The Haryana Fiscal Responsibility and Budget Management Act, 2005 (6 of 2005)

373
THE  HARYANA  FISCAL  RESPONSIBILITY  AND  BUDGET
MANAGEMENT  ACT,  2005
(Haryana Act No. 6 of 2005)
TABLE  OF  CONTENTS
Sections :
1. Short title and commencement.
2. Definitions.
/g22/g17 /g41/g76/g86/g70/g68/g79/g3/g80/g68/g81/g68/g74/g72/g80/g72/g81/g87/g3/g82/g69/g77/g72/g70/g87/g76/g89/g72/g86/g17
/g23/g17 /g41/g76/g86/g70/g68/g79/g3/g80/g68/g81/g68/g74/g72/g80/g72/g81/g87/g3/g83/g85/g76/g81/g70/g76/g83/g79/g72/g86/g17
/g24/g17 /g41/g76/g86/g70/g68/g79/g3/g83/g82/g79/g76/g70/g92/g3/g86/g87/g68/g87/g72/g80/g72/g81/g87/g86/g3/g87/g82/g3/g69/g72/g3/g79/g68/g76/g71/g3/g69/g72/g73/g82/g85/g72/g3/g87/g75/g72/g3/g54/g87/g68/g87/g72/g3/g47/g72/g74/g76/g86/g79/g68/g87/g88/g85/g72/g17
/g25/g17 /g48/g68/g70/g85/g82/g72/g70/g82/g81/g82/g80/g76/g70/g3/g73/g85/g68/g80/g72/g90/g82/g85/g78/g3/g86/g87/g68/g87/g72/g80/g72/g81/g87/g17
/g26/g17 /g48/g72/g71/g76/g88/g80/g3/g87/g72/g85/g80/g3/g73/g76/g86/g70/g68/g79/g3/g83/g82/g79/g76/g70/g92/g3/g86/g87/g68/g87/g72/g80/g72/g81/g87/g17
/g27/g17 /g41/g76/g86/g70/g68/g79/g3/g83/g82/g79/g76/g70/g92/g3/g86/g87/g85/g68/g87/g72/g74/g92/g3/g86/g87/g68/g87/g72/g80/g72/g81/g87/g17
/g28/g17 /g41/g76/g86/g70/g68/g79/g3/g87/g68/g85/g74/g72/g87/g86/g17
/g20/g19/g17 /g48/g72/g68/g86/g88/g85/g72/g86/g3/g73/g82/g85/g3/g73/g76/g86/g70/g68/g79/g3/g87/g85/g68/g81/g86/g83/g68/g85/g72/g81/g70/g92/g17
/g20/g20/g17 /g48/g72/g68/g86/g88/g85/g72/g86/g3/g87/g82/g3/g72/g81/g73/g82/g85/g70/g72/g3/g70/g82/g80/g83/g79/g76/g68/g81/g70/g72/g17
/g20/g21/g17 /g51/g85/g82/g87/g72/g70/g87/g76/g82/g81/g3/g82/g73/g3/g68/g70/g87/g76/g82/g81/g3/g87/g68/g78/g72/g81/g3/g76/g81/g3/g74/g82/g82/g71/g3/g73/g68/g76/g87/g75/g17
/g20/g22/g17 /g36/g83/g83/g79/g76/g70/g68/g87/g76/g82/g81/g3/g82/g73/g3/g82/g87/g75/g72/g85/g3/g79/g68/g90/g86/g3/g81/g82/g87/g3/g69/g68/g85/g85/g72/g71/g17
/g20/g23/g17 /g51/g82/g90/g72/g85/g3/g87/g82/g3/g85/g72/g80/g82/g89/g72/g3/g71/g76/g73/g73/g76/g70/g88/g79/g87/g76/g72/g86/g17
/g20/g24/g17 /g51/g82/g90/g72/g85/g3/g87/g82/g3/g80/g68/g78/g72/g3/g85/g88/g79/g72/g86/g17
FISCAL  RESPONSIBILITY  AND
BUDGET  MANAGEMENT
2005 : Hr. Act 6]
374
375
1THE  HARYANA  FISCAL  RESPONSIBILITY  AND  BUDGET
MANAGEMENT  ACT,  2005
(Haryana Act No. 6 of 2005)
[Received the assent of Governor of Haryana on the 29th June, 2005, and
was first published for general information in the Haryana Government Gazette
(Extraordinary), Legislative Supplement Part I of the 6th July, 2005.]
Year No. Short title Whether repealed or otherwise
affected by Legislation
  1  2         3           4
2005  6 The Haryana Fiscal Amended by Haryana Act 8
Responsibility and Budget of  2006 2
Management Act, 2005. Amended by Haryana Act 17
of 20093
Amended by Haryana Act 9
of 2010
4
Amended by Haryana Act 5
of 2011
5
Amended by Haryana Act 24
of 20206
AN
ACT
to provide for the responsibility of the State Government to ensure prudence in
fiscal management and fiscal stability by progressive elimination of revenue
deficit, reduction in fiscal deficit, prudent debt management consistent with
fiscal sustainability, greater transparency in fiscal operations of  the
Government  and conduct of fiscal policy in a medium term framework
and for matters connected therewith or incidental thereto.
Be it enacted by the Legislature of the State of Haryana in the Fifty-sixth
Year of the Republic of India as follows: -
1. (1) This Act may be called the Haryana Fiscal Responsibility and
Budget Management Act, 2005.
Short title and
commencement.
1 For Statement of Objects and Reasons, see Haryana Government Gazette (Extraordinary),
dated 09th June 2005, page-2624.
2 For Statement of Objects and Reasons, see Haryana Government Gazette (Extraordinary),
dated 13th December, 2005, page-4659.
3 For Statement of Objects and Reasons, see Haryana Government Gazette (Extraordinary),
dated 30th July, 2009, page-2895.
4. For Statement of objects and Reasons, see Haryana Government Gazette (Extraordinary)
dated 08th March, 2010, page 897.
5. For Statement of objects and Reasons, see Haryana Government Gazette (Extraordinary)
dated 3rd March, 2011, page 775.
6. For Statement of Objects and Reasons, see Haryana Government Gazette (Extraordinary),
dated 25th August, 2020, page-1760.
FISCAL  RESPONSIBILITY  AND
BUDGET  MANAGEMENT
2005 : Hr. Act 6]
376
1(2) It shall come into force on such date as the State Government
may, by notification in the Official Gazette, appoint in this behalf.
2. In this Act, unless the context otherwise requires,—
(a) 2[“aided institution employee” means a person in the whole
time employment of any primary school, secondary school,
college, university or technical education institution recognised
and aided by the State Government for payment of salary, etc.;]
(aa) “budget” means the annual financial statement laid before the
House of the Legislature of the State of Haryana under article
202 of the Constitution of India;
(b) “current year” means the financial year preceding the ensuing
year;
(c) “ensuing year” means the financial year for which the budget is
being presented;
(d) “financial year” means the year beginning on the 1st April and
ending on 31st March next following;
(e) “GSDP” means Gross State Domestic Product at current market
prices;
(f) “fiscal deficit” is the excess of aggregate disbursements (net of
debt repayments) over revenue receipts, recovery of loans and
non-debt capital receipts;
(g) “fiscal indicators” are such indicators as may be prescribed for
evaluation of the fiscal position of the State Government;
(h) “fiscal targets” are the numerical ceilings and proportions to
total revenue receipts (TRR) or GADP for the fiscal indicators;
(i) “prescribed” means prescribed by rules made under this Act;
(j) “previous year” means the year preceding the current year;
3[(jj) “public sector employee” means a person in the wholetime
employment of any public sector undertaking including boards
and corporations of the State of Haryana and drawing salary
from the concerned institute;]
(k) “revenue deficit” means the difference between revenue
expenditure and total revenue receipts (TRR);
Explanation.– Total revenue receipts (TRR) includes State’s
own revenue receipts (both tax and non-tax) and current transfers
from the Centre (comprising grants and State’s share of Central taxes).
1. The Act came into force vide Haryana Government Finance Department, Notification No.
S.O. 95/HA.6/2005/S.I./2005, dated 7-12-2005 w.e.f. 7-12-2005.
2. Inserted by Haryana Act 8 of 2006.
3. Inserted by Haryana Act 8 of 2006.
FISCAL  RESPONSIBILITY  AND
BUDGET  MANAGEMENT
[2005 : Hr. Act 6
Definitions.
377
(l) “special purpose vehicle” means an organisation or institution
set up by State Government to discharge specific assignments/
duties within a specified period in respect of financial
transactions or raising of loans from financial institutions or
the market for specific purposes against State guarantees;
(m) “State Government” means the Government of the State of
Haryana; and
(n) “total liabilities” means the liabilities under the Consolidated
Fund of the State and the public accounts of the State and shall
also include borrowings by the public sector undertakings and
the special purpose vehicles and other equivalent instruments
including guarantees where the principal and/or interest are to
be serviced out of the State budgets.
3. The State Government shall—
(a) take appropriate measures to eliminate the revenue deficit and
thereafter build up adequate revenue surplus and contain the
fiscal deficit at a sustainable level, and utilize such surplus for
discharging the liabilities in excess of the assets or for funding
capital expenditure;
(b) pursue policies to raise non-tax revenue with due regard to cost
recovery and equity; and
(c) lay down norms for prioritization of capital expenditure, and
pursue expenditure policies that would provide impetus for
economic growth, poverty reduction and improvement in human
welfare.
4. The State Government shall be guided by the following fiscal
management principles, namely:—
(a) transparency in setting the fiscal policy objectives, the
implementation of public policy and the publication of fiscal
information so as to enable the public to scrutinize the conduct
of fiscal policy and the State of public finances;
(b) stability and predictability in fiscal policy making process and
in the way fiscal policy impacts the economy;
(c) responsibility in the management of public finances, including
integrity in the budget formulation;
(d) fairness to ensure that policy decisions of the State Government
have due regard to their financial implications on future
generations; and
(e) efficiency in the design and implementation of the fiscal policy
and in managing the assets and liabilities of the public sector
balance sheet.
Fiscal
management
objectives.
Fiscal
management
principles.
FISCAL  RESPONSIBILITY  AND
BUDGET  MANAGEMENT
2005 : Hr. Act 6]
378
5. The State Government shall in each financial year lay before the
House of the State Legislature, the following statements of fiscal policy along
with the budget, namely:—
(a) the Macroeconmic Framework Statement;
(b) the Medium Term Fiscal Policy Statement; and
(c) the Fiscal Policy Strategy Statement.
6. The macroeconomic framework statement, in such form as may be
prescribed, shall contain an overview of the State economy, an analysis of growth
and sectoral composition of GSDP, an assessment related to State Government
finances and future prospects.
7. (1) The medium term fiscal policy statement shall set forth a three-
year rolling target for the prescribed fiscal indicators with clear enunciations of
the underlying assumptions.
(2) In particular and without prejudice to the provisions contained
in sub-section (1), the medium term fiscal policy statement shall include the
various assumptions behind the fiscal indicators and an assessment of sustainability
relating to—
(i) the balance between revenue receipts and revenue
expenditure;
(ii) the use of capital receipts including borrowing for
generating productive assets; and
(iii) the estimated yearly pension liabilities worked out on
actuarial basis for the next ten years:
Provided that in case it is not possible to calculate the
pension liabilities on actuarial basis during the period of first
three years after the coming into force of this Act, the State
Government may, during that period, estimate the pension
liabilities by making forecasts on the basis of trend growth
rates.
8. The fiscal policy strategy statement shall be in such form as may be
prescribed and shall contain, inter alia—
(i) the fiscal policies of the State Government for the ensuing year
relating to taxation, expenditure, borrowing and other liabilities
(including borrowings by public sector undertakings and special
purpose vehicle and other equivalent instruments where
liability for repayment is on the State Government), lending,
investments, other contingent liabilities, user charges on public
goods/utilities and description of other activities, such as
guarantees and activities of public sector undertakings which
have potential budgetary implications;
Macroeconomic
framework
statement.
Medium term
fiscal policy
statement.
Fiscal policy
strategy
statement.
FISCAL  RESPONSIBILITY  AND
BUDGET  MANAGEMENT
[2005 : Hr. Act 6
Fiscal policy
statements to be
laid before the
State Legislature.
379
(ii) the strategic priorities of the State Government in the fiscal
area for the ensuing year;
(iii) the key fiscal measures and the rationale for any major deviation
in fiscal measures pertaining to taxation, subsidy, expenditure,
borrowings and user charges on public goods/utilities; and
(iv) an evaluation of the current policies of the State Government
via-a-vis the fiscal management principles set out in section 4,
the fiscal objectives set out in the medium term fiscal policy
statement in sub-section (1) of section 7 and fiscal targets set
out in section 9.
9. (1) The State Government may prescribe such targets as may be
deemed necessary for giving effect to the fiscal management objectives.
1[(2) In particular, and without prejudice to the generality of the
foregoing provisions, the State Government shall—
(a) attain zero revenue deficit target from 2011-12 and
maintain the same till 2014-15 :
(b) 2[for the Financial year 2020-21, additional fiscal deficit
of 2% over and above 3% of GSDP (upto 5% of GSDP)
shall be permissible;]
(c) ensure that the outstanding debt as percentage of GSDP
shall be 22.4% in 2010-11, 22.6% in 2011-12, 22.7% in
2012-13, 22.8% in 2013-14 and 22.9% in 2014-15 :
Provided that revenue deficit and fiscal deficit may exceed
the limits specified under this section due to ground or grounds
of unforeseen demands on the finances of the State Government
arising out of internal disturbance or natural calamity or national
security or such other exceptional grounds as the State
Government may specify:
Provided further that a statement in respect of the ground
or grounds specified in the first proviso shall be placed before
the House of the State Legislature, as soon as may be, after such
deficit amount exceeds the aforesaid targets;
(d) bring out annual statement giving prospects for the State’s
economy and related fiscal strategy; and
(e) bring out special reports along with the budget giving
details of number of employees in Government, public
sector and aided institutions and their related salaries.]
Fiscal targets.
1 Substituted by Haryana Act 5 of 2011 w.e.f. 1st April, 2010.
2. Substituted by Haryana Act 24 of 2020.
FISCAL  RESPONSIBILITY  AND
BUDGET  MANAGEMENT
2005 : Hr. Act 6]
380
10. (1) The State Government shall take suitable measures to ensure
greater transparency in its fiscal operations in the public interest and minimize as
far as practicable, secrecy in the preparation of the budget.
(2) In particular, and without prejudice to the generality of the
foregoing provisions, the State Government shall, at the time of presentation of
the budget, make disclosures on the following, along with detailed information
in such forms as may be prescribed:—
(a) the significant changes in the accounting standards,
policies and practices affecting or likely to affect the
computation of fiscal indicators;
(b) details of borrowings by way of ways and means advances/
overdraft availed of from the Reserve Bank of India.
(3) Whenever the State Government undertake unconditionally
and substantially to repay the principal amount and/or pay the interest of any
separate legal entity, it has to reflect such liability as the borrowings of the State.
11. (1) The Minister-in-Charge of the Department of Finance
(hereinafter referred to as “Minister of Finance”) shall review, half yearly, the
trends in receipts and expenditure in relation to the budget estimates and place
before the House of the State Legislature, the outcome of such reviews.
(2) Whenever there is either shortfall in revenue or excess of
expenditure over the intra-year targets mentioned in the fiscal policy strategy
statement or the rules made under this Act, the State Government shall take
appropriate measures for increasing revenue and/or for reducing the expenditure,
including curtailment of the sums authorised to be paid and applied from out of
the Consolidated Fund of the State:
Provided that nothing in this sub-section shall apply to the
expenditure charged on the Consolidated Fund of the State under clause (3) of
article 202 of the Constitution of India or any other expenditure, which is required
to be incurred under any agreement or contract, which cannot be postponed or
curtailed.
(3) (a) Except as provided under this Act no deviation in meeting
the obligations cast on the State Government under this
Act shall be permissible without approval of the State
Legislature.
(b) Where owing to unforeseen circumstances, any deviation
is made in meeting the obligations cast on the State
Government under this Act, the Minister of Finance shall
make a statement in the House of the State Legislature
explaining—
Measure to
enforce
compliance.
FISCAL  RESPONSIBILITY  AND
BUDGET  MANAGEMENT
[2005 : Hr. Act 6
Measures for
fiscal
transparency.
381
(i) any deviation in meeting the obligations cast on
the State Government under this Act;
(ii) whether such deviation is substantial and relates to
the actual or the potential budgetary outcomes; and
(iii) the remedial measures, the State Government
proposes to take.
(4) Any measure proposed in the course of the financial year, which
may lead to an increase in revenue deficit, either through increased expenditure
or loss of revenue, shall be accompanied by a statement of remedial measures,
proposed to neutralise such increase or loss and such statement shall be placed
before the House of the State Legislature.
(5) The State Government may set up an agency 
1[* * * * * * *] to
review periodically the compliance of the provisions of this Act and table such
reviews in the House of the State Legislature.
12. No suit, prosecution or other legal proceedings shall lie against the
State Government or any officer of the State Government for anything which is in
good faith done or intended to be done under this Act or the rules made thereunder.
13. The provisions of this Act shall be in addition to, and not in derogation
of, the provisions of any other law for the time being in force.
14. (1) If any difficulty arises in giving effect to the provisions of this
Act, the State Government may, by order published in the Official Gazette, make
such provisions not inconsistent with the provisions of this Act as may appear to
be necessary for removing the difficulty:
Provided that no order shall be made under this section after
the expiry of two years from the commencement of this Act.
(2) Every order made under this section shall be laid, as soon as
may be after it is made, before the State Legislature.
15. (1) The State Government may, by notification in the Official
Gazette, make rules for carrying out the purposes of this Act.
(2) In particular, and without prejudice to the generality of the
foregoing power, such rules may provide for all or any of the following matters,
namely:—
(a) the form of the macroeconomic framework statement
under section 6;
(b) the form of medium term fiscal policy statement, including
the rolling targets for the fiscal indicators under
section 7;
1 Omitted by Haryana Act 8 of 2006.
Protection of
action taken in
good faith.
Power to remove
difficulties.
Power to make
rules.
FISCAL  RESPONSIBILITY  AND
BUDGET  MANAGEMENT
2005 : Hr. Act 6]
Application of
other laws not
barred.
382
(c) the form of fiscal policy strategy statement under
section 8;
(d) the forms for disclosure under sub-section (2) of
section 10;
(e) measures to enforce compliance;
(f) the manner of review of compliance of the provisions of
this Act by the independent agency under section 11;
and
(g) any other matter which is required to be, or may be,
prescribed.
(3) Every rule made under this Act shall be laid, as soon as may be,
after it is made, before the House of the State Legislature, while it is in session. If
the House agrees in making any modification in the rule or the House agrees that
the rules should not be made, the rule shall thereafter have effect only in such
modified form or be of no effect, as the case may be, however, that any such
modification or annulment shall be without prejudice to the validity of anything
previously done under that rule.
FISCAL  RESPONSIBILITY  AND
BUDGET  MANAGEMENT
[2005 : Hr. Act 6

‹ Prev All Haryana acts Next ›