Contingency fund

Contingency fund

A contingencies fund or contingency fund is a fund for emergencies or unexpected outflows, mainly economic crises.

Contents

History

In the early part of the nineteenth Century the Civil Contingencies Fund was created in the United Kingdom. It is held by the Treasury, and its use is regulated by the Miscellaneous Financial Provisions Act 1946[1]. It may be used for urgent expenditure in anticipation that the money will be approved by Parliament, or for small payments that were not included in the year's budget estimates.

The Contingencies Fund Act 1974 sets the size of the fund as two percent of the amount of the government budget in the preceding year.[2]

When Parliament votes to approve the urgent expenditure, the monies are repaid into the Contingencies Fund. As Parliament is effectively forced to approve actions ex post facto (after they've happened), the Treasury's use of the fund is actually scrutinised in detail by the Public Accounts Committee.

European Union

The European Union plans vast contingency fund, racing to contain crisis. [3]

Spain

In Spain, the contingency fund is used in economic crisis for public work and similar stimulus activities . There is social security contingencies fund called reserve fund, to pay pensions.

India

The Contingency Fund of India exists for disasters and related unforeseen expenditures.[4] In 2005, it was raised from 50 to Rs 500 crore.[5]

See also

Notes

  1. ^ http://www.statutelaw.gov.uk/content.aspx?LegType=All+Legislation&searchEnacted=0&extentMatchOnly=0&confersPower=0&blanketAmendment=0&sortAlpha=0&PageNumber=0&NavFrom=0&parentActiveTextDocId=1089598&ActiveTextDocId=1089598&filesize=16480
  2. ^ http://www.statutelaw.gov.uk/content.aspx?LegType=All+Primary&PageNumber=56&NavFrom=2&parentActiveTextDocId=1222914&ActiveTextDocId=1222914&filesize=7062
  3. ^ Schneider, Howard (10 May 2010). "Europe announces vast contingency fund, racing to contain crisis". The Washington Post. http://www.washingtonpost.com/wp-dyn/content/article/2010/05/09/AR2010050901146.html. 
  4. ^ "Government Account". Government of India. http://ccaind.nic.in/govtac_out.htm. Retrieved 20 April 2011. 
  5. ^ "Contingency fund limit raised to Rs 500 crore". TNN. 10 March 2005. http://articles.economictimes.indiatimes.com/2005-03-10/news/27506433_1_contingency-fund-finance-bill-appropriation-bill. Retrieved 20 April 2011. 

References



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