What Are The Canons Of Public Expenditures?


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Anonymous Profile
Anonymous answered
These are the principles to govern the public expenditure decisions . They include:
(a) Canon of economy : Care must be taken to avoid wasteful usage of public funds.
(b) canon of sanction: There must be  proper authority for public spending.
(c) Canon of benefit: Be incurred only when it is beneficial to the society.
(d) canon of surplus: Government should avoid deficit budgeting.
Jack Reaper Profile
Jack Reaper answered

The canons of Public Expenditure were given by G.F.Shirras and are as follows:

  • Canon of Benefit- Public Funds must be spent in directions most conclusive to the public interest. Maximum Utility must be attained by Public Expenditure. It must aim at maximum social advantage. Eg- Expenditure of Health, Education, Defense, etc.
  • Canon of Economy- Avoiding wasteful use of resources. It includes not merely effecting economy in expenditure but also in protecting tax payers money. State should economise its  resources so as to fulfill the needs of the present and the productive power of the State must be developed.
  • Canon of Surplus- Meant for avoidance of Deficit in State's budget. Underlying Principle is that the State should not spend resources collected. Just like an Individual a state must also prefer surplus budget, as it helps in economising the resources.
  • Canon of  Sanction- No public expenditure must be sanctioned which at a latter date is likely to involve expenditure beyond its own power of sanction. Expenditure must be sanctioned by authority competent to sanction it. Money sanctioned for any scheme must be used only for that purpose.

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