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Rule 62 - Budget Savings & Spending | KartavyaDesk

GFR 2017

Original Rule Text

financial year. 62 (2) The savings as well as provisions that cannot be profitably utilised shall be surrendered to Government immediately, they are foreseen without waiting till the end of the year. No savings shall be held in reserve for possible future excesses. 62 (3) Rush of expenditure, particularly in the closing months of the Financial Year, shall be regarded as a breach of financial propriety and shall be avoided. The Financial Advisers of the Ministries/Departments shall ensure adherence to the stipulated Monthly Expenditure Plan and the guidelines issued in this regard by the Budget Division, Department of Economic Affairs, from time to time. 62 (4) The Financial Advisers of the Ministries/ Departments shall ensure adherence to the stipulated Quarterly Expenditure Plan and the guidelines issued in this regard by Ministry of Finance from time to time. 63 Expenditure on New Service. No expenditure shall be incurred during a financial year on a “New Service” not contemplated in the Annual Budget for the year except after obtaining a supplementary grant or appropriation or an advance from the Contingency Fund during that year. The guidelines to determine cases of “New Service”/ “New Instrument of Service” are contained in Annexure-1 to Appendix -3. 64 (1) Additional Allotment for excess expenditure. A subordinate authority incurring the expenditure shall be responsible for seeing that the allotment placed at its disposal is not exceeded. Where any excess over the allotment is apprehended, the subordinate authority shall obtain additional allotment before incurring the excess expenditure. For this purpose, the authorities incurring expenditure shall maintain a ‘Liability Register’ in Form GFR 3. 64 (2) A Disbursing Officer may not, on his own authority, authorize any payment in excess of the funds placed at his disposal. If the Disbursing Officer is called upon to honour a claim, which is certain to produce an excess over the allotment or appropriation at his disposal, he shall take the orders of the administrative authority to which he is subordinate before authorizing payment of the claim in question. The administrative authority shall then arrange to provide funds either by reappropriation or by obtaining a Supplementary Grant or Appropriation or

What This Means

GFR Rule 62 is all about responsible spending and budget management within the government. It emphasizes the importance of not hoarding funds and promptly returning any savings or unutilized provisions to the government. This means if a department realizes it won't need all the money allocated for a specific project, it should surrender those funds immediately, rather than holding onto them 'just in case.' The rule also strictly discourages a last-minute rush of spending at the end of the financial year, as this often leads to inefficient and potentially wasteful expenditures. Financial Advisors play a crucial role in ensuring that departments stick to their planned spending schedules.

This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.

Key Points

  • •Savings and unutilized provisions must be surrendered immediately to the government.
  • •Holding savings for potential future excesses is prohibited.
  • •A rush of expenditure at the end of the financial year is a breach of financial propriety.
  • •Financial Advisors are responsible for ensuring adherence to Monthly and Quarterly Expenditure Plans.
  • •Expenditure should align with the approved budget and spending plans.

Practical Example

The Ministry of Agriculture received an allocation of ₹5 crore for a farmer training program. By September, after streamlining the program, the project director, Mr. Sharma, realizes that only ₹4 crore will be needed. According to GFR Rule 62, Mr. Sharma must immediately surrender the remaining ₹1 crore to the government. He cannot hold onto the funds hoping to use them for another, unplanned initiative later in the year. Furthermore, the Financial Advisor of the Ministry, Ms. Verma, monitors the expenditure plan to prevent a sudden surge in spending in March to exhaust the budget, ensuring the funds are used efficiently throughout the year.

This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.

Frequently Asked Questions

What happens if we realize we need more money than allocated?▼
GFR Rule 64 addresses this. You need to obtain additional allotment before incurring the excess expenditure. Maintain a 'Liability Register' (Form GFR 3) to track potential overspending.
What is considered a 'rush of expenditure' and why is it bad?▼
A 'rush of expenditure' refers to a sudden increase in spending, especially in the last few months of the financial year. It's considered a breach of financial propriety because it often leads to poorly planned and potentially wasteful spending, as departments scramble to use up their remaining budget.
Who is responsible for ensuring compliance with Rule 62?▼
While all government employees are responsible for adhering to financial rules, the Financial Advisors of Ministries/Departments have a specific responsibility to ensure compliance with Rule 62, particularly regarding adherence to expenditure plans.
What is the purpose of surrendering savings immediately?▼
Surrendering savings allows the government to reallocate those funds to other priority areas or reduce overall borrowing, promoting efficient use of public money.
Does this rule apply to all types of government spending?▼
Yes, GFR Rule 62 applies to all types of government expenditure, ensuring responsible and efficient financial management across all departments and ministries.

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

According to GFR Rule 62, what action should a government department take when it foresees that certain allocated funds will not be profitably utilized?

Related Rules

Rule 271General Financial Rules 2017 (amended July 2024) - Rule 271 - Chapter 10Rule 109General Financial Rules 2017 (amended July 2024) - Rule 109Rule 146General Financial Rules 2017 (amended July 2024) - Rule 146 - Chapter 6Rule 169General Financial Rules 2017 (amended July 2024) - Rule 169 - Chapter 6Rule 215General Financial Rules 2017 (amended July 2024) - Rule 215 - Chapter 6

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