What is the issue?
Establishing a Parliamentary Budget Office (PBO) would help MPs provide effective oversight of budgeting.
What is Parliamentary Budget Office?
- A PBO is an independent and impartial body linked directly to Parliament.
- It provides technical and objective analysis of Budgets and public finance to the House and its committees.
- It can generate quality public debate on Budget policy and public finance, enabling parliamentarians to engage meaningfully in the Budget process.
- Traditionally, independent budgetary units are more common in developed countries.
What is the need for such office?
- Multiple indicators suggest that executive-led budgetary governance has not been successful in India.
- The Indian Parliament is a Budget-approving body contributing to budgetary matters in the following notable ways:
- Presentation of the Budget.
- Scrutiny of the demands for grants of various ministries.
- Debate.
- Consideration and approval of the Budget.
- To carry out these functions effectively, Parliament requires institutional, analytical and technical competence.
- There is a growing trend among legislatures, particularly within the OECD countries to establish specialised Budget research units.
What are the functioning roles of PBO?
- The majority of PBOs have four core functions:
- Independent and objective economic forecast.
- Budgets generally start with an economic forecast.
- A PBO can present either its own independent forecast or it can validate the government’s, providing an objective analysis on the official forecast.
- Baseline estimate survey.
- It will provide options for spending cuts, outlining a budgetary framework that reflects priorities of the nation, bespoke policy briefs.
- Analysing the executive’s Budget proposal.
- A PBO is comprised of independent and specialised staff, such as Budget analysts, economists, and public finance experts.
- These may include general economic analysis, tax analysis, long-term analysis.
- Providing medium- to long-term analysis.
- Its output, and the methods by which those outputs are prepared, must be transparent, accessible and understandable.
Source: The Hindu
