The General Financial Rules have undergone significant changes this past month, with new norms and amendments implemented by the Ministry of Finance. For official documentation, refer to the Ministry of Finance’s notification.
The amended General Financial Rules introduce higher monetary thresholds, increase accountability and transparency, and emphasize the role of the GeM Portal and Central Public Procurement Portal. Update yourself with the clear amendments in the General Financial Rules 2017 through this quick guide, which compares and explains all the revisions
Key Amendments in the General Financial Rules
The following table outlines the key revisions for easy reference and quick understanding.
Rule 133:
| Existing | Revised |
| Ministries or Departments can execute repair works up to ₹30 Lakhs directly. | The bar for repair work by Ministries/Departments has been raised to ₹60 Lakhs. |
| They can assign repair works above ₹30 Lakhs to Public Works Organizations (PWOs) or specified government entities like the Ministries of Railways, Environment and Forests, etc. | Assignments to PWOs and government entities now apply to works above ₹60 Lakhs. |
| A ministry can award repair works estimated to cost above ₹30 Lakhs. | A ministry can award repair works estimated to cost above ₹60 Lakhs. |
| The rest of the factors remain the same. | The rest of the factors remain the same. |
Rule 139:
| Existing | Revised |
| Works costing between ₹5 Lakhs to ₹30 Lakhs were eligible for open tenders. | Open tenders are eligible for works costing ₹10 Lakhs to ₹60 Lakhs. |
| Limited tenders were required for works costing less than ₹5 Lakhs. | Limited tenders are required for works costing less than ₹10 Lakhs. |
Rule 149:
No significant changes have been made to the procurement mandate through the Government e-Marketplace (GeM) for items listed on the portal. Direct online purchases remain allowed up to ₹25,000.
| Existing | Revised |
| Tools for online bidding and online reverse auction on GeM were available even for procurements less than ₹5 Lakhs. | It is now possible to use online bidding and reverse auctions for procurements of less than ₹10 Lakhs. |
| Previously, for purchases between ₹25,000 and ₹5,00,000, orders had to be placed with the lowest price supplier available on GeM. | Conditions for procurement: – From at least three different manufacturers – Should meet the requisite quality, specification, and delivery period |
Rule 154:
| Existing | Revised |
| The bar for purchasing goods without inviting quotations or bids was ₹25,000. | The bar for purchasing goods without inviting quotations or bids has been increased to ₹50,000. |
| The compulsion for authorities to issue a certificate remains unchanged to ensure that the goods purchased are at par with the competent quality and specifications and that the prices are reasonable. | The format for this certificate is as follows: “I am personally satisfied that these goods purchased are of the requisite quality and specification and have been purchased from a reliable supplier at a reasonable price.” |
Rule 155:
| Existing | Revised |
| The bar for purchasing goods by the Local Purchase Committee was from ₹25,000 up to ₹2,50,000 on each occasion. | The bar for purchasing goods by the Local Purchase Committee has increased to ₹50,000 and up to ₹5,00,000 on each occasion. |
| The purchase order was made on the recommendations of the Local Purchase Committee, whose role is to survey the market to judge the suitability of the rate, quality, and specifications and identify the appropriate supplier. | This procedure remains the same in the new General Financial Rules Amendment as well. |
Rule 161:
| Existing | Revised |
| ₹25 Lakhs and above can be used for procurement of goods through invitation to tenders by advertisement. | ₹50 Lakhs and above can be used for procurement of goods through invitation to tenders by advertisement. |
| Advertisements for such cases should be published on the Central Public Procurement Portal (CPPP). | Organisations with their own websites should also publish all advertised tender inquiries. |
Rule 162:
| Existing | Revised |
| Limited tender inquiry can be adopted if the estimated value of goods to be procured is less than ₹25 Lakhs. | Limited tender inquiry can be adopted if the estimated value of goods to be procured is less than ₹50 Lakhs. |
| A minimum of three suppliers still need to be identified for sending the bids. | The Purchase Committee must continue to record the reasons for adopting this mode and the process of selection of suppliers. |
Rule 173:
| Existing | Revised |
| No member of a purchase committee should report directly to any other member in case the estimated value of procurement goes past ₹25,00,000. | No member of a purchase committee should report directly to any other member in case the estimated value of procurement goes past ₹50,00,000. |
| This rule is an effort towards transparency, competition, fairness, and elimination of arbitrariness in the procurement process. | This remains unchanged in the General Financial Rules Amendment. |
Rule 183:
| Existing | Revised |
| The cost of consulting services was ₹25,00,000. | The cost of these consulting services has been raised to ₹50,00,000. |
| For consulting services estimated to cost more than ₹25,00,000, an open advertisement to invite Expression of Interest (EOI) should be published on the Central Public Procurement Portal (CPPP), the GeM Portal, departmental website, and in a national newspaper. | For consulting services estimated to cost more than ₹50,00,000, an open advertisement to invite Expression of Interest (EOI) should be published on the Central Public Procurement Portal (CPPP), the GeM Portal, departmental website, and in a national newspaper. |
| The Ministry/Department can choose a consultant after inviting offers from at least three consultants. | This remains unchanged in the General Financial Rules Amendment. |
Rule 201:
The following existing guidelines have no change:
- Every officer incurring or authorising expenditure from public funds should be guided by high standards of financial propriety.
- The expenditure should not be prima facie more than the occasion demands.
There are two additional clauses added:
- Before incurring any expenditure, the officer should ensure that funds are available, and the expenditure has been sanctioned by an authority.
- Every officer should also ensure that the expenditure conforms to the relevant provisions of the Constitution and laws made as well as to the financial rules and orders issued by the authority.
Rule 218:
| Existing | Revised |
| Surplus or obsolete or unserviceable goods of assessed residual value above ₹2,00,000 should be disposed of by: – Obtaining bids through advertised tender – Public auction | Surplus or obsolete or unserviceable goods of assessed residual value above ₹4,00,000 should be disposed of by: – Obtaining bids through advertised tender – Public auction |
Wrapping Up: What’s Changed in the General Financial Rules?
Here’s a quick recap to keep you in the loop with the key updates:
- Raised Thresholds: The procedures now reflect higher costs for tendering processes.
- Consulting Services: There is a greater emphasis on using online platforms like the GeM Portal and Central Public Procurement Portal (CPPP) for advertising tenders and EOIs.
- Transparency and Fairness: Stricter rules have been implemented to reduce unwanted reporting within purchase committees and ensure unbiased procurement processes.
- Accountability Measures: New measures have been introduced for accountability in case of financial mismanagement or misuse of funds
