Budget 2021: Why and when was Rail Budget merged with Union Budget? Know the motive behind One Nation, One Budget

New Delhi: The Union Cabinet in 2016 had decided to merge the Railway Budget with the General Budget, thus ending the 92-year-old tradition of having a separate Railway Budget.

A separate Railway Budget was started by the British in 1924. Even after the merger, the distinct entity and the functional autonomy of the Railways, as was envisioned, has been maintained.

Following the merger of Union Budget with Railway budget, the Railways does not have to pay dividend to the central government though it would still get gross budgetary support from the exchequer. As far as the salary and pension bill of Railway employees is concerned, it remains the responsibility of the national transporter as there is no change in the existing practice.

The merger of Rail and General Budgets does not impact the functional autonomy of the railways but help in enhancing capital expenditure.

The decision to merge the Railway Budget with the General Budget has also been seen as a significant one, as in recent years political heavyweights, particularly regional satraps, have used this occasion to nurture their constituencies in a big way.

Late BJP leader Arun Jaitley became the first Finance Minister in 2017, presenting the unified Budget for 2017-18.

Another change that the Union Budget 2017-18 saw was that for the first time the date of presentation was advanced by nearly a month, besides co-opting the Railway Budget into it. The government was in favour of advancing the Budgetary exercise so that it could be completed before March 31 and expenditure on public-funded schemes could begin from April 1.

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The Cabinet also decided to do away with the Plan/ Non-Plan expenditure classification in Budget 2017-18 and replace with ‘capital and receipt’.