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1. Canon of Economy. No wastage should be associated with Public expenditure. It is essential that the public expenditure should not involve the use of resources more than, are just necessary. Utmost care must be taken to avoid wasteful public funds,
2. Canon of Sanction. This canon asserts that no public funds should be used without proper authorization and further that funds must be used only for the purpose for which they have been sanctioned. In a democratic set up, it is the legislature which sanctions the expenditure on demand by the executive authorities. The idea is that such a restriction would avoid unscrupulous and unwanted expenditure and will also be a check against misappropriation of funds.
3. Canon of Benefit. This is clearly related to the canon of economy. Actually economy of expenditure is a relative term and not an absolute one. Any expenditure is to be viewed against the benefits that will accrue from it. Canon of benefit also says that the public expenditure should be incurred only if it is for maximum social benefit. It should not to favor a small section of the community.
4. Canon of Surplus. This canon should actually be interpreted to mean that the government should avoid deficit budgeting, at least a persistent one. It should always try to be prudent and should aim at meeting its current expenditure needs out of its current revenue. It should not over-spend and run into a debt. Since it may not be possible to avoid some deficits, it would be better if the general effort is directed at achieving a moderate surplus. Such moderate surpluses during some years will take care of reasonable but unavoidable deficits during other years so on.
Judiesiz answered the question on July 7, 2018 at 00:38
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