The 14th Finance Commission, chaired by former Reserve Bank Governor Y.V. Reddy, has not submitted a unanimous report. Abhijit Sen, commission member, gave a dissent note to the report.
The Modi government has not yet announced its decision on the report submitted to President Pranab Mukherjee’s office in mid-December. Union Finance Minister Arun Jaitley did not table it in Parliament during the Winter Session. Mr. Jaitley is expected to present it during the Budget Session due to begin on February 23.
“I cannot say anything on the commission until its report is tabled in Parliament,” Dr. Sen said.
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The Third Finance Commission too had a dissent note, and the then Union government accepted it, rejecting one of the recommendations of the panel.
The present commission has recommended a 42 per cent share of Central tax revenues for States for the period from April 1, 2015, to March 31, 2020. The dissent note has recommended that the States share could be 38 per cent.
The 13th Finance Commission recommendation for 2010-15 was 32 per cent, which the UPA government implemented.
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A source close to the commission explained that it had not recommended a sharp rise in the Centre’s transfers to the States compared with the recommendations of the previous panels.
The recommendations of the previous panels were only for statutory transfers, but the present commission’s recommendation of 42 per cent is for total transfers of funds from the Centre to the States under all heads, said the source.
Besides statutory transfers, it includes non-Plan funds and Plan allocations that the erstwhile Planning Commission made.