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Public Expenditure Management Reform in India via Intergovernmental Transfers
Author(s) -
LALVANI MALA
Publication year - 2010
Publication title -
public budgeting and finance
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.694
H-Index - 30
eISSN - 1540-5850
pISSN - 0275-1100
DOI - 10.1111/j.1540-5850.2010.00964.x
Subject(s) - public expenditure , commission , context (archaeology) , incentive , public finance , economics , public economics , quality (philosophy) , stride , control (management) , finance , business , public administration , political science , macroeconomics , microeconomics , paleontology , philosophy , computer security , management , epistemology , biology , computer science
This paper explores the possibility of using the channel of intergovernmental transfers for Public Expenditure Management reform in India. It seeks to introduce a quantifiable measure of expenditure quality which would influence intergovernmental transfers. The central message of this study is that a Quality Control Fund should be created by the Finance Commission. Inter‐se distribution from this would be in the nature of a reward to the states for their performance in the context of expenditure quality. The funds received from this incentive fund could be tied to spending on education and health. It would be a major change of approach if the Finance Commission mandated the States to set out some realistic output targets which could be monitored (would be reviewed by the next Finance Commission). This would be a big stride toward results‐based output‐oriented transfers and could herald a sea change in the very approach of budgeting and intergovernmental relations in India!