments vote Rationale of Charged
Expenditure: This is done for preserving the independence t of such
institutions / functionaries9Capital and Revenue ExpenditureFor the
expenditure on the Railways, there is a provision of 16 different
Demands for Grants to be made on the Parliament through the Budget
Demand No. 1 to 15 are for Revenue Expenditure and Demand no. 16 is
for the Capital Expenditure (CAPEX).Revenue Expenditure is
typically financed from Revenue Earnings, while CAPEX is financed
partly from loan from the GoI. and partly from provisions /
internal savings of the Railways (like DRF, DF, Capital Fund).
10Contd.. CAPEX under Demand No. 16 is Railways Annual Plan. This
is a subset of GOIs. Annual Plan as a part of GOIs Five Year Plan.
Expenditure under Demand No. 16 is thus an outlay over various Plan
Heads like new lines, doubling, electrification, passenger
amenities, rolling stock etc.
Demands for Grants and concept of Primary UnitsRailways make
various Demands on Parliament, requesting them for grantsDetails of
various Revenue Demands are given in next slide.While Demands
denote activities, Primary Units give objects of expenditure into
which each activity is broken down. Details are given in subsequent
slides.1112
From Finance Code Vol. II
13Primary Units(Objects of Expenditure)01Salaries and
Wages02Dearness Pay and Dearness Allowance03Productivity Linked
Bonus04House Rent allowances05Compensatory (City)
Allowances06Interim Relief08 Railways contribution to NPS09Wages of
Casual Labour10Kilometre allowance11Overtime allowance
14Primary Units--contd12 Night duty allowances13Other
allowances14Fees and honoraria15Transfer allowance16Travelling
expenses17Air Travel Expenses sanctioned in lieu of privilege
passes18Office expenses19Rental for P&T telephone and call
charges including Trunk calls20 Leave Encashment During the
service21Advertising expenses
15Primary Units--contd22Utilities23Rental for office
equipment(other than Data Processing)24Printing and stationery
including Publications25 Children Education Allowance27Cost of
materials from stock28Cost of materials-Direct
purchase32Contractual payments33Transfer of debits16Primary
Units--contd36Excise duty paid/payable for purchase of
materials37Customs duty paid/payable for purchase of
materials.38Sales Tax paid/payable for purchase of materials.39Air
Travel (Domestic)40Air Travel (Foreign)99Other expenses.
17Role of Medical Department Ensuring wellness of all railway
employees and their family members through preventive and curative
interventions (technological and human) to facilitate better
performance for IR. Revenue Demand for Medical Department: Demand #
11Details of what sub-activities this demand covers and the related
costs, are given in a following slides
18CLASSIFICATION OF REVENUE EXPENDITURE App.1Demand No.11
Abstract J (Staff welfare and Amenities)
Minor HeadsSub-HeadsDetailed Heads200 Medical Services210
Control and superintendence at HQs and Divisions.211 Officers213
Office establishments.214 Other medical and nursing staff215
Contingent expenses.220 Hospital and Dispensaries excluding Cost of
Medicines.221 Diet charges.222 Cost of artificial limbs appliance,
braces, calipers, orthopedic "shoe" etc.223 Accident Relief Medical
equipment.19
CLASSIFICATION OF REVENUE EXPENDITURE App.1Demand No.11 Abstract
J
Minor HeadsSub-HeadsDetailed Heads200 Medical Services
230 Cost of Medicines.231 Cost of Medicines.232 Cost of Surgical
instruments and appliances etc.240 Reimbursement of Medical
expenses and miscellaneous.241 payment of non-Railway institutions
for treatment, and assistance to other Medical Institutions.243
Cost of T. B. treatment in sanatoria.245 Other expenses.20
CLASSIFICATION OF REVENUE EXPENDITURE App.1Demand No.11 Abstract
J
Minor HeadsSub-HeadsDetailed Heads200 Medical Services
240 Reimbursement of Medical expenses and miscellaneous.
245 Other expenses.250 Public Health.251 Staff.252 Medicine-Cost
thereof and freight charges.260 Maintenance of equipments- Medical
Department.261 Repairs and servicing charges of different
equipments viz. X-Ray, E. C. G., etc. including cost of sharpening,
polishing of surgical instruments.21CLASSIFICATION OF REVENUE
EXPENDITURE App.1Demand No.11 Abstract J
Minor HeadsSub-HeadsDetailed Heads200 Medical Services
260 Maintenance of equipments- Medical Department.
262 Repairs and Maintenance of Ambulances.263 Hospital
furniture.300 Health and Welfare services310 Sanitation in Railway
Colonies311 Sanitary staff.312 Sanitary stores.313 Contingent
expenses.22CLASSIFICATION OF REVENUE EXPENDITURE App.1Demand No.11
Abstract J
Minor HeadsSub-HeadsDetailed Heads300 Health and Welfare
services310 Sanitation in Railway Colonies314 Payment to
Conservancy Contractors and Municipalities.315 Maintenance and
repairs to Motor trucks(Refuse/Night soil Lorries and Carts)316
Lighting (other than Electric) in Railway Colonies and areas.317
Other expenses.23CLASSIFICATION OF REVENUE EXPENDITURE App.1Demand
No.11 Abstract J
Minor HeadsSub-HeadsDetailed Heads300 Health and Welfare
services
Preventive Health Measures and Pest Control350 Other Welfare
services.351 Malaria, Filaria and Pest control staff353 Cost of
Malaria, FiIaria and Pest control stores.354 Cost of Prophylactic
Lymph Sera Vaccines, anti-lexine, Loxorus including
eentinalicntinalic vaccine etc.355 Examination of, Food and Water
samples in State Laboratories.356 Other expenses.24CLASSIFICATION
OF REVENUE EXPENDITURE App.1EXPLANTORY NOTES Abstract `JJ.211
J.215This head will also record Non-Practising allowance to
Doctors under Primary Unit 13.Contingent Expenses will include all
expenditure incidental to the upkeep of the office such as
stationery, forms, printing charges, books, publications, uniforms,
clothing to class IV staff, departmental advertising charges, cost
of repairs and maintenance of typewriters and accounting machines
etc., rental for office equipment (other than data processing),
conveyance hire to staff at Headquarters or outstations, taxi hire
to officers, rental for P &T telephones and call charges
including trunk calls, water, electric light and power expenditure,
and miscellaneous other charges. In respect of Medical Department
cost of dressing material, laboratory sera and laboratory antigens,
X-ray films, X-ray contrast media and dyes, dispensing appliances
anesthetic instruments and appliances including nursing appliances,
orthopedic instruments and appliances general and special surgical
instruments and appliances, physiotherapy and occupational therapy
equipment will also be recorded under this head.25CLASSIFICATION OF
REVENUE EXPENDITURE EXPLANTORY NOTES Abstract `JJ. 231,232
J.313The contingent expenses for Medical Department to up keep
the office and the instruments and appliances etc. will continue to
be booked under existing detailed heads viz. J-215 & J-313.
Details are exactly as given for J. 215, as applicable to this
activity, viz sanitation in Railway Colonies26CLASSIFICATION OF
REVENUE EXPENDITURE EXPLANTORY NOTES Abstract `JJ. 221
J.223Will bear diet charges for Railway staff, indigent
passengers, trespassers and employees injured in accidents who are
entitled to free diet under existing orders.Represents cost of
articles required for equipping medical vehicles attached to relief
trains according to the prescribed scale.J.230Will record cost and
carriage of medicines including blood therapeutic sera,
anti-toxins, medical oxygen, nitrous oxide cyclopropane, holthane
etc. and dental drugs, including packing charges.J.241Will also
record the expenditure connected with the reimbursement of medical
expenses of Railway employees and their families entitled to
treatment free of charge, as well as the amount of contribution
paid by the Railway to non-Railway Hospitals as well as charges on
account of the cost of school of Tropical Medicines and Hygiene,
Calcutta.27CLASSIFICATION OF REVENUE EXPENDITURE EXPLANTORY NOTES
Abstract `JJ.245
J.261Will record miscellaneous expenditure e.g., fees for
attending medical boards as members and such charges as are not
included under any detailed heads under J. 200.Will also include
maintenance of other electrical equipment in Hospitals and Health
units.J.550Welfare buildings will include hospitals, health units,
dispensaries
etc.http://www.indianrailways.gov.in/railwayboard/uploads/codesmanual/FINANCECODE/abstract_z.htmhttp://www.indianrailways.gov.in/railwayboard/uploads/codesmanual/FINANCECODE/abstract_j.htm
http://indianrailways.gov.in/railwayboard/uploads/codesmanual/FINANCECODE/appn-2.htm
Links:2828Preparation of BudgetResponsibility for framing the
Estimates.- Preparation of the Revised and Budget Estimates
commences at the 'grass root level , i.e., Division, Workshop,
Stores Depot etc., as the case may be. The entire responsibility
for framing the estimates devolves upon the spending / earning
authorities concerned, though the actual work of compilation and
scrutiny is with the FA&CAO29Presentation and passing of
BudgetPresented to Parliament for voted portionFor charged portion
President approves appropriation from CFIAppropriation Bill and
ActBudget Grants
3031Budgetary Control and Review ProcessControl over expenditure
including exchequer controlFor Revenue/ Works grants, Reviews
Monthly, August, Revised , Final Modification and telegraphic
modifications Supplementary Grants, Re-appropriationAppropriation
Accounts and Audit certificate thereon-Reviewed by Public Accounts
Committee (Parliamentary Control)32Capital BudgetConstruction of
new hospital buildings/expansion of existing buildings etc.
(Coordinated by Principal Chief Engineer)Machinery and Plant
Programme (M&P) on replacement account and additional account
Equipments & Vehicles etc. (Coordinated by CME)GMs powers
(Ann.II to para 505 of Finance Code Vol. I)33Important Source of
Funds for Capital expenditure Internal generation Depreciation
Reserve Fund Development Fund Capital Fund
34Important Source of Funds Capital expenditure contd. External
Sources Capital at Charge
Extra budgetary Sources Market borrowings through IRFC to
finance RSP, M&P items.PPP for major projectsNational Rail
Vikas Yojana projects through RVNL35Plan Heads (Finance Code Vol.
II)Plan HeadsNamePlan HeadsName11New Lines12Purchase of new
lines13Restoration of dismantled lines14Gauge
conversion15Doubling16Traffic facilities, yard remodelling36Capital
Plan Heads --contdPlan HeadsNamePlan
HeadsName17Computerization18Railway Research21Rolling stock29Road
Safety Works-level crossing30Road Safety works-Road Over/under
bridges31Track renewals37Capital Plan Heads --contd32Bridge
works33Signaling and Telecomm works34Taking over line wires from
P&T dept35Electrification projects3637Other electr. excl
TRDTraction Distribution 41Machinery and Plant42Workshops
incl.Prod.units51Staff quarters38Capital Plan Heads
---contd52Amenities for staff53Passengers amenities62Investments in
Govt. Comm. Undertaking64Other Specified Works71Stores
Suspense72Manufacture Suspense73Miscellaneous
advances81Metropolitan Transport projects39Primary Units (Objects)
Expenditure for Works1Pay& allowances of Departmental
Establishment012Payment to Casual Labour023Payment to contractors
and others for Engineering works or supply and erection contracts
etc.034Direct supply of material0440Primary
Units(Objects)Expenditure for Works---contd5Stores supplied from
stock056Freight on stores067Credits for released
material078Others089Transfer of debits/credits affecting capital
works expenditure/suspense accounts0941Primary
Units(Objects)Expenditure for Works--contd10Productivity Linked
Bonus1011Excise duty paid/payable for purchase of
materials1112Customs Duty 1213Sales Tax 1314Interim
Relief1415Travelling Expenses1516Air Travel(Domestic)1617Air
Travel(Foreign)17Revenue Budget for Medical Department within
Demand #11: 2015-16 (Rs Cr.)200Medical services 2477310 Sanitation
in colony 592350 Other welfare services 16 ---------Total 3085Ref:
Pl. see Demand No. 11 in Railway Budget 2015-16 at pages 11.02.1
and 11.02.2 with following link
(http://www.indianrailways.gov.in/railwayboard/uploads/directorate/finance_budget/Budget_2015-16/DB-1_2015-16.pdf)4243Issues
for Discussion Permitting private persons to avail railway services
and use our idle asset capacity and earn additional revenue?
(in-sourcing)Outsourcing some of the activities (if viable)How to
use outside expertise public- private partnerships?
44Road AheadBest utilization of human resources, machines and
materialsCompetitive Life cycle cost for machines and materials
Simplification of procedures, use of technology for better
effectiveness less cost Planning for assets and their
maintenancePrudent investment for capacity
de-bottlenecking/expansion with justification
45Road Ahead contd.Critical examination of each item of
expenditure to reduce it to the extent possible without affecting
quality of serviceAdopting zero base budgeting system, substitution
/ value engineeringPreventive ~ curative trade offAdopting
performance budgeting system 46Conclusion Budgeting is a managerial
tool which helps management achieve targets assigned to them by
planning for commensurate availability of money. So it is necessary
to frame and use the budget judiciously.Thank
You47Sheet1CLASSIFICATION OF REVENUE EXPENDITURE APP. ISr.No.Group
Demand NoName of demand I. Policy Formulation and Services Common
to all Railways 1 Railway Board 2Miscellaneous Expenditure
(General) II. General Superintendence and Services on Railways
3General Superintendence and Services on Railways. III.Repairs and
Maintenance 4Repairs and Maintenance of Permanent Way and Works.
5Repairs and Maintenance of Motive Power. 6Repairs and Maintenance
of Carriages and Wagons. 7Repairs and Maintenance of plant and
Equipment IV.Operation 8Operating Expenses-Rolling Stock and
Equipment. 9Operating Expenses-Traffic. 10Operating Expenses-Fuel.
V.Staff Welfare, Retirement Benefits and Miscellaneous 11Staff
Welfare and Amenities.12Miscellaneous Working Expenses. 13Provident
Fund, Pension and other Retirement Benefits. VI. Railway Funds and
payment to General Revenues. 14Appropriation to Funds. 15Dividend
to General Revenues .
Sheet2
Sheet3
