Patnaik flags concern over ToR of 15th Finance Commission

The Odisha government today strongly opposed the Terms of Reference (ToR) of the 15th Finance Commission, saying it may adversely impact devolution of resources to the state.

The state government is of the opinion that the flow of funds will decline during the 15th Finance Commission because the Centre will adopt 2011 census data as base.

Whereas, if the Centre takes the 1971 census as base, it will reflect the state's efforts in stabilising the population, it has argued.

"Our main suggestions during the consultation prior to the notification of the ToR appear to have been ignored...I would, therefore, request your personal intervention so that the issues are appropriately addressed," Chief Minister Naveen Patnaik said in a letter to Prime Minister Narendra Modi.

Patnaik said the Presidential order on constitution and ToR of the 15th Finance Commission has made significant departure from the ToR of the previous Finance Commission.

On vertical devolution, the ToR seeks to put fetters on the remit of the commission. Instead of giving the freedom to the commission to arrive at its recommendations on resource sharing between the Centre and states, he said.

"On horizontal devolution, the ToR makes a radical departure by mandating the Commission to use population data of 2011 while making its recommendations. Population criterion is a very important factor in determination of share of a state in the divisible pool," Patnaik said.

The ToR using the 2011 census data will have a huge adverse impact on Odisha's share as the state is already below the Population Replacement Rate of 2.1 indicating that we have stabilised our population, Patnaik said in the letter.

Stating that Odisha has been demanding Special Category Status for a long time, he said it made efforts to reduce poverty and improve human development indicators such as literacy, infant and maternal mortality, nutrition, health, drinking water and other social infrastructure.