18.22        ndian    onom
              and to put political responsibility on the   were accepted by the Government in the Union
              government.                                  Budget 2018-19. These are—keeping Central
         (ii) The RBI will not be the primary subscriber   Government’s Debt-GDP ratio at 40 per cent and
              to government securities in the future—      a fiscal glide path (of 0.5 per cent flexibility). These
              committed way back in 1997.                  changes (introduced through amending the Act)
       3. The fiscal responsibility on the governments:    are expected to give enough fiscal space to the
          (i) The Fiscal Responsibility and Budget         Government to consolidate the fiscal situation of
              Management (FRBM) Act was passed             the economy.
              in 2003 (voted by all political parties)
              which puts constitutional obligation            Zero-Base BudgetIng
              on the government to commit so many          The idea of zero-base budgeting (ZBB) first came
              things as fiscal responsibility comes        to the privately owned organisation of the USA by
              in the public finance—fixing annual          the 1960s. This basically belonged to a long list of
              targets to cut revenue and fiscal deficits;  guidelines for managerial excellence and success,
              the government not to borrow from the        others being Management by Objectives (MBO),
              RBI except by the WMA; government            Matrix Management, Portfolio Management,
              to bring in greater transparency in fiscal   etc to name a few.51 It was the US financial
              operations; along with the Budget the        expert Peter Phyrr who first proposed this idea
              government to lay statements regarding       for government budgeting and Jimmy Carter,
              fiscal policy strategy in the House and      Govornor of Georgia, USA was the first elected52
              Quarterly Review of trends of receipts
                                                           executive to introduce ZBB to the public sector.
              and expenditures of the government.
                                                           When he presented the US Budget in 1979 as the
         (ii) A mechanism (to include state                US President it was the first use of the ZBB for any
              governments under the umbrella of            nation state. Since then many governments of the
              fiscal responsibility) was advised (now      world have gone for such budgeting.
              implemented, too) by the 12th Finance
                                                                 Zero-base budgeting is the allocation of
              Commission which allows the state
                                                           resources to agencies based on periodic re-
              governments to go for market borrowing
                                                           evaluation by those agencies of the need for all
              (without central permission) for their
                                                           the programmes for which they are responsible,
              need of plan development provided they
                                                           justifying the continuance or termination of each
              pass their fiscal responsibility acts (FRAs)
                                                           programme in the agency budget proposal—in
              and commit to the fiscal responsibility
                                                           other words, an agency reassesses what it is doing
              regarding cutting their revenue and fiscal
              deficits. By March 2016, all states and        51.   George R. Terry and stephen G. Franklin, Principles
              UTs had implemented their FRAs.                      of Management (New Delhi: AITBs, 2002), pp. 9–10.
                                                             52.   see Peter A. Phyrr, ‘The zero Base Approach to
          Government’s follow-up to the FRBM
                                                                      overnment udgeting , u lic d inistration
     Act has shown mixed results. Introspecting the                  evie , ( an Fe ,           , 7; and Thomas P. Lauth,
     situation, the Government did set up a review                    ero ase udgeting in eorgia State overnment
     committee on the Act in 2016-17 with a wish to                   yth and eality , u lic d inistration evie , 38
                                                                    Sept. ct.,       pp.           cited in icholar Henry,
     have ‘range’ as the target of fiscal deficit in place         Public Administration and Public Affairs (New Delhi:
     of ‘number’. Some key advices of the Committee                  rentice Hall,     , p.   .