Railway Accounts Department Examinations

Showing posts with label Parliamentary control. Show all posts
Showing posts with label Parliamentary control. Show all posts

Sunday, January 17, 2021

Parliamentary control over Railway finances


Parliamentary control over Railway finances


Key to Remember  -  PQR   DANCER   CCC



Q - Questions asked in Parliament



D - Discussions on urgent matters in Parliament

A - Annual Budget


C - Cut Motions

E - Estimates Committee

R - References from MPs


C - Committee on Subordinate Legislation

C - Committee on Govt Assurances

C - Committee System - Referring a particular matter to the Committees

1.    Annual Budget

2.    Estimates committee

3.    Committee on subordinate legislation

4.    NRUCC

5.    Committee on Government assurances

6.    PAC

7.    RCC

8.    References from Members of Parliament

9.    Committee system - Referring a matter (of Railways) to the committee of Parliament Members

10.  Cut Motions

11.  Questions in the Lok Sabha & the Rajya Sabha A) Starred B) Unstarred C) Short Notice

12.  Discussion on urgent matters through Adjournment Motion or Calling Attention notice


1.    Annual Budgetary exercise



     Under Article   112   of the  Constitution, A statement of the estimated annual receipts and expenditure whether on the Capital segment or on Revenue segment of the Railways,   commonly known as the ' Budget',  is laid before   both  the   Houses   of Parliament   by Finance Minister.

     The proposed expenditure included in the Budget may be—(i) Voted, or (ii) Charged.

      Parliament has the power to assent, or to refuse to assent, to any demand or to assent to any demand subject to a reduction of the amount.  (Cut Motions)

      If the amount of a grant/appropriation in the budget is found to be insufficient for the purpose of the current year, an estimate for supplementary grant /appropriation,  is submitted by the Railway Board to the vote of the Parliament/ sanction of the President.

     Excess Grants relate to expenditure already incurred, for  reasons to be fully explained, in excess of the grant voted by Parliament.  The demand for an excess grant is based on the recommendations of the Public Accounts Committee as a result of their scrutiny of the Appropriation Accounts of the Railways and the Audit Report of the Comptroller and Auditor General.  Excess grants have to be presented after obtaining the recommendation of the President.

     Budget allotment: The  grants  as  voted  by  the  Parliament  and the  appropriation  for  the  charged  expenditure  as sanctioned  by  the  President,  are  distributed  by the Railway  Board  among  the  railway administrations and other authorities subordinate  to  them,  as  soon  as  possible  after the Budget  is sanctioned.

      The  allotments  made  out  of  funds voted  by  the  Parliament  are  shown  as  ‘Voted’ and  those  fixed  by  the  President  are  shown  as ‘Charged’.

     Budget Orders: The orders by means of which the allotments are communicated are called "Budget Orders".

     In the event of the Budget Orders of the Railway Board not being received before the commencement of the financial year, the railway administrations are empowered to incur expenditure on works which were in progress at the end of the previous financial year.  All expenditure incurred under this rule must be treated as a charge against the allotments eventually made for such works.

      When the Budget Orders issued by the Railway Board show any reduction in the estimates originally submitted to them, prompt measures should be taken by the railway administrations to limit the expenditure to the amounts allotted by the Railway Board.

      Budget is operative  until  the  close  of  the financial  year.  Under  the  ‘doctrine  of  lapse’,  any unspent  balance  shall  lapse  and   not  be available for utilization  in the  following  year.


2.    Estimates Committee:


      Consists of 30 Members - all elected from Lok Sabha only

     Term - One year

      The members are elected every year from amongst its members of the Lok Sabha, according to the principle of proportional representation by means of single transferable vote. The chairperson is appointed by the Lok Sabha speaker

      A minister is not eligible to become a member of the committee. In case a member after his election to the committee becomes a minister, he or she ceases to be a member from the date of such appointment.

     Scrutinizing the functioning of Government ministries/departments including Indian Railways in terms of the expenditure and utilization of funds.

     Suggests alternative policies in order to bring about efficiency and economy in administration.

     It also examines whether the finances are laid out within the limits of the policy implied in the estimates and also to suggest the form in which the estimates shall be presented to Parliament

      It is a financial standing committee (PAC too)

      The committee from time to time selects the estimates pertaining to a ministry or department of the central government or such of the statutory and other bodies of the central government as may seem fit to the committee.



3.    Committee on Subordinate Legislation:


      scrutinizes and reports to the House to know whether the powers are making regulations, rules, sub -rules, by-laws etc. conferred by the constitution or delegated by the parliament are being properly exercised by the executive within the scope of such delegation.

       Consists of 15 Members from both the Houses. (Separate committees)

      Term: One year


4.    NRUCC


     National Level -  NRUCC - National Railway Users Consultative Council


     Zonal  Level - ZRUCC - Zonal Railway Users Consultative Committee


     Divisional level - DRUCC - Divisional Railway Users Consultative Committee


     All the Committees and Council established under these rules are consultative in character.


     Questions relating to staff, discipline and appointment should not be brought before the Committees or the Council.


     Afforded reasonable facilities like Free passes for  travel and Travelling allowance to all Non official members for attending committee meetings or any other work of the committee.




A.    Securing better representation of Railway users.


B.     Affording more frequent opportunities for consultation between Railways and Users on matters relating to service.

C.     Improving the passenger services.




1.    Provision of amenities


2.    Opening of New stations


3.    Improvement of Passenger services and facilities


     Members - From Chamber of Commerce, Trade Associations,  Industries Association, Agriculture Association, Handicapped  Association, Registered Passengers association, Consumer  Protection Organisation, MLAs, MPs , Railway Officials etc







Full form

National Railway Users Consultative Council

Zonal Railway Users Consultative Committee

Divisional Railway Users Consultative Committee


Minister for Railways




Director, Traffic Commercial (General) II

Secretary to GM or any other officer nominated by GM

Sr.Traffic Officer (Sr.DOM /Sr.DCM)


2 years

2 years

2 years

Tenure commenced from




No of times - Meet

2 times

3 times

Not less than 3 times



5.    Committee on Government Assurances


     scrutinizes the assurances, promises, undertakings etc. given by ministers from time to time;

     and to report to the respective house and to see whether such implementation has taken place within the minimum time necessary for the purpose.

     Consists of 15 members in Lok Sabha.

     Term - 1 Year

     Chairman is appointed by the Speaker of the Lok Sabha. However, if the Deputy Speaker is a Member of the Committee, he shall be appointed Chairman of the Committee.


6.      PAC


      Shortly or popularly called as PAC.

     It is one of the Standing Parliamentary committees in India. Hence it is under the control of Speaker of Lok Sabha.

       The term of office of PAC members is one year only.

      Total Members should not be more than 22.  (15 Members were from Lok Sabha and 7 Members were from Rajya Sabha) 

       None of the above members shall be a Minister of Government.  If a Member after his election to the PAC is appointed a Minister, he ceases to be a member of the Committee. 

       The Chairman of PAC is appointed by the Speaker amongst its members of Lok Sabha. Since 1967, the Chairman of the PAC has been a member of Opposition.  This practice has been continued since then, though it is not mandatory.


Functions of PAC


     Examination of the Appropriation Accounts relating to Railways, Defense Services, P & T Dept and other civil ministries of Central Government.


     Examination of Reports of CAG on the above Appropriation Accounts.


     Examination of CAG Report on Revenue Receipts of Government of India.


     That the money shown in the Appropriation accounts as having been disbursed were legally available for and, applicable to the service or purpose to which they have been applied or charged.


     That the expenditure conforms to the authority which governs it.


     That every re-appropriation has been made in accordance with the provisions made in this behalf under rules framed by competent authority.


       Normally all the recommendations of the PAC are implemented by the Government.


Working of the PAC:


       The representatives of the Ministries like Railways, Defense etc appear before the PAC when examining the Accounts and Audit (CAG) reports relating to their ministries.


        The committee proceeds by way of INTERROGATION of witnesses.  The CAG is the "friend, philosopher and guide of the PAC" while attends the sittings of the Committee and assists it in its deliberations.


       The Committee may appoint one or more Sub-Committees/groups to examine any particular matter.



Govt's Action on PAC recommendations:


       Stages  are  1. Action taken Notes 2.  Action taken Report 3. Action taken Statement.


  1. Action taken Notes:  Govt take action on the recommendations of the PAC and submit ACTION TAKEN NOTES to the Committee.

  2.Action taken Report:  The PAC then presents ACTION TAKEN REPORT after considering the views of Government.

3. Action taken statement:  The Government further submit an Action TAKEN STATEMENT on the action taken by the Government on the Action Taken Report of the committee.  Action taken Statement is generally laid before the House without any further examination by the PAC.


       Normally, almost all the recommendations of the Committee are implemented by the Government.


7.      RCC

       is an ad hoc Parliamentary committee constituted from time to time on Resolution adopted by Lok Sabha and concurred in by Rajya Sabha.


       Þ       The appointment and functions of Railway Convention Committee is a part of Parliamentary control over Indian Railway Finances.


       Þ       Composition of RCC - 12 members from Lok Sabha nominated by Speaker and 6 Members from Rajya Sabha nominated by Chairman.


       Þ       The Chairman of the Committee is appointed by the Speaker from amongst the members of the Committee.



       Þ       After Independence, first RCC constituted in the year 1949. Since then, each Lok Sabha has been having a Railway Convention Committee.


       Þ        The Committee becomes functus officio after presenting its final Report regarding rate of dividend payable to General Revenues.


       Þ       The Report of the Committee on the Rate of Dividend is considered by the House on a Resolution moved by the Minister of Railways.


       Þ       After a Report has been presented to the House, the Ministry of Railways and other concerned Ministries are required to take action on various observations and recommendations contained in the Report. The replies of the Government are examined and an ATR- Action Taken Report is then presented to the House.


       Þ       is formed once in five years (normally with the formation of New Loksabha)


       Þ       Its rules generally applicable for a period of five years.



R C C recommends on the following aspects:


ü Rate of Dividend payable to the General Revenues. (This may not require now, due to merger of Railway Budget with General Budget)


ü Appropriation to the D.R.F.


ü Modification of rules of expenditure allocation between Capital and Revenue.


ü How Rly Surplus (after the payment of Dividend) should be distributed among various Railway Funds.


ü To introduce flexibility in the administration of the Railway finances.


ü Accounting matters and aspects of Management practices on Railways.


ü Express views on Rolling Stock Production and any short earnings and how the same should be overcome.



ü And any other subject matter brought to its notice by the Minister of Railways.





8.    References from Members of Parliament




9.    Committee system - Referring a matter (of Railways) to the committee of Parliament Members



10.   Cut Motions

     Part of Parliamentary control over Railway Finances.


     A special power vested in Members of Lok Sabha to reduce any Demand for Grant


    Exercised while discussing the Demands for Grants


     Consequence:  If the Cut Motion is adopted, it amounts to no-confidence Vote. If the Govt fails to jot up the numbers in Lok Sabha, it is obliged to resign according to the norms of House.


     The decision to accept a Cut Motion relies solely on the Speaker of the Lok Sabha as per Rules in force.


     Members can also table notices in electronic form through e-portal specially developed for the purpose.




1.    Disapproval of Policy Cut: Demand is reduced to Rupee One.


2.    Economic Cut: Reduction of Demand for Grant to a specific amount.


3.    Token Cut: The amount of the Demand is reduced by just Rs. 100. This is to ventilate the specific grievance /displeasure.




Type of Cut

Demand for Grant proposed

Amount of


Demand for

Grant passed



Policy Cut

Rs. 1,00,000

Rs. 99,999

Re 1

Here agreeing the

amount always Re 1 only.

Economic Cut

Rs. 1,00,000

Rs. 30,000

Rs. 70,000

Any amount of cut.

 That is either Rs. 30,000

 or any specific amount

within Rs. 1,00,000

Token Cut

Rs. 1,00,000

Rs. 100

Rs. 99,900

Here, the amount of cut

 always Rs. 100 being Token.


11.  Questions in the Lok Sabha & the Rajya Sabha


     Any Member of Parliament may ask a question  for the purpose of obtaining information on a matter of public importance.


      Starred Questions -A Starred Question is one to which a member desires an oral answer from the Minister in the House and is required to be distinguished by him/her with an asterisk. Answers to such a question may be followed by supplementary questions by members.


     Unstarred Questions- An Unstarred Question is one to which a written answer is desired by the member and is deemed to be laid on the Table of the House by the Minister. Thus it is not called for oral answer in the House and no supplementary question can be asked thereon.


     Short Notice Questions- A member may give a notice of question on a matter of public importance and of urgent character for oral answer at a notice less than 10 days prescribed as the minimum period of notice for asking a question in ordinary course. Such a question is known as ‘Short Notice Question’.


12.   Discussion on a definite   matter of urgent public  importance may be sought by a Member through an Adjournment Motion or a Calling Attention Notice.









Total Members

Lok Sabha

Rajya Sabha

Type of



















Ad hoc

Subordinate Legislations





Standing -

Separate committees

Govt Assurances





Separate committees