Overview of Supplementary Demands for Grants (SDG)

  • November 27, 2023
  • Posted by: OptimizeIAS Team
  • Category: DPN Topics
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Overview of Supplementary Demands for Grants (SDG)

Subject : Polity

Section: Parliament

  1. Likely Allocations:
    • Additional allocation for fertilizer, food, fuel subsidy, and Rural Employment Guarantee Scheme expected in SDG.
    • Winter Session of Parliament (starting December 4) to witness SDG presentation.
  2. Funding Sources:
    • Some funds allocated for subsidy and rural employment through the contingency fund, subject to parliamentary regularization.
    • Anticipation of additional allocation through SDG, but not a significant fresh cash outflow expected.
  3. Increase in Expenses:
    • FY 24 Budget size exceeds ₹45 lakh crore, with over 47% spent in April-September.
    • Significant increase in capital expenditure; revenue expenditure on Fertilizer Subsidy and Urea Subsidy already high.
    • Cabinet approved over ₹22,000 crore additional expenditure, likely provisioned through SDG.
  4. Potential Areas for Additional Allocation:
    • Petroleum subsidy may exceed budgeted ₹2,257 crore due to additional Ujjwala LPG scheme connections and increased subsidy for Ujjawala customers.
    • Demand for assistance from oil marketing companies facing a ₹200 price cut on each domestic LPG cylinder.
    • Possible allocation for the free food grains scheme.
    • Expected need for more funds for the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS).

Supplementary Demands for Grants: Overview

  1. Definition:
    • Supplementary Demands for Grants are necessary for government expenditure beyond the amount approved during the Budget session.
  1.   Constitutional Provisions:
  • Article 115:
    • Pertains to supplementary, additional, or excess grants.
  • Article 116:
    • Pertains to Votes on Account, Votes of Credit, and exceptional grants.
  • Articles 115 and 116 cover Supplementary, Additional, or Excess Grants, and Votes on Account, Votes of Credit, and Exceptional Grants, respectively.
  1. Procedure:
    • When approved grants fall short, an estimate for Supplementary or Additional grants is presented to and passed by Parliament before the fiscal year-end.
    • If actual expenditure exceeds approved grants, the Ministry of Finance presents a Demand for Excess Grant.
    • The Comptroller and Auditor General of India highlights excesses to Parliament.
    • The Public Accounts Committee reviews excesses and provides recommendations.
    • Demand for Excess Grants is presented after the fiscal year-end.

Other Types of Grants:

  • Additional Grant:
    • Granted for additional expenditure on a new service not in the budget for the current fiscal year.
  • Excess Grant:
    • Granted when spending on any service exceeds the allocated budget amount.
    • Voted by Lok Sabha after the fiscal year, following approval by the Public Accounts Committee.
  • Vote of Credit:
    • Granted to meet an unexpected demand on India’s resources with no specific details.
    • Functions like a blank cheque given by Lok Sabha to the Executive.
  • Exceptional Grant:
    • Granted for a special purpose unrelated to the current service of any fiscal year.
  • Token Grant:
    • Granted when funds for new service expenditure can be made available by reappropriation.
    • A token sum (Re 1) demand is submitted to Lok Sabha; if approved, funds become available.
    • Reappropriation involves transferring funds between budget heads without additional expenditure.

Nutrient-Based Fertilizer Subsidy:

  • A subsidy provided for fertilizers based on their nutrient content rather than a flat subsidy for all fertilizers.
  • Intended to promote balanced use of fertilizers and improve soil fertility.
  • Implementation:
    • The subsidy is calculated based on the nutrient content of the fertilizers, such as nitrogen, phosphorus, and potassium.
    • Farmers receive subsidies to make fertilizers more affordable and encourage judicious use.

Urea Subsidy:

  • Urea is a crucial nitrogenous fertilizer.
  • Urea subsidy involves financial support to ensure its availability at an affordable price for farmers.
  • Implementation:
    • The government provides a subsidy to fertilizer manufacturers, making urea accessible to farmers at lower prices.
    • Aims to support agricultural productivity and address farmers’ concerns about fertilizer costs.

Mahatma Gandhi National Rural Employment Guarantee Act (NREGA):

  • Objective:
    • Guaranteeing at least 100 days of wage employment in rural areas to every household whose adult members volunteer to do unskilled manual work.
  • Implementation:
    • Provides a social safety net by ensuring livelihood security.
    • Focuses on sustainable development through the creation of productive assets in rural areas.

Ujjwala LPG Scheme:

  • Objective:
    • To provide clean cooking fuel (LPG) to women from Below Poverty Line (BPL) households.
  • Implementation:
    • Subsidized LPG connections are provided to eligible BPL women.
    • Aims to reduce indoor air pollution, health risks, and time spent on collecting traditional fuels.
Overview of Supplementary Demands for Grants (SDG) Polity