Rule 55 of The General Financial Rules 2017 Vote on Account
Original Rule Text
Visual Summary
Temporary expenditure authorization.
Appropriation Bill delay.
Not for ‘New Service’.
Executive Summary
Rule 55 of the General Financial Rules, 2017 outlines the concept of a ‘Vote on Account’. This mechanism allows the Finance Ministry to secure parliamentary authorization for essential government expenditure for a brief period when the main Appropriation Bill, which sanctions the full budget, is delayed beyond the start of the new financial year. Crucially, funds obtained through a Vote on Account are strictly limited to existing services and cannot be used for any ‘New Service’.
In-Depth Analysis of the Rule
Rule 55 addresses a critical procedural aspect of government financial management, ensuring continuity of essential services even when the full budget approval process extends beyond the financial year’s commencement.
Breakdown of the Rule:
- Purpose: To authorize expenditure for a short duration.
- Trigger: Delay in passing the main Appropriation Bill.
- Authority: Finance Ministry, in accordance with Article 116 of the Constitution.
- Scope: Covers expenditure for a “brief period.”
- Limitation: Funds cannot be used for a ‘New Service’.
Practical Example:
If the Union Budget for the financial year 2024-25 is presented in February 2024 but the Appropriation Bill is still under parliamentary debate in April 2024 (the start of the new financial year), the Finance Ministry can seek a ‘Vote on Account’. This allows the government to continue paying salaries, maintaining essential services, and meeting ongoing commitments for a few months (e.g., April and May) until the full budget is passed. However, during this period, no new projects or schemes (classified as ‘New Service’) can be initiated using these funds.
Related Provisions
Understanding Rule 55 is enhanced by considering these related provisions:
- Rule 50 of The General Financial Rules 2017 Expenditure Estimates: Details how expenditure estimates are prepared, including distinctions for voted and charged expenditure, which are relevant to the overall budget process that a Vote on Account temporarily bypasses.
- Rule 51 of The General Financial Rules 2017 Demands for Grants: Explains the format and presentation of Demands for Grants, which are the primary mechanism for seeking parliamentary approval for expenditure, and whose delay necessitates a Vote on Account.
- Rule 63 of The General Financial Rules 2017 Expenditure on New Service: Defines what constitutes a “New Service” and specifies that no expenditure shall be incurred on it without a supplementary grant or advance from the Contingency Fund, directly reinforcing the restriction mentioned in Rule 55.
Learning Aids
Mnemonics:
- VOTE: Very Often Temporary Expenditure (for Vote on Account)
Process Flowchart:
Multiple Choice Questions (MCQs)
1. What is the primary purpose of a ‘Vote on Account’ under Rule 55 of the General Financial Rules, 2017?
- A) To authorize expenditure for new projects.
- B) To cover government expenditure for a brief period when the Appropriation Bill is delayed.
- C) To approve the full annual budget.
- D) To re-appropriate funds between different heads.
Show Answer
Correct Answer: B) To cover government expenditure for a brief period when the Appropriation Bill is delayed.
2. According to Rule 55 of the General Financial Rules, 2017, under which constitutional article is a ‘Vote on Account’ obtained?
- A) Article 112
- B) Article 113
- C) Article 116
- D) Article 266
Show Answer
Correct Answer: C) Article 116
3. Funds made available under a ‘Vote on Account’ as per Rule 55 of the General Financial Rules, 2017, are explicitly prohibited from being used for what?
- A) Salaries of government employees.
- B) Existing ongoing schemes.
- C) Expenditure on a ‘New Service’.
- D) Maintenance of public infrastructure.
Show Answer
Correct Answer: C) Expenditure on a ‘New Service’.
4. Who is responsible for obtaining a ‘Vote on Account’ as per Rule 55 of the General Financial Rules, 2017?
- A) Comptroller and Auditor General
- B) Parliament
- C) Finance Ministry
- D) Reserve Bank of India
Show Answer
Correct Answer: C) Finance Ministry
5. Rule 55 of the General Financial Rules, 2017, states that a ‘Vote on Account’ is needed when the Appropriation Bill is likely to be passed after what event?
- A) The end of the financial year.
- B) The start of the financial year.
- C) The presentation of the budget.
- D) The approval of the Finance Committee.
Show Answer
Correct Answer: B) The start of the financial year.
Frequently Asked Questions
What is a ‘Vote on Account’ as per Rule 55 of the General Financial Rules, 2017?
A ‘Vote on Account’ is a temporary authorization by Parliament to the government to draw funds from the Consolidated Fund of India to meet essential expenditure for a brief period, typically a few months, when the full Appropriation Bill for the financial year is not yet passed.
Can funds from a ‘Vote on Account’ be used for new projects under Rule 55 of the General Financial Rules, 2017?
No, Rule 55 explicitly states that funds made available under a ‘Vote on Account’ are not to be utilized for expenditure on a ‘New Service’. They are meant only for existing services and ongoing commitments.
Why is a ‘Vote on Account’ necessary according to Rule 55 of the General Financial Rules, 2017?
It is necessary to ensure the continuity of government operations and essential services at the beginning of a new financial year, especially if the parliamentary process for passing the main Appropriation Bill (which authorizes the full budget) is delayed.
Key Takeaways
- Rule 55 enables temporary government expenditure when the full budget is delayed.
- It is authorized by the Finance Ministry under Article 116 of the Constitution.
- Funds are strictly for existing services, not for ‘New Service’ initiatives.
- Ensures continuity of essential government functions.
Conclusion
Rule 55 of the General Financial Rules, 2017, serves as a vital safeguard for the continuity of government functions. By providing a mechanism for temporary expenditure authorization, it ensures that essential services are not disrupted due to delays in the full budget approval process, while simultaneously imposing strict controls against initiating new financial commitments.