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Consider the following statements regarding Off-budget financing.
1. Off-budget spending is not included in the estimation of economic metrics, such as the fiscal deficit.
2. Parliamentary control on such spending is also reduced.
3. National Small Savings Fund is the biggest source for the Government for Off-budget financing.
1. Off-budget spending is not included in the estimation of economic metrics, such as the fiscal deficit.
2. Parliamentary control on such spending is also reduced.
3. National Small Savings Fund is the biggest source for the Government for Off-budget financing.
Which of the above statements is/are correct?
- a)1 and 2 only
- b)1 and 3 only
- c)2 and 3 only
- d)1, 2, 3
Correct answer is option 'D'. Can you explain this answer?
Most Upvoted Answer
Consider the following statements regarding Off-budget financing.1.Off...
Understanding Off-Budget Financing
Off-budget financing refers to expenditures that are not included in the official budget documents. This mechanism can significantly impact a country's fiscal management.
1. Non-Inclusion in Economic Metrics
- Off-budget spending is often excluded from calculations of fiscal deficit and other economic metrics.
- This non-inclusion can lead to a misleading representation of the government’s financial health.
2. Reduced Parliamentary Control
- Since off-budget expenditures are not part of the regular budget, parliamentary oversight is diminished.
- This lack of scrutiny raises concerns about transparency and accountability in government spending.
3. Role of the National Small Savings Fund
- The National Small Savings Fund (NSSF) is indeed one of the primary sources for off-budget financing.
- It allows the government to access funds without impacting the fiscal deficit directly, as these funds are not reflected in the main budget.
Conclusion
All three statements regarding off-budget financing are accurate:
- Off-budget spending is excluded from fiscal deficit calculations.
- Parliamentary control over such expenditures is indeed reduced.
- The NSSF serves as a significant source for off-budget financing.
Therefore, the correct answer is option 'D' (1, 2, 3). Understanding off-budget financing is crucial for comprehending the broader fiscal landscape and the implications for governance and economic policy.
Off-budget financing refers to expenditures that are not included in the official budget documents. This mechanism can significantly impact a country's fiscal management.
1. Non-Inclusion in Economic Metrics
- Off-budget spending is often excluded from calculations of fiscal deficit and other economic metrics.
- This non-inclusion can lead to a misleading representation of the government’s financial health.
2. Reduced Parliamentary Control
- Since off-budget expenditures are not part of the regular budget, parliamentary oversight is diminished.
- This lack of scrutiny raises concerns about transparency and accountability in government spending.
3. Role of the National Small Savings Fund
- The National Small Savings Fund (NSSF) is indeed one of the primary sources for off-budget financing.
- It allows the government to access funds without impacting the fiscal deficit directly, as these funds are not reflected in the main budget.
Conclusion
All three statements regarding off-budget financing are accurate:
- Off-budget spending is excluded from fiscal deficit calculations.
- Parliamentary control over such expenditures is indeed reduced.
- The NSSF serves as a significant source for off-budget financing.
Therefore, the correct answer is option 'D' (1, 2, 3). Understanding off-budget financing is crucial for comprehending the broader fiscal landscape and the implications for governance and economic policy.
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Consider the following statements regarding Off-budget financing.1.Off...
- Off-budget financing by its nature isn't taken into account when calculating fiscal indicators. This refers to expenditure that's not funded through the budget.
- Off-budget financing by its nature isn't taken into account when calculating fiscal indicators. But the cost is borne by the budget through some mechanism or the other. Such financing tends to hide the actual extent of government spending, borrowings and debt and increase the interest burden.
- The government's began harnessing funds from outside the Budget to service its Budget commitments since 2016-17. The size of this initiative has grown more than two-fold in a few years, and now nears 1% of grossdomestic product. What began with food security, off-Budget financing now caters heavily to a range of core spending areas.
- Off-Budget spending may remain high, or rise, in 2021-22. The reason: theNational Small Savings Fund, which is the biggest source for such spending, is growing faster than ever this year. In a year when average incomes have not grown much, people have poured money into savings for social security.
REVENUE SPENDING:
- Deferred fertilizer arrears/bills through special banking arrangements
- Food subsidy bills/arrears of Food Corp. of India through borrowings.
- Accelerated Irrigation Benefit Program through National Bank for Agriculture and Rural Development borrowing
CAPITAL SPENDING
- Indian Railway Finance Corp. borrowing for railway projects
- Power Finance Corp funding of power projects
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Consider the following statements regarding Off-budget financing.1.Off-budget spending is not included in the estimation of economic metrics, such as the fiscal deficit.2.Parliamentary control on such spending is also reduced.3.National Small Savings Fund is the biggest source for the Government for Off-budget financing.Which of the above statements is/are correct?a)1 and 2 onlyb)1 and 3 onlyc)2 and 3 onlyd)1, 2, 3Correct answer is option 'D'. Can you explain this answer?
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Consider the following statements regarding Off-budget financing.1.Off-budget spending is not included in the estimation of economic metrics, such as the fiscal deficit.2.Parliamentary control on such spending is also reduced.3.National Small Savings Fund is the biggest source for the Government for Off-budget financing.Which of the above statements is/are correct?a)1 and 2 onlyb)1 and 3 onlyc)2 and 3 onlyd)1, 2, 3Correct answer is option 'D'. Can you explain this answer? for UPSC 2025 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about Consider the following statements regarding Off-budget financing.1.Off-budget spending is not included in the estimation of economic metrics, such as the fiscal deficit.2.Parliamentary control on such spending is also reduced.3.National Small Savings Fund is the biggest source for the Government for Off-budget financing.Which of the above statements is/are correct?a)1 and 2 onlyb)1 and 3 onlyc)2 and 3 onlyd)1, 2, 3Correct answer is option 'D'. Can you explain this answer? covers all topics & solutions for UPSC 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Consider the following statements regarding Off-budget financing.1.Off-budget spending is not included in the estimation of economic metrics, such as the fiscal deficit.2.Parliamentary control on such spending is also reduced.3.National Small Savings Fund is the biggest source for the Government for Off-budget financing.Which of the above statements is/are correct?a)1 and 2 onlyb)1 and 3 onlyc)2 and 3 onlyd)1, 2, 3Correct answer is option 'D'. Can you explain this answer?.
Consider the following statements regarding Off-budget financing.1.Off-budget spending is not included in the estimation of economic metrics, such as the fiscal deficit.2.Parliamentary control on such spending is also reduced.3.National Small Savings Fund is the biggest source for the Government for Off-budget financing.Which of the above statements is/are correct?a)1 and 2 onlyb)1 and 3 onlyc)2 and 3 onlyd)1, 2, 3Correct answer is option 'D'. Can you explain this answer? for UPSC 2025 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about Consider the following statements regarding Off-budget financing.1.Off-budget spending is not included in the estimation of economic metrics, such as the fiscal deficit.2.Parliamentary control on such spending is also reduced.3.National Small Savings Fund is the biggest source for the Government for Off-budget financing.Which of the above statements is/are correct?a)1 and 2 onlyb)1 and 3 onlyc)2 and 3 onlyd)1, 2, 3Correct answer is option 'D'. Can you explain this answer? covers all topics & solutions for UPSC 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Consider the following statements regarding Off-budget financing.1.Off-budget spending is not included in the estimation of economic metrics, such as the fiscal deficit.2.Parliamentary control on such spending is also reduced.3.National Small Savings Fund is the biggest source for the Government for Off-budget financing.Which of the above statements is/are correct?a)1 and 2 onlyb)1 and 3 onlyc)2 and 3 onlyd)1, 2, 3Correct answer is option 'D'. Can you explain this answer?.
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Consider the following statements regarding Off-budget financing.1.Off-budget spending is not included in the estimation of economic metrics, such as the fiscal deficit.2.Parliamentary control on such spending is also reduced.3.National Small Savings Fund is the biggest source for the Government for Off-budget financing.Which of the above statements is/are correct?a)1 and 2 onlyb)1 and 3 onlyc)2 and 3 onlyd)1, 2, 3Correct answer is option 'D'. Can you explain this answer?, a detailed solution for Consider the following statements regarding Off-budget financing.1.Off-budget spending is not included in the estimation of economic metrics, such as the fiscal deficit.2.Parliamentary control on such spending is also reduced.3.National Small Savings Fund is the biggest source for the Government for Off-budget financing.Which of the above statements is/are correct?a)1 and 2 onlyb)1 and 3 onlyc)2 and 3 onlyd)1, 2, 3Correct answer is option 'D'. Can you explain this answer? has been provided alongside types of Consider the following statements regarding Off-budget financing.1.Off-budget spending is not included in the estimation of economic metrics, such as the fiscal deficit.2.Parliamentary control on such spending is also reduced.3.National Small Savings Fund is the biggest source for the Government for Off-budget financing.Which of the above statements is/are correct?a)1 and 2 onlyb)1 and 3 onlyc)2 and 3 onlyd)1, 2, 3Correct answer is option 'D'. Can you explain this answer? theory, EduRev gives you an
ample number of questions to practice Consider the following statements regarding Off-budget financing.1.Off-budget spending is not included in the estimation of economic metrics, such as the fiscal deficit.2.Parliamentary control on such spending is also reduced.3.National Small Savings Fund is the biggest source for the Government for Off-budget financing.Which of the above statements is/are correct?a)1 and 2 onlyb)1 and 3 onlyc)2 and 3 onlyd)1, 2, 3Correct answer is option 'D'. Can you explain this answer? tests, examples and also practice UPSC tests.
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