Government extends scope of 13th Finance Commission

July 31st, 2008 - 7:31 pm ICT by ANI  

New Delhi, July 31 (ANI): The Union Government has mandated the 13th Finance Commission to map the road for fiscal accounting of liabilities on account of oil, food and fertiliser bonds.

Cabinet has approved extension of Terms of Reference of 13th Finance Commission having regard to the need to bring liabilities of the central government on account of oil, food and fertiliser bonds into fiscal accounting, Information and Broadcasting Minister P R Dasmunsi told reporters here.

The Commission, headed by Vijay Kelkar, would also review the impact of various other obligation of central government on the deficit target.

Meanwhile, the Centre on Thursday approved an allocation Rs 17,033 crore for revamping a power sector reforms programme aimed at cutting commercial and other losses of state utilities.

The decision to restructure the Accelerated Power Development and Reforms Programme (APDRP) covering 571 projects in the first phase was taken by the Union Cabinet at its meeting here.

Out of the Rs 17,033 crore, the grant component is Rs 6,445 crore and the loan component is Rs 2,274 crore, Finance Minister P Chidambaram told reporters after the Cabinet meeting.

He added that the loan would be for those who accept certain parameters both in the utility areas and project areas.

In the project area the utilities have to bring down Aggregate Technical & Commercial (AT&C) losses to below 15 per cent, whereas in the utility area, which is a larger area, they have to bring them down by 3 per cent or 1.5 per cent depending upon where they are.

If they achieve the parameters, 50 per cent of loan will be converted as grant, Chidamabram said.

The government had approved APDRP in March 2003 to accelerate distribution sector reforms.

The government also decided to provide an additional Rs 1,000 crore to Life Insurance Corporation to cover another one crore rural landless households under the social security scheme ”Aam Admi Bima Yojana”. (ANI)

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