Meaning: -Public economics is a branch of economics. It is concerned with the ways and means by which public (government) authorities raise funds to incur expenditure so as to achieve certain socio-economic objectives. The raising of funds and the expenditure thereof is done in a systematic manner with the help of budget.
A public budget is a systematic estimate of government revenue and expenditure for a period of one year. The annual financial statement is the budget of the Central Government.
1. Systematic Estimates: -The Central Government budget is a systematic estimates of receipts and expenditure. This estimate is made on the basis of performance of the economy, development needs, economic situation in the country, and other socio-economic factors.
2. Period of the budget: - The budget is normally prepared for a period of one year. In India, the budget is prepared for the financial year beginning from 1st April and ending on 31st March.
3. Presentation of the budget: -The Finance Minister presents the budget in the Parliament. Such presentation is required to get the approval of the parliament to collect funds and to undertake the expenditure. In India, the Central Government budget is presented on the last day of February.
4. Revision in Budget Estimates: -The government may revise budget estimates taking into consideration the general socio-economic situation in the country.
5. Objectives:- The budget is undertaken to achieve certain socio-economic objectives such as:
· Employment generation
· Social development, such as increase in literacy, and health standards.
· Regional development.
· Infrastructure development
· Capital Formation
· Reduction of inequalities
· Economic development
6. Comprehensive Term: - The budget is comprehensive in nature. It includes all receipts and expenditure for a particular year. The receipts can be revenue receipts (such as tax revenue) and Capital receipts (such as borrowings). The expenditure is also divided into two parts—revenue expenditure (such as interest payments) and capital expenditure (such as expenditure on infrastructure)
