Cabinet extends term of 15th Finance Commission till Oct 2020

The Union Cabinet on Wednesday extended the tenure of 15th Finance Commission till October 30 next year.

"The extension of the term will enable the commission to examine various comparable estimates for financial projections in view of reforms and the new realities to finalise its recommendations for the period 2020-2026," said an official statement.

The commission will now submit an interim report for fiscal year 2020-21 and a full report for fiscal years 2021-22 to 2025-26 by October 30, 2020. Reports said it was given more time considering the creation of new union territories of Jammu and Kashmir and Ladakh.

Besides, due to restrictions imposed by the Model Code of Conduct in certain states, the commission completed its visit recently. This had a bearing on detailed assessments of states requirements.

The terms of reference for the commission are wide-ranging in nature. "Comprehensively examining their implications and aligning them to requirements of states and the Centre will require additional time," said the statement.

Making a five-year coverage available for the commission beyond April 1, 2021 will help both state and central governments design schemes with medium- to long-term financial perspective and provide adequate time for mid-course evaluation and correction.

It is anticipated that the impact of economic reforms initiated in the current financial year will be manifested in the data by the end of first quarter 2020-21, added the statement.

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