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Government today issued General Financial Rules, 2005 which come in force with immediate effect. General Financial Rules (GFRs) are a compendium of general provisions to be followed by all offices of Government of India while dealing with matters of a financial nature. The GFRs issued by Ministry of Finance, Department of Expenditure is follow up action on the fiscal policy strategy statement laid in the Parliament in the Budget Session.
The salient features of the revised GFRs are:-
i. Systems of procurement, accounting and disposal of goods have been liberalized;
ii. Rules have been simplified and re-arranged for easy comprehension;
iii. Instructions on new areas of governance such as Government guarantees, engagement of consultants, outsourcing of services etc. which did not exist in the existing GFRs, 1963 have been included de novo;
iv. Redundant appendices and forms have been deleted. New forms relating to fresh activities inserted and the remaining forms updated. To avoid confusion in respect of retained/revised forms, existing form numbers have been retained;
v. Limits of delegation have been substantially raised to provide greater flexibility to officers transacting government business and facilitate quick decision making while ensuring accountability and responsibility;
vi. Monetary limits for advertised tender enquiry has been raised from Rs.2 lakhs to Rs.25 lakhs. Purchase Committees have now been authorized to make purchases of goods of the value between Rs.15000 to Rs.1 lakhs. Purchases of goods of up to Rs.15000 on each occasion are allowed without inviting quotations based on certified personal satisfaction of the competent authority; and
vii. Chapter on ‘Advances’ to Government employees has been deleted, as ‘advances’ are distinct from direct government expenditure. The same has been issued as a separate compendium.
General Financial Rules were first issued in 1947 and were in the form of executive instructions. These were subsequently modified and issued as General Financial Rules, 1963. Over the last four decades, these GFRs had to be amplified and supplemented by various decisions of the Government of India. Many of the rules had also become redundant. These developments including a rapid growth of alternative service delivery systems, developments in information technology, outsourcing of services and liberalization of the system of procurement, accounting and disposal of goods in line with the international practices, necessitated an overall review of the General Financial Rules, 1963.
BSC/BY/GN-246/05
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