Registering the State’s protest over some of the recommendations of the 14th Finance Commission, Tamil Nadu Chief Minister Edappadi K. Palaniswami said on Sunday that the State has been “badly affected”, as its horizontal share has declined by almost 20%, effectively nullifying the increase in the vertical share.
Speaking at the 3rd Governing Council Meeting of NITI Aayog in Delhi on Sunday, Mr. Palaniswami said, “The situation has been exacerbated by the increasing tendency of the Government of India to levy cesses and surcharges on various Central taxes which keeps such receipts out of the devolution pool. Hence, meeting the increased State share of 40% for Centrally sponsored schemes is a challenge for Tamil Nadu.”
The State’s share of funds was increased to 40% uniformly for all core schemes on the ground that the devolution to States was increased to 42% by the 14th Finance Commission.
“Even more challenging” was the underfunding in the Union Budget for certain crucial schemes such as the Post Matric Scholarship Scheme for Scheduled Castes, Sarva Siksha Abhiyan (SSA) and the Rashtriya Madhyamik Siksha Abhiyan (RMSA). Tamil Nadu has a total pending release of ₹1,862 crore under the SSA and RMSA up to March 31 this year.
“This is very unfortunate considering that the Government of India levies Education Cess on various taxes specifically to fund the schemes,” he said, and contended that it had adversely affected the fiscal health of the State.
The allocation of funds for agriculture, rural drinking water supply and poverty reduction too was “meagre”, he said, and urged the Centre to step up budgetary allocations for these priority areas to ensure maximum impact.
GST impact
He said that the Tamil Nadu GST Bill would be placed before the State Legislative Assembly shortly.
The Chief Minister further remarked that even within the existing GST framework, the quantum of funds required for compensating the States could be much higher than what was originally contemplated.
Observing that Tamil Nadu was suffering from one of the worst droughts in several decades, he contended that it was important that the legitimate grievances of farmers received sympathetic consideration from the Centre.
As Tamil Nadu was dependent on inter-State rivers for meeting both irrigation and drinking water needs, the CM reiterated the demand for immediate establishment of the Cauvery Management Board and the Cauvery Water Regulation Committee. Holding that the long-term solution to ensure equitable sharing of water resources was inter-linking of rivers, he called for nationalising all inter-State rivers.
The insurance claims for 2016-17 had to be settled by the insurance companies within three weeks from the receipt of yield data based on crop-cutting experiments so as to instil faith among farmers under the Pradhan Mantri Fasal Bima Yojana, he said.
Highlighting the sensitive fishermen issue, the Chief Minister said that the nonrelease of boats by the Sri Lankan Navy caused immense hardship, and urged the Centre to secure their immediate release. He reiterated the request for the early sanction of the Comprehensive Special Package for diversification of fisheries.
Underscoring the State’s stand against NEET, he contended that it would lead to grave injustice [for students from Tamil Nadu]; he urged the Centre to immediately approve the two Bills passed in the Assembly in this regard.
