CM holds meeting on 15th Finance Commission

The Tamil Nadu government, which stayed away from the southern Finance Ministers’ conclave in Thiruvananthapuram on Tuesday, held a meeting chaired by Chief Minister Edappadi K. Palaniswami to discuss possible adverse effects that the State would face due to the 15th Finance Commission.

A week ago, Mr. Palaniswami wrote to Prime Minister Narendra Modi, Union Finance Minister Arun Jaitley and chairman of the Finance Commission N. K. Singh, expressing reservations over some aspects of the terms of reference of the Finance Commission and seeking amendments to the terms. “We are going to reiterate our position shortly,” Fisheries Minister D. Jayakumar, one of the participants of the meeting and the State’s representative at the GST (Goods and Services Tax) Council, told The Hindu later in the day.

Deputy Chief Minister O. Panneerselvam and Ministers K.A. Sengottaiyan, Dindigul C. Sreenivasan, S.P. Velumani and C.Ve. Shanmugam also took part in the meeting during which Additional Chief Secretary (Finance) K. Shanmugam explained various issues to them and the Chief Minister.

The grouse of the State is that if the 2011 population data were to be taken as the basis for devolution of funds, the State would stand to lose heavily as it has made rapid progress in population control in the last 40 years and its performance would not be rewarded. Rather, the State would be penalised.

Beyond panel’s purview

As for taking a critical view on the “populist schemes,” the State questions such a description and argues that any welfare scheme can be branded as a populist scheme. Besides, an “administrative body” such as the Finance Commission cannot and should not encroach upon the domain of legislature, which eventually decides on the implementation of welfare schemes in States, a senior official says. As for the status of implementation of the Centre’s flagship schemes, the State’s view is that some of the schemes are of no relevance to Tamil Nadu. For instance, the ‘Saubhagya’ scheme is meant for rural electrification. The State cannot avail itself of the scheme as it has been declared fully electrified, the official points out.

At the same time, the official adds that it is premature to arrive at any figure of loss that the State may suffer, assuming that the present terms of reference underpins the Finance Commission’s recommendations for devolution of funds.