What is a vote on account?

The Congress-led UPA government is seeking vote-on-account in the budget session of Parliament that began on Thursday. Since this will be the final session before coming Lok Sabha elections to be held in April-May, the regular budget for fiscal 2009-10 will be left for the new government. Vote-on-account to meet government's expenditure till the new government takes over will be met from Consolidated Fund of India.

1)     What is a vote-on-account?

It is literally a vote on the accounts of the Government of India. No money can be spent by the government without the Parliament approving it; so after the government presents the accounts of expenditure and income, the Parliament approves it. Only after this does the government gets to spend the money. Generally, a vote-on-account is sought for three months, to be replaced by the regular budget.

2)     So why is the Government presenting a vote-on-account?

In the normal course of budget-making and passing, the Budget is presented on February 28, after which there is a discussion and the details are scrutinized by a Parliamentary committee. It is usually by the middle of May when the actual Budget gets approved and passed. This will be in the middle of the elections, or may even be after a new government is sworn in, depending upon the election schedule. So, since the retiring government can't get the Budget passed, it is getting a vote-on-account. This is also known as an Interim Budget sometimes.

The full budgeting is done from April 1 to March 31. So, the sanction that the government gets from Parliament for spending expires on March 31. But the new Budget gets passed only in mid-May. So, after the Budget is presented on February 28, the government moves a vote-on-account which gets it Parliament's sanction to spend money for another two months or so.