With reference to Union Budget, which of the following is/are covered under Non-Plan Expenditure? 1. Defence expenditure 2. Interest payments 3. Salaries and pensions 4. Subsidies Select the correct answer using the code given below.
- (a) 1 only
- (b) 2 and 3 only
- (c) 1, 2, 3 and 4 ✓ UPSC's answer
- (d) None
Why the answer is (c)
• Until 2017–18 the Union Budget divided expenditure into Plan (schemes under the Five-Year Plans) and Non-Plan.
• Non-Plan expenditure covered the Government's committed and routine outgo — defence (1), interest payments (2), salaries and pensions (3), subsidies (4), grants to States and loans to PSUs.
• All four items were Non-Plan; the distinction was abolished in favour of revenue/capital classification.
• Hence 1, 2, 3 and 4, option (c).
Why the other options are wrong
- (a) 1 only
- Interest, salaries and subsidies were also Non-Plan.
- (b) 2 and 3 only
- Defence and subsidies were also Non-Plan.
- (d) None
- All four were Non-Plan items.
Asked in the GS Paper I of the UPSC Civil Services Preliminary Examination 2014, held on 24 August 2014. Question and answer key: Union Public Service Commission. Explanation: UPSC Answer Check.