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
Correct Answer
D
None
Explanation
Option (c) is correct because Non-Plan Expenditure traditionally encompassed all committed government spending not linked to Five-Year Plans, specifically including interest payments, defense services, subsidies, and administrative costs like salaries and pensions. Option (b) is a common pitfall for candidates who incorrectly assume that defense and subsidies are developmental or plan-related, when in fact they historically constituted the largest components of non-plan outlays. The core concept tested is the classification of the Union Budget into Plan and Non-Plan categories, a distinction that was utilized until its abolition in the 2017-18 budget.
Public FinanceBudget Expenditure ClassificationUnion BudgetNon-Plan ExpenditurePlan ExpenditureDefence ExpenditureInterest PaymentsSubsidiesSalaries and Pensions