Financial Powers of the Governor

The Governor of a state is comparable to the president of a country. The president delegated power to the Prime Minister to govern the country because he is the head of state. Department and agency heads, many of whom have the authority to choose, support, and assist governors in carrying out their management and leadership responsibilities and objectives.

When a CM loses an election, he or she typically gives the Governor his or her resignation. In front of the Governor, the newly-elected Chief Minister also takes an oath, and the Governor is the one who grants him the powers of the Chief Minister.

Financial Powers of the Governor

• He ensures that the state legislature receives the Annual Financial Statement (state budget).
• Money bills can only be introduced in the state legislature with his approval, and no grant requests can be made unless he recommends them.
• He can borrow money from the state’s contingency fund to cover unexpected expenses.
• He appoints a finance commission every five years to assess the financial situation of panchayats and municipalities.

State Budget

The term “state budget” refers to all foreign expenditures and revenues estimated and realized over a set period by competent authorities to carry out the state’s functions and tasks.

It is required not only by organizations but also by individuals. It is obligatory for governments. We can’t manage our finances wisely unless we know how much money we have, how much we need to spend, and, ultimately, how we’ll make ends meet. A budget, then, is a plan for estimated financial management over a set period of time, usually a year.

It is critical to recognize that all budgets presented in India derive their authority from the constitution, which serves as the foundation for budget preparation and presentation. As a result, both the center and the state must present the Annual Financial Statement. Receipts and expenditures, for example, must be presented, and so on. The information that Parliament and state legislatures must present and vote on remains unchanged. The difference is in the presentation formats: states choose their formats based on practice and convenience. Also, revenue sources differ by state, and similar differences can be seen in expenditure profiles.

Money Bill

There are two points to consider:

• Money bill
• Financial statement

We must first recognize that all money bills are financial bills, but not all financial bills are money bills. As a result, money bills have some unique characteristics: they deal with taxation, the consolidated fund of India, and union government borrowing and credit.

Money bills have a variety of other characteristics:

• A minister can only pass a money bill.
• It can only be brought up in the Lok Sabha.
• Withdrawn money bills cannot be amended or changed by the Rajya Sabha. It has 14 days to pass and can only make recommendations. If the RS fails to pass the money bill, it is automatically passed. It means that Lok Sabha has full power.
• Also, the president can only give an accent or refuse to sign the bill. He is at a loss for what to do.

Article 110 of the Indian Constitution deals with the country’s money bill. Only a few provisions allow a bill to be considered a money bill. The following are the provisions that make a bill a money bill in India:

• The levying, repealing, remission, modifying, or regulating of any tax
• The Union government’s borrowing of money is regulated.
• Custody of the Consolidated Fund of India or the India Contingency Fund and the deposit and withdrawal of funds from either.
• The appropriation of funds from India’s Consolidated Fund
• Any expenditure charged to the Consolidated Fund of India must be declared, or the amount of any such expenditure must be increased.
• The receipt of funds for the Consolidated Fund of India or the public account of India, or the custody or distribution of such funds, or the audit of the Union’s or a state’s accounts.
• Any matter that is unrelated to any of the matters mentioned above

Article 110 of the Indian Constitution also contains provisions that prevent a bill from being considered a money bill.

• Tax provisions, whether they relate to the imposition, repeal, remission, modification, or regulation of any tax.
• Consolidated Fund of India provisions:
  • Payment into or borrowing from it
  • Setting aside money from it for a specific purpose
  • Declaration of any new expenditure to be charged from it
  • An increase in the amount of any expenditures charged to it
  • Money in the fund receipt and custody
• Provisions relating to the Indian Contingency Fund – custody of funds and withdrawal or payment of funds into the fund.
• Provisions relating to the Indian Public Accounts Department’s receipt, custody, and distribution of funds. 

Conclusion

The Governor of a state is more than just a figurehead. His prudence has a few powers, and the state Chief Minister’s ideas do not bind him. The position of Governor is far from useless. The Governor serves as a conduit between the federal and state governments. When he serves as the nominal and constitutional head of state regularly, and when he serves as the entire head of state during the president’s rule, he acts as the president’s operator in the country. The Governor has the authority to advise, encourage, and warn the ministry, regardless of their political affiliation.