Fiscal rectitude at the Centre will finally be a reality with Finance and Company Affairs Minister Jaswant Singh set to push the Fiscal Responsibility and Budget Management Bill in the Budget session of Parliament.
According to finance ministry officials, the last hurdle of a clearance from the law ministry has been crossed.
The Bill, after its introduction in Lok Sabha by former Finance Minister Yashwant Sinha in December 2000, was immediately referred to the standing committee on finance.
Officials said it was possible that Singh might not toe the standing committee recommendations that had called for a substantial dilution of the Bill by relegating the stringent provisions of quantifiable reduction in fiscal and revenue deficits to the rules.
Singh might want the Bill to retain its original sting by pushing for compulsory reductions in deficits.
The standing committee had in its report said the Bill neither made the finance minister accountable for any slip in the targets set nor elaborated on the course of action to be taken if the Centre did not stick to the regimen. Moreover, it bound all future governments to adopt a strict fiscal stance.
The Bill as introduced in Parliament, envisaged reducing the fiscal deficit to 2 per cent of the gross domestic product by 2005-06.
The revenue deficit was to be wiped off altogether during the period and the total public debt of the Centre was to be reduced to 50 per cent of the gross domestic product by 2010.
The minister had reined in the Opposition and ensured that nine crucial economic Bills, including those on securitisation and reconstruction of financial assets, UTI repeal, Sebi amendment, competition and companies amendment, were passed by the two houses of Parliament during the winter session.
Two vital Bills, apart from the Fiscal Responsibility and Budget Management Bill, which are still pending in Parliament, include Banking Companies (Acquisition and Transfer of Undertaking) and Financial Institutions Laws (Amendment) Bill and Government Securities Bill.