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Circulation of Revised formats of EFC/PIB Memorandum for Original Cost Estimates (OCE) and Revised Cost Estimates (RCE)
April, 11th 2014
                               F. No. 1(1)PF- II/2011
                                Government of India
                             Department of Expenditure
                             (Plan Finance-II Division)

                                                             North Block, New Delhi,

                                                              Dated: 31st March, 2014

                            OFFICE MEMORANDUM

Subject:     Circulation of Revised formats of EFC/PIB Memorandum for
             Original Cost Estimates (OCE) and Revised Cost Estimates (RCE).

       The existing EFC/PIB format was circulated vide O.M. of even no. dated 9 th
March, 2012. Since then, a number of suggestions have been received by this
Department regarding the provisions to be incorporated in the EFC/PIB memo. After
consultations with the Planning Commission and various Ministries / Departments, the
format has been revised in order to improve its functionality, incorporate evolving
policies and procedures and for better appraisal of proposals. Separate formats have
been prescribed for OCE and RCE proposals.

2.     Copies of the revised EFC/PIB format of OCE and RCE proposals are
circulated herewith for preparation of proposals for appraisal.

3.     Ministries / Departments are requested to present the proposals for appraisal in
the revised formats with effect from 1st April, 2014.


                                                                       (Saurabh Garg)
                                            Joint Secretary to the Government of India
                                                                     Tel no. 23093052



1.    Secretaries of all Ministries/Departments
2.    Financial advisors of all Ministries/Departments
3.    Advisor (PAMD), Planning Commission
                       Checklist for the RCE memo


               Particulars                              Indicate Y or N

Whether proposal has been prepared in the prescribed
RCE format.

Whether an Executive Summary has been attached.


Whether comments of Financial Advisor/IFD have
been attached with RCE Memo.

Whether feasibility report, if any, has been appended
with the RCE memo.

Whether report of Standing Committee to fix the
responsibility for cost and time overrun has been
appended with the RCE memo along with the action
taken report.

Whether a soft copy of the RCE Memo has been
attached.
                        Checklist for the EFC/PIB Memo

                                                              Indicate Y or N
                          Particulars


Whether proposal has been prepared in the prescribed
EFC/PIB format.

Whether an Executive Summary has been attached.


Whether ,,In-principle approval of the Planning Commission
has been taken and funding tied up.

Whether comments of Financial Advisor/ IFD have been
attached with EFC/PIB Memo.

Whether evaluation report if any has been enclosed with the
EFC/PIB memo.

Whether feasibility report, if any, has been appended with
the EFC/PIB memo.

Whether mandatory clearances / approvals have been
obtained.
Whether a soft copy of the EFC/PIB Memo has been
attached.
                                    No.----------------
                                 Government of India
                                Ministry/ Department of ---------------
                               (---------- Division)
                                                                  Date: ------------------

                     FORMAT FOR RCE MEMORANDUM

1.    Programme/project identification

1.1   Title of the programme/project.

1.2   Name of the sponsoring agency (Ministry/ Department/ Autonomous Body/
      Central PSE).

1.3   Duration of the programme/project.

a)    Original / latest approved

b)    Revised duration being proposed now

1.4   Total cost of the programme/project

a)    Original / latest approved

b)    Revised cost (RCE) being proposed now

2.    Programme/project Category

2.1   Please indicate which category the programme/project belongs to and the
      detailed reasons for the same:

(a)   Only time overrun.

(b)   Only cost overrun.

(c)   Both time and cost overrun.

3.    Programme/project Objectives and targets

3.1   The objectives of the programme/project may be mentioned.

3.2   The specific targets proposed to be achieved of the programme/project may be
      mentioned. These targets should be necessary measurable. These should also
      be monitorable, against baseline data. The baseline may be indicated. The
      targets should be in tabular form as shown below.
                                           Year                       Total
      Component      Year 1                Year 2 & so on         Physical Financial
                                                                  Total     Total
                     Physical Financial Physical Financial

      Component
      1
      Component
        2 & so on

3.2   The outcomes of the programme/project to be achieved should be indicated.
      These outcomes should be in the form of measurable indicators which can
      evaluate programme/project on quarterly/half yearly/annual/plan basis.

4.    RCE Details

4.1   The details about the initial outlays, subsequently revised outlays (including all
      previous RCEs sanctioned with amount / date and reasons) and the latest
      proposed outlays may be provided.

4.2   Details of physical progress achieved and expenditure incurred and commitment
      made so far may be given.

4.3   Date of latest approved, revised and proposed completion schedule of the
      project along with time overrun and reasons thereof may be elaborated.

4.4   Item-wise cost variation between approved (latest) cost and revised cost as
      proposed may be given in the format given below.

          S.no    Component      Originally Latest          RCE     Variation (+/-)
                                 approved approved
                                 cost       cost





4.5   Quantification and Reasons for change in cost may be given in the following
      manner:

(a)   Price Escalation

(b)   Foreign Exchange variation

(c)   Statutory levies

(d)   Change in Scope
(e)   Addition/ deletion

(f)   Under-estimation

(g)   Others (to be specified)

With reference to factors at (a), (b) & (c) above, indicate the consequential increase in
IDC, administrative expenses, etc., within the approved project time cycle (PTC) and
beyond.

4.6   If the change in cost is due to change in factors at 4.5(d) to (g), then provide the
      relevant information and the justification.

4.7 If the programme/project involves more land acquisition then indicate the name
     of the agency which is providing the land. If such land is to be acquired then
     resettlement/rehabilitation cost may be provided.

4.8   Effect of revision in capital cost estimates on cost of production and
      profitability / viability with reference to earlier approved capital cost of the
      project.

4.9   Report of Standing Committee to fix the responsibility for cost and time overrun
      along with action taken report on its recommendations may be appended with
      the RCE memo.

5.    Plan provisions and funding

5.1   Revised phasing of expenditure and source of funding

5.2   Details regarding the change in funding pattern, along with justification

5.3   Availability of Plan outlay in FYP / Annual Plan may be indicated

6.    Approvals

6.1 Please indicate the specific points of RCE memo on which approval of EFC / PIB
     is sought.



                                                                     (-------------------)
                                         Joint Secretary to the Government of India
                                                               Tel. No.____________
                                                               Fax No.____________
                                                E-mail_________________________
                                     No.----------------
                                   Government of India
                           Ministry/ Department of ---------------
                                    (---------- Division)

                                                                     Date: ------------------

                     FORMAT FOR EFC/PIB MEMORANDUM

1.    Proposal identification

1.1   Title of the proposal.

1.2   Name of the sponsoring agency (Ministry/ Department/ Autonomous Body/
      Central PSE).

1.3   Proposed duration of the proposal/Scheme.

1.4   Total cost of the proposal over the proposed duration.

1.5   Nature of scheme: Central Sector/ Centrally Sponsored/Additional Central
      Assistance

2. Proposal Category

2.1   Please indicate which category the proposal belongs to:

(a)   Continuing scheme from past Plan periods and included in current Plan period.

(b)   New Plan Proposal included in the current Plan period

(c)   New Plan Proposal not included in the current Plan period

2.2   If proposal pertains to category 2.1 (a), then please indicate the benefits already
      accrued and expenditure already incurred.
2.2(a) Also for proposals belonging to category 2.1 (a),an evaluation report by an
      independent agency with comments of FA/IFD thereon may be provided along
      with following details as Annexure to EFC/PIB memo:

      Commencement      Name of         Details of Independent Evaluation
      of Scheme &       Evaluating                   Major      Main
      Year of           Agency       Methodology     Findings Recommendations
      Evaluation
                                      Sample
            Year                      size
            Month
                                      Data
                                      Source

                                      % of
                                      Coverage

                                      Parameters
                                      of
                                      Evaluation

2.2(b) If there are changes proposed in the proposal belonging to category 2.1(a),
      please provide existing provisions and proposed changes against each
      component in tabular form along with financial implications due to the
      proposed changes:

  Existing  New/      Changes              Reasons for    Financial     Financial
  Component Revised   proposed in          changes in     Implication   implication of
            Component Existing             existing       in the last   addition/change
                      Components           components     Plan          to proposal
                                           and addition
                                           of new
                                           components
  Component
  1
  Component
  2
  Component
  3 and so on

2.3    If the proposal pertains to category 2.1 (c), please indicate whether in-principle
       approval of Planning Commission has been obtained.

2.4    Please indicate in case of new Centrally Sponsored Scheme or Major change in
       ongoing CSS, whether States/UTs have been consulted and their consent
       obtained to implement the scheme with proposed sharing of funds.
3.      Justification for the Proposal

3.1     The justification for taking up new/ continuing the ongoing proposal may be
        provided in terms of:

i)      Demand and supply analysis to identify gaps.

ii)      Conformity with the Plan Priorities and National objectives

iii)    Problems to be addressed at local/regional/national levels, as the case may be,
        through scheme/project.

3.2     The alternatives that have been considered before firming up the design of the
        proposal may be stated. (This should also include alternate modes of proposal
        delivery, e.g. outsourcing, PPP, etc. that have been considered).

3.3     Please state whether the proposal has objectives and coverage which overlap
        with projects/ schemes being implemented by the same or another agency
        (Ministry/ Department/ State government). In cases of overlap, please state
        why the proposal needs to be considered as a separate stand alone effort.

4.      Proposal Objectives and targets

4.1     The objectives of the proposal may be mentioned. These objectives should flow
        from the proposal justification.

4.2     The specific targets proposed to be achieved of the proposal may be mentioned.
        These targets should be necessarily measurable. These should also be
        monitorable, against baseline data. The baseline may be indicated. The targets
        should be in tabular form as shown below.
       Component                    Year                                   Total
                           Year 1                   Year 2 & so on     Physical    Financial
                                                                       Total       Total
                       Physical     Financial   Physical   Financial

       Components
       1,2,3 & so on


4.3     The outcomes of the proposal to be achieved should be indicated. These
        outcomes should be in the form of measurable indicators which can evaluate the
        proposal on quarterly/half yearly/annual/plan basis.

4.4     Briefly explain the objectives of the other programmes/projects undertaken by
        Ministry/Dept which are in convergence with the objectives of proposed
        proposal.

4.5 Please indicate whether the proposal is for current Plan only or will continue in
     next Plan also.
5.    Gender Analysis of the Proposal

5.1   Briefly explain the specific objectives of the proposal relating only to women.

5.2   In case the proposal has gender components, please provide the following
      information in tabular form as shown below.

            Gender Component                % of total expenditure on this
                                            component

            Component 1, 2,3 & so on

6.    Proposal design

6.1   Briefly explain the proposal Design. This should include all components of the
      proposal including:

i.    Scope of the project

ii    Assumptions used

iii   Technology

iv.   Size/ Specifications/ Layout Plan

v.    Plant & Machinery

vi.   Others (Please specify)

      The components of the project should be carved out from the Feasibility
      Report/Project report. The study/ investigations on which project parameters are
      based should be clearly indicated.

6.2   In case the proposal is specific to any location, area and segment of population
      please state the basis for selection. Details regarding special physical features,
      technology, etc., may be given.

6.3   Please indicate whether the proposal is secured against natural/ man-made
      disasters like floods, cyclones, earthquakes, tsunamis, etc. If the proposal
      involves creation/ modification of structural and engineering assets or change in
      land use plans, disaster management concerns should be assessed.

6.4   In case of beneficiary oriented proposal, the mechanism for identification of the
      beneficiary and the linkage of beneficiary identification with UID numbers, on a
      voluntary / non-mandatory basis, may be indicated.
6.5     Wherever possible, the mode of delivery should involve the Panchayati Raj
        Institutions and Urban Local Bodies. Where this is intended, the preparedness
        and the ability of the Panchayats for executing the proposal may be indicated. If
        exceptions are to be made, the reasons may be explained.

6.6     Whether the land required for the proposal is in possession of the agency. In
        case the proposal involves land acquisition or environmental clearances, the
        specific requirements and the status in this regard may be indicated.

6.7     The legacy arrangements after the scheduled proposal duration may be
        mentioned. In case the proposal creates assets, arrangements for their
        maintenance and upkeep may be stated. (For example the proposal assets may
        be taken over and maintained by the State Government/ PRIs, ULBs).

6.8     Please indicate:

      Inter-linkages with other schemes mainly in terms of coverage, impact, outcomes,
      etc.

      Steps taken towards convergence with other schemes to achieve the intended
      outcomes may also be stated.

      Steps taken towards convergence in flow of funds from other schemes.

7.      Proposal cost

7.1     Please provide the proposal cost estimate for its scheduled duration along with a
        break-up of year-wise, component-wise expenses segregated into non-recurring
        and recurring expenses.

7.2     In case the land is to be acquired, the details of cost of land and cost of
        rehabilitation/resettlement may be provided.

7.3     Estimated expenditure on proposal administration (including expenses on
        consultants, monitoring, evaluation, IEC, etc.) may be separately indicated.

7.4     The basis of these cost estimates along with the reference dates (it should not be
        more than six months old) for normative costing may be provided. Please
        indicate the firmness of the estimates, component wise, with the extent (+ / -) of
        the expected variation.

7.5     In case the proposal involves payout of subsidy, the year wise and component
        wise expected outgo, up to the last year of payout, may be indicated.

7.6     In case the proposal intends to create capital assets, employ specialised
        manpower or involves other activities that necessitate a Recurring Cost of
        Capital Expenditure (RCCE) (e.g., maintenance and upkeep costs of assets,
      salary costs of manpower, etc.) over the lifetime of the asset, such expenditures,
      on an annual basis, may be indicated in the proposal.

7.7   It may also be stated whether the agency which would be assigned this legacy
      responsibility has been consulted and has agreed to bear the continuing
      recurring expenditure. (e.g., the State governments may need to incur the
      maintenance and upkeep costs of assets created under Plan schemes).
7.8   The cost towards salary/ fees/ emoluments of the proposal human resources as
      being proposed should be indicated (procedure for seeking approval for human
      resource requirements is detailed at para-9 below).

7.9   The component of the costs mentioned at 7.1-7.8, that will be shared by the
      state governments/PRI/User Beneficiaries may be indicated.

7.10 In the event of fund transfer being made to State Govts/ local bodies or other
     organisations, "grants for creation of capital assets" may b e indicated
     separately.

8.    Proposal: Financing

8.1   The source of financing for the proposal may be indicated. In case of proposal
      already included in the FYP, the specific earmarking may be mentioned.

8.2   Whether the funding requirements have been fully tied up with Planning
      Commission may be indicated. The quantum of the Plan allocation may be
      indicated.

8.3   If there are gaps in the financing of the proposal, the sponsoring agency may
      indicate how such gaps in FYP as well as the Annual Plans will be addressed.

8.4   If external sources are intended, the sponsoring agency may indicate whether
      such funds have been tied up. In case firm commitment is not available,
      alternative plans for arranging funds may be indicated.




8.5   In case of partial allocation of funds for the proposal, then the components
      which may be removed/reduced may be indicated.

8.6   Please provide the following details in respect of project proposal:

      Debt-equity ratio along with justification.

      In case of, funding from internal resources (IR), availability of IR may be
      supported by projections and their deployment on various projects.

      Please indicate funding tie-ups for loans components both domestic and foreign,
      along-with terms and conditions of loan based on consent/ comfort letters.
9.    Proposal: Human Resources

9.1   In case posts (permanent or temporary) are intended to be created, a separate
      proposal may be sent on file to Personnel Division of Department of
      Expenditure. Such proposals may be sent only after the main proposal is
      recommended by the appropriate appraisal body (SFC, EFC, etc.).

9.2   In case outsourcing of services or hiring of consultants is intended, brief details
      of the same may be indicated. It may also be certified that the relevant GFR
      provisions will be followed while engaging the agency/ consultant.

9.3   In case additional manpower requirement, please indicate the phased
      requirement over the proposal timeline (i.e. year-wise break-up of the
      manpower requirement)

10.   Proposal viability

10.1 In case of proposals which have identified stream of financial returns, the
     financial internal rate of return may be calculated. The hurdle rate is considered
     at 12%.

10.2 In case of proposals where financial returns are not readily quantifiable
     (typically social development proposals), the measurable benefits/ outcomes
     may be indicated.

11.   Proposal implementation and monitoring

11.1 Implementing agency (s) may be indicated.

11.2 The administrative structure for implementing the proposal may be stated.
     Usually new structures/ entities, etc. Are, by and large, to be avoided. In case
     new structures are intended to be created for administering the scheme, the
     details of such structures and specific justification for the same may be
     provided. Such new structure should be proposed only if it is has been
     established after due analysis, that existing structures cannot be levered for the
     proposed/additional work.

11.3 The completion schedule of the proposal indicating timelines of activities
     should be provided in PERT/Bar Chart along with critical milestones.

11.4 Mode of implementation: Departmental/ Contract/ Turnkey contract/ EPC/
     PPP, etc. with justification may be given.

11.5 Nodal officer identified / appointed for being directly in charge and overseeing
     progress of the proposal may be indicated. Details about his status, past
     experience in executing similar proposals and balance tenure left for steering the
        proposal may also be mentioned. He/ She should normally be appointed for
        entire duration of the proposal.

11.6 The monitoring framework preferably on MIS for the proposal may be
     indicated. The arrangements for audit/social audit of the proposal may also be
     stated.

12.     Proposal sensitivities/uncertainties

12.1 Any foreseeable constraints/ uncertainties which can affect the technical design,
     costing and implementation of the proposal may be indicated.

12.2 The likely impact of these constraints/uncertainties on the proposal parameters
     may be stated. In particular, the sensitivity of the proposal cost, proposal
     schedule and proposal viability towards the possible constraints/ uncertainties
     may be mentioned.

13. Mandatory approvals / clearances:
  The details regarding the requirement of mandatory approvals / clearances of
  various local, state and national bodies and their availability may be indicated in a
  tabular form

      S.No   Approvals / Clearances   Agency concerned            Availability (Y/N)


14.     Consultations with the Public, State Governments, External Research
        Agencies, Think Tanks, etc.

14.1 To the extent possible and practicable, such consultations may be done by the
     Administrative Ministries. The draft Proposals may be placed on the web site of
     the sponsoring Ministries and comments invited from the general public. The
     draft proposals may be formulated / finalized taking into account such
     comments. Details in this regard may be indicated in the EFC /PIB memo.

15. Concurrence of Financial Advisor
15.1 Comments/Concurrence of Financial Adviser may be indicated along with reply
     of the Administrative Ministry.
16. Approvals:

16.1 Please indicate the specific points on which approval of EFC / PIB is sought.


                                                                     (-------------------)
                                         Joint Secretary to the Government of India
                                                               Tel. No.____________
                                                               Fax No.____________
                                                E-mail_________________________

 
 
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