What is the role of the finance minister under the FRBM Act?
Show answer & explanation
Correct answer: D
Explanation
Answer: To present fiscal policy statements to Parliament
Explanation: Under the Fiscal Responsibility and Budget Management Act, 2003, the Finance Minister is responsible for ensuring fiscal discipline and transparency in government finances. A key role under this Act is to present fiscal policy statements to Parliament, which include details about revenue deficit, fiscal deficit, and medium-term fiscal strategy.
These statements help Parliament monitor the government’s adherence to fiscal targets such as reducing deficits and managing public debt.
Additional Key Facts
FRBM Act aims to ensure fiscal discipline and macroeconomic stability.
Key targets include:
Reducing fiscal deficit
Controlling revenue deficit
Managing public debt sustainably
Important documents presented include:
Medium-Term Fiscal Policy Statement
Fiscal Policy Strategy Statement
Macroeconomic Framework Statement
The Act applies to both Central and State governments (with State-level FRBM Acts).
Potential Exam-Oriented Questions & Answers
Question: What is the main objective of the FRBM Act?
Answer: Fiscal discipline and deficit reduction
Question: What does fiscal deficit mean?
Answer: Excess of expenditure over revenue