Rolling Plan (1978-1980)

MEANING OF ROLLING PLAN

When a plan is accompanied by recurring changes, it will create uncertainty on the part of both the private as well as public sector. Both the sectors will remain unsure of each other's responses. How the private sector will behave when the projections and targets of the plan vary every year? Moreover, how the government. sector will respond as a result of behavior of private sector in the changed situation? Thus the uncertainty attached with the plan will serve as an anti-thesis of planning. The uncertainty will evaporate the long term investment decision of the firm making the plan a no plan.


The rolling plans are objected on the round that they make the planners timid and coward. As rolling plans are adhered to revisions and modifications, hence the planners are always reluctant in taking difficult decisions or taking courageous decisions. Whenever the difficult situations rise, the easier course will be to revise the targets of the plan. If the plan is to be revised each year, then what is the need of planning?


The rolling plans are devoid of commitment to the plans or planning. The changing character of a plan is equivalent to mechanical projection exercises. As there is no fixity attached with the plans, the enthusiasm on the part of planning and administrative machinery will hardly be found. The will to perform plan tasks will be pre-empted right from the inception of the plan. The planning authority under such scheme of affairs will be reduced to a mere office of information collection and its dissemination.

Rolling Plan (1978-1980)


In the rolling plans there are three kind of plans. Number one is the plan for the current year which comprises the annual budget. Number two is a plan for a fixed number of years, which may be 3, 4 or 5 years. This number two plan is kept changing as per the requirements of the economy. Number three is a perspective plan which is for 10, 15 or 20 years. Thus there is no fixation of dates in respect of commencement and end of the plan in the rolling plans.
So the main advantage of the rolling plans is that they are flexible. They are able to overcome the rigidity of fixed five year plans by revising targets, projections and allocations as per the changing conditions in the country’s economy.
However if targets are revised each year, it becomes very difficult to achieve the targets which are laid down in the five year period. Frequent revisions make them, difficult to maintain right balances in the economy which are essential for its balanced development.
The rolling plans allow for revisions and adjustments. In rolling plans the review of a plan becomes a continuous exercise. The effect of changed circumstances and the changed demand and supply conditions can be incorporated in the plan.
No doubt in fixed plans, the annual reviews are made, but they are getting information regarding the progress of the economy. While in case of rolling plans, the yearly reviews are such a nature that they serve the basis for the revised new five year plan every year. Such yearly review is the essence of rolling plans.


In India the 6th five year plan (1978-83) by the Janta Government was called Rolling Plan which was discarded by the next Congress Government in 1980.


So far rolling plans have been unsuccessful in underdeveloped economies like Mexico and Myanmar and were later discarded, however in developed nations like Japan & Poland they have been successfully used.