Final Print
1
13 WWW.ECONOMICTIMES.COM Economy Deepshikha.Sikarwar @timesgroup.com New Delhi: "No! He can't take that file out." The security personnel guarding the printing press at the finance ministry were most vehe- ment, and with good reason. The in- cident took place a few years ago. The budget—one of the most se- cret financial documents in the en- tire government system until it’s public unveiling— was being print- ed. During this two-week period, those who oversee the printing aren’t even allowed to go home, re- maining sequestered within the North Block basement area where the presses are kept. And here was this person walking out with that holiest of holies—the Blue Sheet. This sheet contains the key eco- nomic numbers that form the ba- sis for the budget’s calculations and is updated as new data come in. It’s one of the most secret of all the budget’s elements. But unlike the currently unfold- ing scandal involving the wide- spread theft of government docu- ments that has drawn in various ministries and companies, the above incident was soon resolved. The person carrying out the doc- ument was in fact the author of the budget—the finance minister of the time. Luckily, the joint secreta- ry, budget, was present and could sort things out quickly. Under the rules, only this official is allowed to keep the Blue Sheet—the securi- ty officers were just following pro- tocol. That incident passed off, leaving just an air of embarrassed relief. But this time, the level of conster- nation hasn’t abated, given the na- ture of the revelations. The fi- nance ministry, however, has strict rules in place to prevent any unauthorised leaks, especially when it comes to the budget. The Blue Sheet referred to above contains the barebones structure, the cold numbers that are funda- mental to policy. These are then fleshed out using other data less- exacting instruments of explana- tion. The first Blue Sheet gets pre- pared sometime in December when budget proposals start tak- ing shape after intense discus- sions. The picture undergoes sev- eral changes, as reflected in the Blue Sheet, till the finance minis- ter freezes proposals to be un- veiled in the final budget docu- ment on the last day of February. Finance minister Arun Jaitley will announce the budget on Feb- ruary 28 in the Lok Sabha. The budget printing exercise is kicked off with the ‘halwa’ ceremony, a tradition whose origins are now lost in the mists of time. It involves dragging out the kadhai used for this purpose from the nether re- cesses of the building and prepar- ing the sweet, which is served at a ceremony attended by all ministry officials starting from the finance minister. Once the printing starts, the se- curity kicks up a notch. Security officials adopt a standard operat- ing procedure that clearly lays down who can take documents in and out of the area. The usual practice is that only the joint secretary, bud- get, can take doc- uments out while members of his team can take them in. Beyond the excep- tions stipulated, not “even a scrap of paper” can go in or out, said a government official privy to the budget process. All electronic de- vices have to be deposited at the entrance before anyone goes in- side the press. Even the finance minister can’t take his mobile phone in. North Block turns into even more of a fortress with Intel- ligence Bureau personnel keeping a close watch on officials associat- ed with the budget process. Move- ments are followed and phones tapped—sometimes even the mo- biles of journalists covering the ministry may be monitored. "I avoid calling people at home during these days," said another official. Leaking of budget docu- ments is a violation of the Offi- cials Secrets Act and a breach of parliamentary privilege, some- thing every government dreads. The budget is first read out in the Lok Sabha and this has to be the first public airing of the docu- ment. Any advance peek at tax pro- posals or policy changes is akin to having access to inside informa- tion that can used for monetary gain, including market-moving advantage. But there is a view that keeping such a tight lid on the bud- get doesn’t make sense nowadays. This is in line with the argument that budgets need to become pre- dictable and in line with long- term, well-established fiscal poli- cy. "In some countries, the budget is put in the public domain three months before it is presented," pointed out former expenditure secretary D Swarup, who was closely associated with budget making for years. “There is noth- ing secret in the expenditure bud- get... The three documents on FRBM (Fiscal Responsibility and Budget Management) presented with the budget should be placed in the public domain before they are presented for some discussion.” Given that the plan to switch over to a goods and services tax by April 1, 2016, is part of a strategy that will ensure long-term predictability, perhaps such openness could come sooner rather than later. North Block Staff Fiercely Guarding Budget Blueprint NO SNEAK PEEK Finance ministry has strict rules in place to prevent any unauthorised leaks The Blue Sheet contains the barebones structure, the cold numbers that are fundamental to policy Press Trust of India New Delhi: Retirement fund body EPFO is planning to provide medi- cal benefits under its pension scheme through the Employees' State Insurance Corporation, a move which would immediately benefit around 46 lakh pensioners. The Employees' Provident Fund Organisation's (EPFO) Pension & EDLI Implementation Committee (PEIC) has recently concluded in its meeting held on January 30 that the pensioners should be extended the facility of medical benefits. “..medical benefit as an extra ben- efit should be recommended to La- bour Ministry,” the committee con- cluded as per the minutes of the committee's meeting held last month. It was also pointed out in the meeting that retired government employees are provided medical benefits under the Central Govern- ment Health Services and even un- organised workers are covered un- der the Rashtriya Swasthya Bima Yojana (RSBY) but there is no such facility for EPFO pensioners. A se- nior official said, “If EPFO choos- es the ESIC for extending health benefits to its pensioners then they would be able to use the OPD (out patient department) facility of ES- IC hospitals and dispensaries as well as other health benefits pro- vided by it to insured persons.” EPFO Plans Medical Schemes for 46L Pensioners ARINDAM Five Big Budget Ideas Make in India 3 Policy framework being put in place. Ease of doing business getting continuous attention. Some tax sops could be announced in the budget Defence manufacturing kicking off in a big way. Many cos have already announced deals with foreign cos THE X FACTOR More jobs, higher exports, cheaper goods, fewer imports WHO GAINS? Bigger Direct Benefit Transfer 1 The LPG subsidy has begun to flow to accounts. Food, kerosene, and fertilisers could follow in the budget Hugely successful Pradhan Mantri Jan Dhan Yojana with more than 12 crore accounts opened THE X FACTOR Poor get benefits, govt subsidies get cut, consumer demand will rise WHO GAINS? Massive Infrastructure Push 2 Successful coal auctions, lower crude prices, cheap global money, faster decision-making THE X FACTOR Investment activity will pick up pace as mining gets under way; capital goods, power & engineering companies biggest gainers WHO GAINS? Coal auctions have started. Bids for road projects are gathering pace and 15km/day should be doable by the end of March. The railway budget should get that sector going. Roads could get much bigger funds Bigger devolution of funds to states as suggested by the 14th Finance Commission THE X FACTOR Economic activity spreads to rural India, more income to farmers through productivity WHO GAINS? Bharat Plan 4 Work started on Swacch Bharat, Digital India and roads. The budget could announce a very big package for farm sector to make it more efficient, with a focus on irrigation Other Significant Ideas That Budget May Include Tax incentives to boost savings More money in the hands of consumers to spur demand Greater freedom to forex earners to raise funds overseas Reform of food distribution by recast of FCI More incentives for housing; higher limit for interest deduction and benefit made available from date of loan and not possession Further easing of FDI norms to bring in more funds Measures to reduce tax litigation and more steps to curb aggressive taxation Super rich surcharge could continue A cess on petrol and diesel may be on the way Import duty could be levied on crude Income tax payees could be asked to give up cooking gas subsidy Some tax settlement to end past cases and raise funds Where Will The Money Come From? Cheap Loans 5 Jan Dhan Yojana architecture can be the backbone for a financial inclusion miracle THE X FACTOR Rural stress goes down. Financial implication is minimal WHO GAINS? Very cheap, even zero interest loans, to farmers, students for skilling and small vendors to reach formal credit going, subsidised by the budget 0% ANY OF THESE COULD TRANSFORM THE FINANCE MINISTER’S FEBRUARY 28 ANNOUNCEMENT
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Economy
New Delhi: "No! He can't take thatfile out." The security personnelguarding the printing press at thefinance ministry were most vehe-ment, and with good reason. The in-cident took place a few years ago.
The budget—one of the most se-cret financial documents in the en-tire government system until it’spublic unveiling— was being print-ed. During this two-week period,those who oversee the printingaren’t even allowed to go home, re-maining sequestered within theNorth Block basement area wherethe presses are kept. And here wasthis person walking out with thatholiest of holies—the Blue Sheet.This sheet contains the key eco-nomic numbers that form the ba-sis for the budget’s calculationsand is updated as new data comein. It’s one of the most secret of allthe budget’s elements.
But unlike the currently unfold-ing scandal involving the wide-spread theft of government docu-ments that has drawn in variousministries and companies, theabove incident was soon resolved.
The person carrying out the doc-ument was in fact the author of thebudget—the finance minister ofthe time. Luckily, the joint secreta-ry, budget, was present and couldsort things out quickly. Under therules, only this official is allowedto keep the Blue Sheet—the securi-ty officers were just following pro-tocol.
That incident passed off, leavingjust an air of embarrassed relief.But this time, the level of conster-nation hasn’t abated, given the na-ture of the revelations. The fi-nance ministry, however, hasstrict rules in place to prevent anyunauthorised leaks, especiallywhen it comes to the budget.
The Blue Sheet referred to abovecontains the barebones structure,the cold numbers that are funda-mental to policy. These are thenfleshed out using other data less-exacting instruments of explana-tion. The first Blue Sheet gets pre-pared sometime in Decemberwhen budget proposals start tak-ing shape after intense discus-sions. The picture undergoes sev-eral changes, as reflected in theBlue Sheet, till the finance minis-ter freezes proposals to be un-veiled in the final budget docu-ment on the last day of February.
Finance minister Arun Jaitleywill announce the budget on Feb-ruary 28 in the Lok Sabha. Thebudget printing exercise is kickedoff with the ‘halwa’ ceremony, atradition whose origins are nowlost in the mists of time. It involvesdragging out the kadhai used forthis purpose from the nether re-cesses of the building and prepar-
ing the sweet, which is served at aceremony attended by all ministryofficials starting from the financeminister.
Once the printing starts, the se-curity kicks up a notch. Securityofficials adopt a standard operat-ing procedure that clearly lays
down who cantake documentsin and out of thearea. The usualpractice is thatonly the jointsecretary, bud-get, can take doc-uments outwhile membersof his team can
take them in. Beyond the excep-tions stipulated, not “even a scrapof paper” can go in or out, said agovernment official privy to thebudget process. All electronic de-vices have to be deposited at theentrance before anyone goes in-
side the press. Even the financeminister can’t take his mobilephone in. North Block turns intoeven more of a fortress with Intel-ligence Bureau personnel keepinga close watch on officials associat-ed with the budget process. Move-ments are followed and phonestapped—sometimes even the mo-biles of journalists covering theministry may be monitored.
"I avoid calling people at homeduring these days," said anotherofficial. Leaking of budget docu-ments is a violation of the Offi-cials Secrets Act and a breach ofparliamentary privilege, some-thing every government dreads.
The budget is first read out in theLok Sabha and this has to be thefirst public airing of the docu-ment. Any advance peek at tax pro-posals or policy changes is akin tohaving access to inside informa-tion that can used for monetarygain, including market-movingadvantage. But there is a view thatkeeping such a tight lid on the bud-get doesn’t make sense nowadays.This is in line with the argumentthat budgets need to become pre-dictable and in line with long-term, well-established fiscal poli-cy. "In some countries, the budgetis put in the public domain threemonths before it is presented,"pointed out former expendituresecretary D Swarup, who wasclosely associated with budgetmaking for years. “There is noth-ing secret in the expenditure bud-get... The three documents onFRBM (Fiscal Responsibility andBudget Management) presentedwith the budget should be placed inthe public domain before they arepresented for some discussion.”
Given that the plan to switch overto a goods and services tax by April1, 2016, is part of a strategy that willensure long-term predictability,perhaps such openness could comesooner rather than later.
North Block Staff FiercelyGuarding Budget Blueprint NO SNEAK PEEK Finance ministry has strict rules in place to prevent any unauthorised leaks
The Blue Sheetcontains thebarebonesstructure, thecold numbersthat arefundamentalto policy
Press Trust of India
New Delhi: Retirement fund bodyEPFO is planning to provide medi-cal benefits under its pensionscheme through the Employees'State Insurance Corporation, amove which would immediatelybenefit around 46 lakh pensioners.
The Employees' Provident FundOrganisation's (EPFO) Pension &EDLI Implementation Committee(PEIC) has recently concluded inits meeting held on January 30 thatthe pensioners should be extendedthe facility of medical benefits.
“..medical benefit as an extra ben-efit should be recommended to La-bour Ministry,” the committee con-
cluded as per the minutes of thecommittee's meeting held lastmonth.
It was also pointed out in themeeting that retired governmentemployees are provided medicalbenefits under the Central Govern-ment Health Services and even un-organised workers are covered un-der the Rashtriya Swasthya Bima
Yojana (RSBY) but there is no suchfacility for EPFO pensioners. A se-nior official said, “If EPFO choos-es the ESIC for extending healthbenefits to its pensioners then theywould be able to use the OPD (outpatient department) facility of ES-IC hospitals and dispensaries aswell as other health benefits pro-vided by it to insured persons.”
EPFO Plans Medical Schemes for 46L Pensioners
AR
IND
AM
Five BigBudget Ideas
Make in India3
Policy framework being put in place. Ease of doing business getting continuous attention. Some tax sops could be announced in the budget
Defence manufacturingkicking off in a big way. Many cos have already announced deals with foreign cos
THE X FACTORMore jobs, higher exports, cheaper goods, fewer imports
WHO GAINS?
Bigger Direct Benefit Transfer 1
The LPG subsidy has begun to fl ow to accounts. Food, kerosene, and fertiliserscould follow in the budget
Hugely successful Pradhan Mantri Jan DhanYojana with more than 12 crore accounts opened
THE X FACTORPoor get benefi ts,govt subsidies getcut, consumerdemand will rise
WHO GAINS?
Massive Infrastructure Push2
Successful coal auctions, lower crude prices, cheap global money, faster decision-making
THE X FACTORInvestment activity will pick up pace as mining gets under way; capital goods, power & engineering companies biggest gainers
WHO GAINS?
Coal auctions have started. Bids for road projects are gathering pace and 15km/day should be doable by the end of March. The railway budget should get that sector going. Roads could get much bigger funds
Bigger devolution of funds to states as suggested by the 14th Finance Commission
THE X FACTOREconomic activity spreads to rural India, more income to farmers through productivity
WHO GAINS?
Bharat Plan4Work started on Swacch Bharat, Digital India and roads. The budget could announce a very big package for farm sector to make it more effi cient, with a focus on irrigation
Other Significant Ideas ThatBudget May IncludeTax incentives to boost savings
More money in the hands of consumers to spur demand
Greater freedom to forex earners to raise funds overseas
Reform of food distribution by recast of FCI
More incentives for housing; higher limit for interest deduction and benefi t made available from date of loan and not possession
Further easing of FDI norms to bring in more funds
Measures to reduce tax litigation and more steps to curb aggressive taxation
Super rich surcharge could continue
A cess on petrol and diesel may be on the way
Import duty could be levied on crude
Income tax payees could be asked to give up cooking gas subsidy
Some tax settlement to end past cases and raise funds
Where Will The Money Come From?
Cheap Loans5
Jan Dhan Yojana architecture can be the backbone for a fi nancial inclusion miracle
THE X FACTORRural stress goesdown. Financial implication is minimal
WHO GAINS?
Very cheap, even zero interest loans, to farmers, students for skilling and small vendors to reach formal credit going, subsidised by the budget
0%
ANY OF THESE COULD TRANSFORM THE FINANCE MINISTER’S
FEBRUARY 28 ANNOUNCEMENT
