New Delhi Finance Ministry has launched an exercise to revamp the role of Financial Advisors—the interface between various ministries and the Department of Expenditure—with an aim to promote quicker and more efficient decision-making while keeping an eye on purse strings.
The idea is to build more capacity across ministries and departments to improve decision-making on “schemes, projects, policies and utilization of funds”, according to the two officials.
The plan to revive the decades-old role of financial advisors is part of the government’s Vision 2047 which aims to make the country one of the top three economies in the world by the 100th year of independence.
An official, speaking on condition of anonymity, said the aim is to find a solution to the underlying tension between the different departments implementing the schemes and the expenditure department that controls the government’s spending.
“Efficiency and productivity will be the drivers for Vision 2047, and better financial control over the execution of policies and plans,” said the second official.
Given that the performance of individual ministers is often assessed by the results of schemes, even though the Department of Expenditure takes care of the financial position of the Centre, the role of financial advisors is sensitive and crucial in day-to-day decision-making in the central government. Has been.
Sometimes, the expenditure department has to cut non-priority administrative expenses and reject proposals to create new posts, as it did during the pandemic. The reform could also give financial advisors a greater authority in the expenditure roadmap of ministries with more authority, possibly to enable better internal governance.
The move is significant considering the size of the Union Budget- 39 trillion in FY23. Its, 7.5 trillion is meant for capital expenditure alone aimed at giving an immediate boost to the economy.
The Parliamentary Standing Committee on Finance, led by BJP leader Jayant Sinha, in its report to the House in March, had emphasized the importance of using this fund “productively, efficiently and adequately”.
The move also signals the government’s desire to make the use of the fund more effective.
The Center often faces the issue of savings under various schemes at the time of supplementary demands for grants, indicating constraints in planning or spending at different levels.
Mint has learned that the Finance Ministry has constituted an internal working group under the Department of Expenditure to seek views from all ministries and departments on how the role of financial advisor can be improved.
Considerations have been sought on driving efficiency, enabling faster decision making and execution of projects, policies and plans through inter-departmental and faster movement of files within departments.
Queries sent to the Finance Ministry on Saturday did not elicit any response at press time.
gulveen.aulakh@livemint.com