Explanation:

 Medium-term Expenditure Framework (MTEF) Statement

• It is a statement presented to the Parliament under Section 3 of the Fiscal Responsibility and Budget Management (FRBM) Act, 2003 and sets forth a three-year rolling target for the expenditure indicators with specification of underlying assumptions and risks involved.
• The objective of the MTEF is to provide a closer integration between budget and the FRBM Statements. This Statement is presented separately in the session next to the session in which Union Budget is presented, i.e. normally in the Monsoon Session.
• The MTEF is essentially a vertical expansion of the aggregates of the expenditure projections in the fiscal framework presented along with the Annual Financial Statement and the Demands for Grants. While the Medium Term Fiscal Policy (MTFP) lays down the fiscal constraints of the Government in medium term, Medium Term Expenditure Framework (MTEF) lays down the expenditure commitments for various sectors over a 3 years rolling framework.

Do You Know?

• The first Medium Term Expenditure Framework was laid in the Monsoon Session of Parliament in August 2013.
• The Fiscal Responsibility and Budget Management (FRBM) Act, 2003 was enacted with a view to provide a legislative framework for reduction of deficit, and thereby debt, of the Government to sustainable levels over a medium term so as to ensure inter-generational equity in fiscal management and long term macro-economic stability.