Odisha demands changes in 15th Finance Commission

Bhubaneswar: The State government today strongly opposed the Terms of Reference (ToR) of the 15th Finance Commission and stated that it may adversely impact devolution of resources to the state.

In a letter to Prime Minister Narendra Modi, Chief Minister Naveen Patnaik said that the flow of funds to the State will decline during the 15th Finance Commission if the Centre adopts 2011 census data as base.

He sought the personal intervention of the Prime Minister to ensure that the Finance Commission uses population data of the 1971 census instead of that of 2011 while making its recommendations.

“The Presidential order dated 27th November, 2017, on constitution and ToR of the 15th Finance Commission has made significant departures from the ToR of the previous Finance Commission, which may have adverse impact on horizontal devolution for Odisha as well as vertical devolution for states,” the Chief Minister wrote.

He said the main suggestions of the state government during the consultations prior to the notification of the Terms of Reference had apparently been ignored.

“On vertical devolution, the ToR seek to put fetters on the permit of the Commission. Instead of giving the freedom to the Commission to arrive at its recommendations on resource sharing between the Centre and states based on the respective needs and after due consultations, there are leading suggestions in the ToR indicating the overriding priorities and concerns of the Union Government,” he said.

“On horizontal devolution, the ToR make a radical departure by mandating the Commission to use population data of 2011 while making its recommendations,” he said.

Patnaik said the Terms of Reference for the 15th Finance Commission asking the use of 2011 census data was contrary to the National Population Policy Statements and the assurances to states which had actively implemented population stabilisation measures.

“It will have a huge adverse impact on our share in devolution as Odisha is already below the Population Replacement Rate of 2.1, indicating that we have stabilised our population. We demand that population data of 1971 census should be used by the 15th Finance Commission while making its recommendations,” said the Chief Minister.

“In many of the performance-based incentives indicated in the ToR, it may not be possible to have measurable indicators. Besides, there is no incentive for the states which have achieved the replacement rate of population growth. On the contrary, they will lose out as the population data of 2011 census will be used by the Commission unless the ToR are suitably amended,” he added.

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