CAG appreciates Modi Govt’s fiscal transparency and accountability

The Comptroller and Auditor General(CAG) of India has appreciated Chief Minister Narendra Modi led Gujarat Government’s efforts for improving fiscal transparency and accountability in state.

The CAG in its recently published report, “STATE FINANCES”, for the year ended on 31st March 2010 has observed in it’s key observations that,”in response to twelfth Finance Commission’s recommendation’s the Gujarat Government enacted its Fiscal Responsibilities and Budget Management (FRBM) Act, entitled the Gujarat Fiscal Responsibility Act, 2005 with a view to ensure prudence in fiscal management and fiscal stability by progressive elimination of revenue deficit, sustainable debt management consistent with fiscal stability, greater transparency in fiscal operations of the Government and conduct of fiscal policy in a
medium term fiscal framework.The State Government’s commitment to carry forward these reforms is largely reflected in the policy initiatives announced in its subsequent budgets. The benefits of FRBM legislation have been realised to a great extent already, in terms of reduction in major deficit indicators.”

The CAG further appreciating the state Government’s efforts noted, “the State Government has done well in establishing an institutional mechanism on fiscal transparency and accountability as evident from the year on year presentation of outcome budgets. These outcome indicators tend to serve the limited purpose of measuring the department-wise performances against the targets. They do not, however, give the big picture of the status of financial management including debt position, off budget liabilities, cash management etc. for the benefit of the State Legislature and other stakeholders.”