Southern states to chalk out action plan

Suresh Dharur

Tribune News Service

Hyderabad, April 24

Amid concerns over the “adverse impact” of the terms of reference of the 15th Finance Commission, the Andhra Pradesh Government will host the second round of Finance Ministers’ conclave in Vijayawada on May 7 to firm up a joint action plan.

The first such conference of Finance Ministers of southern states was held in Thiruvananthapuram on April 10 where concerns were raised over the “skewed” terms of reference, particularly the proposal to take the 2011 Census as the basis for fixing the share of central taxes for the states.  

The members felt that such a yardstick would amount to penalising the southern states which have performed well in population control and other social indicators. The meeting also demanded amendments to the terms of reference in the interest of equitable distribution of central taxes among the states.  

Andhra Finance Minister Y Ramakrishnudu pointed out that several states were already under stress on account of the double whammy impact of demonetisation and the GST. He said the 15th Finance Commission could be another setback as its terms of reference indicated the Centre could “take away more powers” from states.

“The spirit of federalism is being damaged, despite the Finance Commission being an independent body under the Constitution,” he said.

The proposed meeting is the first attempt by the Chandrababu Naidu-led TDP to rally the states since its exit from the NDA government over denial of special status. 

The CPM, at its 22nd party congress recently in Hyderabad, had termed the terms of reference as “anti-federal” and accused the NDA government of trying to use the Finance Commission to “further centralise financial powers”.

“The loss to southern states itself will be to the tune of Rs 80,000 crore. States, such as Odisha and West Bengal, will also stand to lose if 2011 is taken as the base year for population,” the Kerala Finance Minster had said after meeting his Andhra counterpart in Vijayawada.

There is an attempt by southern states to mobilise support for amendments to the ToR of the 15th Finance Commission and act as a pressure group.

They contend that the terms of reference would only help states which had no discipline in population control while those which took strict measures on birth control would end up as losers as the commission had been told to take the 2011 Census as basis instead of the 1971 Census.