Nitish Writes to Jaitley Raising Concern Over Devolution

Nitish wrote Jaitley expressing concern over devolution to the state over the next five years as per the 14th Finance Commission recommendations.

Published: 24th September 2015 07:29 PM  |   Last Updated: 24th September 2015 07:29 PM   |  A+A-

By PTI

PATNA: Bihar Chief Minister Nitish Kumar has written a letter to Union Finance Minister Arun Jaitley expressing concern over devolution to the state over the next five years as per the 14th Finance Commission recommendations, while thanking the finance minister for his "unwavering commitment" towards development of Bihar.

"I thank you for expressing an unwavering commitment of the Union Government towards overall development of Bihar and betterment of its people. However, a lot is desired in deeds, which, it seems, doesn't appear to be forthcoming," he said in a letter to the Union Finance Minister yesterday.

Claiming that the state government's concern over proposed devolution on the basis of 14th Finance Commission recommendations has not been assuaged, Kumar claimed Bihar had been let down by the horizontal distribution of funds under the divisible pool of resources as per the 14th Finance Commission recommendations.

"Statistically, it appears that the allocation recommended by the 14th Finance Commission out of the divisible pool is 136 per cent more than what was allocated by the 13th Finance Commission, but both the allocation figures are not comparable at all," the Chief Minister said.

The commission itself has noted that since there was little scope to increase the share of aggregate transfers from the Union Government to the states, all that it has done is to suggest compositional shift in the total transfers, Kumar said.

Elaborating, he said that as regards vertical distribution under the 13th Finance Commission, the size of the divisible pool of resources was 32 per cent of the net tax revenue receipts of the Union Government, but there were other transfers through grants-in-aid to the states.

Under the 14th Finance Commission, the divisible pool of resources has undoubtedly become larger at 42 per cent of the net tax revenue receipts of the Centre, but all other transfers to the states would be less which the Commission itself has noted, Kumar said and claimed that component-wise comparison of different transfer figures was bound to be misleading.

"We ought to compare only total transfers to the state. The impact of changes in vertical transfer patterns is similar in all states. But, whether the recommendations are fair to Bihar can be judged only by analysing the horizontal distribution pattern," the chief minister pointed out.

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