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.

1. 1 only
2. 2 and 3 only
3. 1, 2, 3 and 4
4. None

Explanation

All options are correct

• Budget documents classified total expenditure into plan and non-plan expenditure. According to this classification, plan revenue expenditure relates to central Plans (the Five-Year Plans) and central assistance for State and Union Territory plans. Non-plan expenditure, the more important component of revenue expenditure, covers a vast range of general, economic and social services of the government. The main items of non-plan expenditure are interest payments, defence services, subsidies, salaries and pensions.
• Note: In 2016, the Government of India announced the abolition of the classification of plan and non-plan expenditure. From 2017-18 onwards, government expenditures have been reclassified into Capital and Revenue expenditure.

Answer: (c) 1, 2, 3 and 4; Difficulty Level: Easy