Spending limits or Working Budget Grant
Limiting the Revenue Grant to certain extent, say 90% or 95% by keeping some amount as Reserve to meet the unforeseen expenditure that may arise during execution of budget, is achieved by fixing SL/WBG.
Example: Budget Grant - Rs.100, Reserve - Rs. 10 and SL/WBG is Rs. 90
Usually this exercise is undertaken by the Railway Board or General Managers, after distribution of Budget Grant (BG). While distributing BG to the units, it will be made clear that this shall be used only for the purpose of budget reviews and not for spending.
After identifying the possible savings in SMH (erstwhile Demand) and PU to the extent indicated by the Board, the same will immediately be communicated as Spending Limit (SL) /Working Budget Grant (WBG) to the units within which expenditure shall be incurred.
The Objective of keeping such a Reserve is to meet emergency needs and ensure austerity measures in the Railways.
Amounts kept in Reserve may be released or distributed to the Spending authorities as part of RG or FG, based on their projections.
If there is no demand for such a Reserve amount, the same may be surrendered during the Budgetary Reviews.
Proportionate Budget Allotments (PBAs) are worked out on both BG and SL/WBG.
However, Monthly Financial Reviews will be carried out wrt SL/WBG.
There are no fixed guidelines/instructions to determine the amount to be kept as reserve. Also it is not mandatory for keeping the reserve always. It is at the discretion of the Railway Board or General Managers at Zonal Level.