The 15th Finance Commission ruled out any injustice to any state or states in the allocation of divisible pool of central revenues and asserted that the North-South debate being sought to be raised in the matter is unfounded.
The Commission’s stand in this regard was stated at a meeting of its Chairman and members with the Vice President of India M Venkaiah Naidu in New Delhi on Friday.
“As Chairman of the Council of States I thought it would be appropriate to talk to you about the principles followed by various commissions in the recent past and your thinking in the current context,” the Vice President said.
He also brought to their notice some reports about reservations of some States on some aspects of the Terms of Reference of the Commission and some even suggesting a North-South perspective.
The Terms of Reference of the Commission, their implications and broad approach likely to be followed by the Commission were discussed at length during the one hour long meeting.
Chairman of the Commission NK Singh and the members informed Mr. Naidu that ensuring macro-economic stability of the country, rewarding States for their past performance besides incentivising future performance, specific needs of the States and the Centre, right of citizens for equal entitlements would broadly guide the Commission’s approach to determining the allocation of revenues between the Centre and States and among the States.
“The Terms of the Reference was only a broad guidance and the Commission is at liberty in finalising the specific criteria and weightages for each of the parameters, after discussions with the States,” NK Singh said.
Elaborating further, he said the 14th Finance Commission was asked to go by the 1971 Population Census but it took into consideration the 2011 Census, there by rewarding those who did well in population control.
Meanwhile, Vice President Naidu suggested to the Commission to further the cause of economic unity and integration of the nation, performance, reforms, specific needs of the States and the Centre and the problems of farm sector within the ambit of the Terms of Reference of the Commission.
He also stressed that the commission should do needful to make agriculture sustainable through appropriate recommendations and resources for promotion of necessary infrastructure.
The Commission members said successive Finance Commissions have been guided by the need to address the issues and challenges of the time resulting in evolving perspectives and it would be the same with 15th Finance Commission.
The Commission is to submit its Report on determining the transfer of revenues and allocation of Grants-in-Aid of revenues of the States by April 1,2019. The recommendations of the Commission will be applicable for the period 2021-22 to 2022-27.