15th Finance Commission unfair to Southern States: Andhra Pradesh Finance Minister Yanamala Ramakrishnudu

Accuses Union government of mounting pressure on panel to help North Indian States, finds fault with cut in subsidies for programmes meant for the poor.

Published: 02nd April 2018 05:47 AM  |   Last Updated: 02nd April 2018 05:47 AM   |  A+A-

By Express News Service

VIJAYAWADA: State Finance Minister Yanamala Ramakrishnudu has said that Terms of Reference (ToR) of the 15th Finance Commission are detrimental to Southern States.
In a press release here on Sunday, Ramakrishnudu said the Southern States would stand to lose substantial percentage of their revenues, but at the same time revenue share of the Centre would increase.
 Further, more weightage was recommended for non-performing States in the Central tax share.
“We object to the omission of the Special Category Status (SCS) to Andhra Pradesh in the ToR of the 15th Finance Commission,” he said

He took serious exception to the Finance Commission being authorised to decide on the percentage of financial devolutions and grants-in-aid, taking 2011 Census as the basis for Central assistance, increase in Goods and Services Tax (GST) and a decrease in subsidies for programmes meant for the poor.
“Going by the Central Government’s attitude, it appears that it wants to bring pressure on the Finance Commission, which is an autonomous body, to help North Indian States. The ToR of the latest Finance Commission proves this point,” he said.  

Ramakrishnudu found fault with the Central government for not discussing the issue with the State governments before finalising the ToR of the 15th Finance Commission.
 “Taking unilateral decisions on such important issues is not proper on the part of the Central government,” he said.

Criticising the Central government for reducing the subsidies to programmes meant for the poor, he said it only shows the Central government’s lack of concern for the underprivileged.
He said, at the Southern States Finance Ministers’ Conference to be held in Thiruvananthapuram (Kerala) on April 10, all issues, particularly those related to AP  would be discussed.  

The Finance Minister said the 14th Finance Commission, on the one hand, claims that financial devolution from the Centre to States has been increased from 32 per cent to 42 per cent and on the other, it has changed the ratio of Central assistance to some Centrally-sponsored programme from 90:10 to 60:40, which has placed a 30 per cent additional burden on the States.

He said by accepting the 14th Finance Commission’s recommendations, the States are getting 2-4 per cent less revenue from the Union government  when compared to the share allocated in the 13th Finance Commission.

“We have asked for the revenue deficit to be calculated for the period before 14th Finance Commission but there was no response from the Centre,” he observed.

Meanwhile, former chief secretary IYR Krishna Rao did not agree with the North-South divide being projected by a few political leaders in the State.

“The problem is with the Terms of Reference of the 15th Finance Commission, which uses 2011 Census data for the purpose of devolution. It would be unfair to the States which have implemented effective population control initiatives if 2011 Census data is used as against the 1971 Census data.
This is where the issue lies, but not the North-South discrimination as is being made out by some leaders,” he said.

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