Kerala to host meeting of southern states against 15th Finance Commission terms

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THIRUVANANTHAPURAM : Kerala Finance Minister Thomas Issac has persuaded other southern states to join hands against the terms of reference of the 15th Finance Commission (FC) that are seen as hampering the prospects of states that have kept a check on population growth.

The matter will be discussed at a day-long meeting, to be held in the state capital on Tuesday, in which ministers and officials from the other states would also participate.
"The policy of sharing central funds with states was hitherto done based on the 1971 census. Now the 2011 census will be taken, and if that happens, Kerala -- as well as a few south Indian states -- would be the worst affected as our population growth was just 56 per cent as compared to 150 per cent in certain states in the country.
"If 2011 is going to be used, Kerala will lose Rs 20,000 crore in five years, while Tamil Nadu stands to lose Rs 40,000 crore," said Issac. All BJP-ruled states -- Uttar Pradesh, Rajasthan, Bihar and Madhya Pradesh -- will gain, he added.
Issac said the states should be given the freedom to decide on what they need and not be dictated to.
"We have no issues regarding the composition of the 15th FC as we do not wish to take on personalities. Instead, we should be given the freedom to decide what we need," the economist-turned-politician said.
"When I spoke to my counterparts in south India, all of them, with the exception of Telangana, have confirmed their participation in the day-long meeting to be held here tomorrow," he added.
The meeting would be inaugurated by Chief Minister Pinarayi Vijayan. "Every state will be allowed to present their case and, at the end of the day, there could well be a joint communique," said Issac.
Issac added that, hitherto, it was the Planning Commission that decided on the state's share from the central pool with regards to allocation under the plan expenditure, while the FC dealt with non-plan expenditure.
"Now that the Planning Commission does not exist, everything is clubbed into one figure -- including grants given by the Centre; then saying the state's overall share has grown from 32 per cent till now to 42 per cent, is misleading.
"Also it's not right for the FC to determine populist schemes, as it's the right of the state government; it's a political decision that has to be taken while determining populist schemes," added Issac.
Echoing similar fears was the Kochi-based Centre for Socio-economic and Environmental Studies, whose head K.K. George said that the turf of the constitutional body had been encroached upon to a large extent by the Planning Commissions in the past and off late by the Niti Aayog.
"The fault for allowing this encroachment lies partly with the successive Finance Commissions, which abdicated their constitutional responsibilities and limited their roles, on their own, presumably in tune with the wishes of the central government.
"This is particularly so in the case of the present FC. There is no representative in FC15 who is familiar with state finances. All of them, except one, are connected with central government bodies like the Niti Aayog," said George, adding that the major gainers if Census 2011 is used would be Uttar Pradesh, Rajasthan, Bihar and Madhya Pradesh.

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