Chief Minister Shri Naveen Patnaik wrote to Prime Minister Shri Narendra Modi seeking his personal intervention on the issue of Terms of Reference of 15th Finance Commission.
He has demanded use of 1971 Census population data by Finance Commission while making its recommendations instead of the newly mandated 2011 Census data. The ToR will adversely impact the horizontal and vertical devolution of Odisha, deprive it of performance based incentives and reduce state share in the divisible pool.
Issues raised by Chief Minister in the letter:
– On vertical devolution, the ToR prioritizes concerns of the Centre for resource sharing between state and centre, ignoring needs of the states
– On horizontal devolution, the ToR mandates use of population date of 2011 for its recommendations which is a radical departure from National Population Policy Statements based on 1971 Census. Grant-in-aid as well as other incentives are frozen at 1971 Census level through successful amendments, the last being the 84th Constitutional Amendment that extends the freeze till 2026.
– Use of the 2011 Census data will have adverse impact on state’s share in devolution as Odisha is already below population replacement rate of 2.1 as a sign of stabilized population
– Odisha has been demanding Special Category Status, continuation of Central schemes such as Special Plan for KBK, IAP for LWE districts etc and sharing pattern in Centrally Sponsored Schemes to be on par with North-Eastern and Himalayan states. None of these demands have yet been considered by Centre.
– Measurable indicators may not be possible for all performance based incentives indicated in the ToR. Also, no incentive for states which have achieved replacement rate of population growth.
Chief Minister Shri Patnaik urged Prime Minister Modi to address the issue of 15th Finance Commission’s ToR to ensure interests of Odisha and other states and there is no impact of the sharing in the divisible pool.