Annexure II - EFC & SFC | KartavyaDesk
Original Rule Text
Expenditure Finance Committee (EFC) Expenditure Secretary Chairperson Secretary of the Administrative Ministry/Department Member Financial Advisor of the Administrative Ministry/ Department Member Adviser, PAMD, NITI Aayog Member Representative of Budget Division Member Representative of concerned Ministries/Agencies Member Joint Secretary, Department of Expenditure Member-Secretary For appraisal of schemes of scientific nature, Scientific Adviser may be invited as Member. Standing Finance Committee (SFC) Secretary of the Administrative Ministry/Department Chairperson Joint Secretary in Charge of the Subject Division Member Representative of NITI Aayog Member Financial Advisor of the Administrative Ministry/ Department Member-Secretary Representative of Department of Expenditure and any other Ministry/Department that the Secretary/Financial Advisor may suggest may be invited as per requirement.
What This Means
Annexure II of the Delegation of Financial Powers Rules, 1978, outlines the composition and function of two important committees: the Expenditure Finance Committee (EFC) and the Standing Finance Committee (SFC). These committees play a crucial role in scrutinizing and approving government expenditure proposals before they are implemented. Think of them as gatekeepers ensuring that public funds are spent wisely and in accordance with established procedures.
The EFC is generally involved in appraising larger, more significant projects, especially those of a scientific nature. The SFC, on the other hand, typically deals with smaller projects and recurring expenditures. Both committees include representatives from various ministries and departments, including the administrative ministry proposing the expenditure, the Department of Expenditure (Ministry of Finance), and NITI Aayog. The specific members and the chairperson vary depending on the committee, as detailed in the rule. These rules affect all government departments and agencies that require financial approvals for their projects and schemes.
Understanding the composition and functions of the EFC and SFC is essential for government employees involved in project planning, budgeting, and financial management. It ensures that proposals are prepared correctly and submitted to the appropriate committee for approval, streamlining the process and avoiding delays.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- •Annexure II defines the composition of the Expenditure Finance Committee (EFC) and the Standing Finance Committee (SFC).
- •The EFC appraises larger, significant projects, especially those with a scientific component.
- •The SFC handles smaller projects and recurring expenditures.
- •Both committees include representatives from various ministries, including the Department of Expenditure and NITI Aayog.
- •The Secretary of the Administrative Ministry chairs the SFC, while the Expenditure Secretary chairs the EFC.
Practical Example
The Ministry of Rural Development proposes a new rural road construction project costing ₹500 crore. Since the project involves a significant expenditure, it needs to be appraised by the Expenditure Finance Committee (EFC). The Secretary of the Department of Expenditure chairs the EFC meeting. Members present include the Secretary of the Ministry of Rural Development, the Financial Advisor of the Ministry of Rural Development, an Advisor from PAMD, NITI Aayog, a representative from the Budget Division, and a Joint Secretary from the Department of Expenditure who acts as the Member-Secretary. After a thorough review, the EFC recommends the project for approval, subject to certain modifications in the project design to reduce costs. Had the project been a smaller, recurring expense like annual maintenance of existing roads costing ₹5 crore, it would have been reviewed by the Standing Finance Committee (SFC) chaired by the Secretary of the Ministry of Rural Development.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Frequently Asked Questions
What is the main difference between the EFC and the SFC?▼
Who chairs the Expenditure Finance Committee (EFC)?▼
Who chairs the Standing Finance Committee (SFC)?▼
What is the role of the Financial Advisor in these committees?▼
Can other ministries be invited to the SFC meeting?▼
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Test Your Knowledge
Question 1 of 3
Who chairs the Expenditure Finance Committee (EFC) as per Annexure II of the Delegation of Financial Powers Rules, 1978?
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