Fiscal Policy Statements. 2

(1) The State Government shall lay, in every financial year, before State Legislature, the Medium Term Fiscal Policy Statement and the Fiscal Policy Strategy Statement alongwith the budget. (2) The Medium Term Fiscal Policy Statement and the Fiscal Policy Strategy Statement shall set forth the fiscal objectives, strategic priorities of the State Government and a three years rolling target for fiscal management laid down in section 5 with enunciation of underlying assumptions. (3) In particular, and without prejudice to the provisions contained in sub-section (2), the medium term fiscal policy statement shall include assessment of sustainability relating to,- (a) the balance between revenue receipt and the revenue expenditure; (b) the use of capital receipts including open market borrowings for generating productive assets; and (c) the estimated yearly pension liabilities worked out on actuarial basis, for the next ten years, within such period as the State Government may, by order, specify. (4) The Fiscal Policy Strategy Statement shall, inter-alia, contain (i) The policies of the State Government for the ensuing financial year relating to taxation, expenditure, borrowings (including the borrowings by Public Sector Undertakings and special purpose vehicles and other equivalent instruments where liability for repayment is on the State Government, with ceiling fixed for each agency) and other liabilities, lending and investments, pricing of administered goods and services and description of other activities such as guarantees and the activities of the public sector undertakings which have potential budgetary implications and the key fiscal measures and targets pertaining to each of these; (ii) the strategic priorities of the State Government in the fiscal areas for the ensuing financial year; (iii) key fiscal measures and their rationale for any major deviation in fiscal measures pertaining to taxation, subsidy, expenditure, administered pricing and borrowings; (iv) evaluation as to how the current policies of the State Government are in conformity with the fiscal management principles as set out in section 4 and the objectives set out in Medium Term Fiscal Policy Statement; (v) evaluation of the performance of the fiscal indicators presented in the previous year vis-a-vis the targets set out earlier and the likely performance in the current year. (5) The Medium Term Fiscal Policy Statement and the Fiscal Policy Strategy Statement referred to in sub-section (1) shall be in such form as may be prescribed.