Modi, CMs meet to discuss financial devolution; Mamata to skip

PM to discuss future of Plans, funds for states with chief ministers today

The day-long meeting between Prime Minister Narendra Modi and chief ministers of states, his first such interaction after assuming office in May, is expected to be stormy.

According to sources, chief ministers of non-BJP ruled states are expected to show their opposition to the manner in which the Planning Commission is being scrapped and also other decisions of the central government.

The meeting has been called to discuss the fate of the Planning Commission and deliberate on the shape of the new body that will replace it. Officials said chief ministers would be free to raise other issues during the two-hour long second session where aides would not be present.

MEETING OF MINDS

• The day-long meeting between Prime Minister Narendra Modi and chief ministers may discuss other issues apart from Planning Commission revamp
• Devolution of financial resources between Centre and states to figure prominently in the meeting
• The meeting will be held in two parts. Planning Commission secretary will make a presentation on the current state of the Commission and work being done by it in the first half
• In the second session, Modi is expected to meet the chief ministers alone without aides

West Bengal Chief Minister and Trinamool Congress leader Mamata Banerjee, with whom the current National Democratic Alliance government does not share a cordial relationship, has decided not to attend the meeting. The state is expected to be represented by its Finance and Industries Minister Amit Mitra.

Officials said the contentious issue of sharing central plan funds with states was expected to figure prominently in the discussions. There could also be a move towards altering the Gadgil-Mukherjee formula through which a part of plan funds are devolved to states.

States for long have complained their untied funds from the central government are being squeezed after New Delhi started allocating more money through centrally sponsored schemes. In 2013-14, the total central assistance to state governments for plan expenditure was around Rs 1,25,572 crore, of which additional central assistance for special and other programmes was around Rs 90,408 crore, that is around 72 per cent.  Much of the additional central assistance was tied to some central scheme or the other.

Another segment of central finances goes to states through the Finance Commissions, which operate under supervision of the finance ministry.

On the Planning Commission, officials said according to a rough draft, the new body was expected to be called  Neeti Aayog. It will comprise four departments, including direct benefit transfer, the Unique Identification Authority, inter-state councils and programme evaluation. Each will be headed by a secretary, with the prime minister as the chairman of the body. Some of these bodies like the Unique Identification Authority, an attached office, even now function within the overall supervision of Planning Commission.

The meeting with chief ministers is also likely to discuss cooperative federalism, the Centre-state relationship and, most importantly, the future of the five-year planning process. Officials said according to the agenda finalised for the meeting, chief ministers had been asked to convey views on five-year plans, annual plans and state plans.

The meeting will be held in two parts. In the first half, the secretary of the Planning Commission will make a presentation on the current state of the commission and work being done by it.  “In the second session, Prime Minister Modi is expected to meet the chief ministers alone without aides, “ the official said. This meeting, officials said, was expected to last for two hours.

In his maiden Independence Day speech, Modi had signaled the abolition of the commission.

Thereafter, a series of discussions were held between experts and economists on the shape of the new plan panel.