Surplus Budget

Surplus budget refers to that budget in which the government receipts are more than the government expenditure. Surplus budget reduces govt. liabilities or increases the contingency fund.

Surplus budget checks inflationary pressure. Unproductive and unnecessary govt. expenditure are checked because of the surplus budget. The classical economists were the champions of surplus budget. But today surplus budget is not found any where in the world. Only on abnormal circumstances like post war hyperinflation, surplus budget can be used as an effective instrument to control it.