Honestly, this does not deserve a separate
post-at best a comment on the Firstpost page where this
article was published. But if you are a regular visitor on the
website (does it say something about me that I am?), you would know how the
regular commenters there are...how do I say it politely...moronic.
Anyway, the facts stated in the article are
accurate enough. That is, as Jagannathan notes, there has been a "...massive
transfer of fiscal implementation power to states in just one year. In P
Chidambaram’s last fiscal year (2013-14), states got Rs 1,19,039 crore out of
the Rs 4,75,532 crore plan outlays; this year (2014-15), they get a huge Rs
3,38,408 crore from the total plan kitty of Rs 5,75,000 crore."
Essentially,
there are two ways in which states can receive funds- Centrally sponsored
schemes (CSS) and Central Assistance to State and UT plans. CSS schemes come
with certain strings attached. Namely, states have to make proportionate
expenditure contribution to the scheme if they are to access CSS funds. On the
other hand, Central Assistance comes in two forms-Normal Assistance and
Additional Assistance. Additional assistance funds are scheme-based. However,
Normal Central Assistance are not tied to any specific schemes. Transfers to
states depend on the Gadgil-Mukherjee formula which uses criteria like
population, per capita income, fiscal discipline and special problems of the
state to determine how funds are to be transferred. Once received, states can
work with these funds in the manner that suits the state, on schemes that are
tailored to the states’ specific needs.
However, the
writer is being disingenuous when he says that,
"The
one-cap-fits-all approach of the UPA years, dictated by dynastic and
centralising feudal considerations, is now being whittled down by a former
state chief minister who is now prime minister."
In fact, the
almost three-fold jump seen in Central Assistance to State and UT plans (and a
corresponding decline in allocations under CSS as reflected by the Gross
Budgetary Support to States) under Jaitley's 2014-15 budget, mirrors the
allocations made by Chidambaram's interim budget of 2014-15. He, of the party
"dictated by dynastic and centralising feudal considerations". To be
fair, the budget document itself does not claim to reversing any trend of "de-federalising
a federalising trend that had begun earlier in the last decade". Rather,
it maintains that it is continuing with the restructuring of CSS, as suggested
by the B K Chaturvedi committee report.
Just goes to
show that media coverage needs to be taken with a heavy dosage of salt.
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