Rule 51 of The General Financial Rules 2017 Demands for Grants

Rule 51 of The General Financial Rules 2017 Demands for Grants

Original Rule Text

Rule 51 (1) Demands for Grants. The estimates for expenditure for which vote of Lok Sabha is required shall be in the form of Demand for Grants.Rule 51 (2) Generally, one Demand for Grant is presented in respect of each Ministry or Department. However, in respect of large Ministries or Departments, more than one Demand may be presented. Each Demand normally includes provisions required for a service, i.e. provisions on account of revenue expenditure, capital expenditure, grants to the State and Union Territory Governments and also Loans and Advances relating to the service.Rule 51 (3) The Demand for Grants shall be presented to Parliament at two levels. The main Demand for Grants shall be presented to Parliament by the Ministry of Finance, Budget Division along with the Annual Financial Statement while the Detailed Demands for Grants, for consideration by the “Departmentally Related Standing Committee” (DRSC) of the Parliament, are laid on the Table of the Lok Sabha by the concerned Ministries/ Departments, as per dates approved from time to time.

Visual Summary

Expenditure Estimates

Lok Sabha vote required for these estimates.

Ministry/Department Specific

One or more Demands per Ministry/Department.

Two-Level Presentation

Main by Finance, Detailed by Ministries.

Executive Summary

Rule 51 of The General Financial Rules, 2017, outlines the framework for ‘Demands for Grants’, which are the expenditure estimates requiring a vote from the Lok Sabha. These demands are typically presented as one per Ministry or Department, though larger entities may have more. Each demand encompasses provisions for various services, including revenue and capital expenditure, grants to State and Union Territory Governments, and related loans and advances. The presentation occurs at two levels: a main Demand for Grants by the Ministry of Finance and detailed Demands for Grants by the respective Ministries/Departments for parliamentary committee review.

In-Depth Analysis of the Rule

Introduction: Rule 51 is a foundational element in the budgetary process of the Central Government, detailing how expenditure proposals are formally presented to Parliament for approval. It ensures parliamentary oversight and accountability in public spending.

Breakdown of the Rule:

  • Rule 51 (1) – Form of Demands for Grants: This sub-rule establishes that all expenditure estimates requiring a vote from the Lok Sabha must be presented in the specific format of ‘Demand for Grants’. This formalizes the process by which the executive seeks legislative approval for its spending plans.
  • Rule 51 (2) – Scope and Structure of Demands: It clarifies that generally, each Ministry or Department will have one Demand for Grant. However, larger entities might have multiple. Crucially, each Demand is comprehensive, covering all types of provisions for a service: revenue expenditure, capital expenditure, grants to State and Union Territory Governments, and related loans and advances. This ensures a holistic view of financial requirements for a given service.
  • Rule 51 (3) – Two-Tier Presentation to Parliament: This sub-rule specifies a two-level presentation mechanism. The ‘main Demand for Grants’ is presented by the Ministry of Finance (Budget Division) alongside the Annual Financial Statement. Subsequently, ‘Detailed Demands for Grants’ are laid on the Table of the Lok Sabha by the concerned Ministries/Departments for review by the Departmentally Related Standing Committees (DRSC) of Parliament. This layered approach allows for both a broad overview and granular scrutiny of expenditure proposals.

Practical Example: Imagine the Ministry of Health and Family Welfare requires funds for a new national health program. Under Rule 51, they would prepare their expenditure estimates, which would then be consolidated into a ‘Demand for Grant’. This Demand would detail not only the operational costs (revenue expenditure) but also any capital investments (e.g., new hospitals), grants to state health departments, and loans for specific health initiatives. The Ministry of Finance would present the overall ‘main Demand’ to Parliament, and the Ministry of Health would then present its ‘detailed Demand’ to the relevant Standing Committee for in-depth review before the Lok Sabha votes on the allocation.

Related Provisions

Understanding Rule 51 is enhanced by examining these related provisions:

Learning Aids

Mnemonics
  • Demands For Grants: Dual Format, Government Requires Approval Now To Spend.
Process Flowchart
Expenditure Estimates(Lok Sabha Vote)Formulate Demands(For Grants)Main Demand(Finance Ministry)Detailed Demands(Concerned Ministries)Presented to Parliament(For Approval)

Multiple Choice Questions (MCQs)

1. According to Rule 51 of The General Financial Rules, 2017, what is the primary purpose of “Demands for Grants”?

  • A) To track revenue collections.
  • B) To present expenditure estimates requiring Lok Sabha vote.
  • C) To manage inter-departmental transfers.
  • D) To sanction new projects without parliamentary approval.
Show Answer

Correct Answer: B) To present expenditure estimates requiring Lok Sabha vote.

2. Rule 51 (2) of The General Financial Rules, 2017, states that a Demand for Grant normally includes provisions for which of the following?

  • A) Only revenue expenditure.
  • B) Only capital expenditure.
  • C) Revenue expenditure, capital expenditure, grants to State/UT Governments, and loans/advances.
  • D) Only grants to State and Union Territory Governments.
Show Answer

Correct Answer: C) Revenue expenditure, capital expenditure, grants to State/UT Governments, and loans/advances.

3. How many levels of presentation to Parliament are specified for Demands for Grants under Rule 51 (3) of The General Financial Rules, 2017?

  • A) One level, by the Ministry of Finance.
  • B) Two levels, Main and Detailed.
  • C) Three levels, including a preliminary presentation.
  • D) Four levels, involving various parliamentary committees.
Show Answer

Correct Answer: B) Two levels, Main and Detailed.

4. Who presents the ‘main Demand for Grants’ to Parliament according to Rule 51 (3) of The General Financial Rules, 2017?

  • A) The concerned administrative Ministry/Department.
  • B) The Comptroller and Auditor General of India.
  • C) The Ministry of Finance, Budget Division.
  • D) The Lok Sabha Speaker.
Show Answer

Correct Answer: C) The Ministry of Finance, Budget Division.

5. What is the purpose of the ‘Detailed Demands for Grants’ as per Rule 51 (3) of The General Financial Rules, 2017?

  • A) To provide a summary for the President.
  • B) For consideration by the Departmentally Related Standing Committee (DRSC) of Parliament.
  • C) To inform the public about government spending.
  • D) To secure funds from international agencies.
Show Answer

Correct Answer: B) For consideration by the Departmentally Related Standing Committee (DRSC) of Parliament.

Frequently Asked Questions

Q1: What is the significance of the Lok Sabha vote for Demands for Grants?

The Lok Sabha vote is crucial as it represents parliamentary approval for the government’s proposed expenditures, ensuring democratic accountability and control over public funds as stipulated in Rule 51 (1) of The General Financial Rules, 2017.

Q2: Can a large Ministry have more than one Demand for Grant?

Yes, Rule 51 (2) of The General Financial Rules, 2017, explicitly states that while generally one Demand for Grant is presented per Ministry, large Ministries or Departments may present more than one Demand to cover their extensive services and provisions.

Q3: What is the role of the Departmentally Related Standing Committee (DRSC) in the process of Demands for Grants?

As per Rule 51 (3) of The General Financial Rules, 2017, the Detailed Demands for Grants are laid on the Table of the Lok Sabha for consideration by the DRSC, allowing for in-depth scrutiny and review of the expenditure proposals by parliamentary committees.

Key Takeaways

  • Rule 51 mandates that all expenditure estimates requiring Lok Sabha approval are presented as ‘Demands for Grants’.
  • Each Demand for Grant is comprehensive, covering revenue, capital, grants to states/UTs, and loans/advances for a specific service.
  • The presentation of Demands for Grants is a two-tiered process: main demands by the Ministry of Finance and detailed demands by concerned Ministries for parliamentary committee review.
  • This rule is central to ensuring parliamentary control and transparency over government spending.

Conclusion

Rule 51 of The General Financial Rules, 2017, is a cornerstone of financial governance, establishing the formal mechanism for parliamentary authorization of government expenditure. By defining the structure and presentation of Demands for Grants, it ensures that public funds are allocated and spent with due legislative oversight, promoting accountability and fiscal discipline across all Ministries and Departments.