Govt Starts Budget 2027-28 Preparations With Focus On Fiscal Discipline, Realistic Estimates

New Delhi, Aug 29 (KNN) The government has begun preparations for the Union Budget 2027-28, with the Finance Ministry issuing a Budget Circular that sets out deadlines for ministries and departments to submit estimates for the Revised Estimates (RE) for 2026-27 and Budget Estimates (BE) for 2027-28.

The exercise places emphasis on realistic expenditure projections, fiscal discipline and prioritising committed spending before allocations are sought for new schemes.

October Deadlines for Ministries

Financial Advisers have been directed to enter information required under Appendices I to VII into the Union Budget Information System (UBIS) by October 6, 2026. 

Details relating to non-tax revenue, interest receipts, loan recoveries, capital receipts, interest payments and employee loans are also due by the same date.

Estimates of tax receipts are to be submitted by October 15, while disclosures required under the Fiscal Responsibility and Budget Management (FRBM) framework must be submitted by November 6.

The government has said pre-Budget meetings will not be rescheduled because of delays in data entry.

Pre-Budget Meetings From October 12

Internal consultations with ministries and departments will begin on October 12 and continue until mid-November. The meetings, chaired by Expenditure Secretary V Vualnam, will examine expenditure requirements, receipts, scheme approvals and fiscal priorities.

The inputs will be used to provisionally finalise the BE for 2027-28 and RE for 2026-27. Final expenditure ceilings are expected to be reflected in UBIS by the end of December.

Ministries will then be required to finalise their Detailed Demands for Grants (DDGs) within one week of receiving the final ceilings. Other supporting documents and expenditure statements will follow within specified timelines.

Focus on Realistic Estimates

The circular asks ministries to base estimates on actual spending up to September 30, 2026, expenditure during the corresponding period of the previous year and full-year expenditure in the preceding financial year. Pending arrears, reappropriations and unspent balances under various schemes are also to be considered.

Ministries have been advised to avoid routine mid-year reappropriations and large year-end savings. The government said minimal mid-year additional resource requirements and reappropriations would indicate sound budgeting.

Committed and continuing expenditure is to be given priority before provisions are made for new schemes or expenditure items. Schemes continuing into the 16th Finance Commission cycle must also have the required appraisal and approvals, with final Expenditure Finance Committee memoranda submitted before the pre-Budget meetings.

Fiscal Discipline and Revenue Mobilisation

The circular directs ministries to rationalise expenditure and ensure that discontinued schemes do not receive allocations. Funds under Central Nodal Agencies, Single Nodal Agencies, unspent Treasury Single Account assignments and unused Mother Sanctions are also to be reflected appropriately.

The pre-Budget consultations will also examine departmental receipts, non-tax revenues and efforts to recover outstanding dues. Ministries and autonomous bodies have been asked to assess scope for increasing user charges to recover service costs while providing a reasonable return on capital invested.

The exercise will also review compliance with the applicable dividend policy by central public sector enterprises.

The Budget exercise is taking place against the backdrop of continuing supply-chain disruptions linked to the West Asia conflict. 

(KNN Bureau)