Press Release

New Delhi, 29 April 2020:  Budget transparency is an important parameter of fiscal governance always. But it assumes greater significance during the times of the COVID-19 pandemic, as a sizable chunk of public expenditure is likely to get financed by higher magnitudes of government borrowing not just in the current fiscal but in the subsequent couple of years too. In order to ensure that the hard earned public resources (both tax revenue and borrowed money) are used judiciously and accountably, a high degree of transparency needs to be maintained with government finances.

A global survey by the International Budget Partnership (IBP) draws attention to the importance of enhancing budget transparency and strengthening accountability for government budgets. The Survey, covering 117 countries, rates the level of budget transparency across countries on a scale of 0-100, based on several normative, internationally comparable indicators. It evaluates for each country, for instance, the availability of eight key budget documents of the Central or Federal Government, and assesses whether these are made public, in a timely manner, and provide comprehensive information.

The Open Budget Survey 2019,  released today, gives India, for the Union Budget, a transparency score of 49 out of 100; the global average score of budget transparency is 45. If one compares India’s performance in this global biennial survey, there is stagnation over the last few years. In the survey for 2019, India ranks 53^rd among the 117 countries covered.

New Zealand tops the chart with a score 87 out of 100. Some of the other large developing countries, with the exception of China, have got much higher transparency scores compared to India. South Africa (87), Mexico (82) and Brazil (81) are among the top six countries providing ‘extensive’ information to public for scrutiny. Another BRICS member, Russia, is categorised under ‘substantial’ information category with a score of 74 out of 100. India is in the category of ‘limited’ budgetary information being available to the public for scrutiny. China, however, is far behind with a very low budget transparency score of 19.

Nonetheless, India performs well in publishing timely and relevant information in the Audit Reports and In-Year Reports, areas where the country has scored well and above many of the other countries surveyed. The absence of a published Pre-Budget Statement and not bringing out any Mid-Year Review in 2018-19 have pulled down the transparency score for the Union Budget of India.

Providing adequate space for public participation for priority setting in its budgets is also flagged by the OBS as an area of improvement required for India. The survey report argues that the Union Government should also publish a Pre-Budget Statement, which can be scrutinised by the legislators and the public at large before the annual budget is presented. Similarly, timely and regular online publication of Mid-Year Review reports could improve the budget transparency score for India significantly. Designing and institutionalising a mechanism for citizens’ feedback on budget implementation and monitoring, and expanding the means and coverage of pre-budget consultations are also advocated for enhancing budget transparency in India at the national level.

As mentioned earlier, the OBS scrutinises budget transparency at the level of the Union Government’s budget, the challenges pertaining to budget transparency in the country are far more daunting at the district and sub-district levels. In order to ensure effective and accountable use of public resources, budget transparency needs to be enhanced not only at the Union Government and State Government levels, but also at the district and sub-district levels. The latter, according to Delhi-based think tank Centre for Budget and Governance Accountability (CBGA), requires public availability of locally relevant and usable / consumable budget information in every district across the country.

A study by CBGA, called “The Budget Trails”, unveiled recently in January this year, has highlighted the major obstructions in budget transparency at the district level and suggested a number  of reforms necessary. For instance, creating an integrated (i.e. for all development sectors) budget and expenditure information architecture at every district headquarter and enabling the District Development Coordination and Monitoring Committee (DISHA Committee) to use this information to enforce accountability of the executive for budget implementation, according to CBGA, will substantially improve budget transparency and accountability at the district level in the country.

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