Latest news with #FinanceCommission
Time of India
16 hours ago
- Politics
- Time of India
Govt may advance local polls in Telangana amid early monsoon, kharif sowing
Hyderabad: With the monsoon arriving 15 days ahead of schedule and kharif sowing already underway, the Congress govt is considering advancing the panchayat elections , originally planned for the end of July. The elections, likely to be held in two phases, will be the first major political test for chief minister A Revanth Reddy after the assembly and Lok Sabha elections. Sensing an opportunity to consolidate its rural base, the Congress is moving swiftly. It aims to cover all eligible farmers with Rythu Bharosa financial aid, clear pending gram panchayat bills, and roll out Rajiv Vikasam self-employment assistance to rural youth. The govt has already extended 21,000 crore in interest-free loans to women's self-help groups—primarily in rural areas—a key constituency in these elections. Though panchayat polls are technically non-party contests, they are fought fiercely along party lines. With 12,800 gram panchayats and over 1.2 lakh ward seats up for grabs, the Congress is keen to send a strong message to both the BJP and BRS by aiming to win 70–80% of the seats. A senior Congress leader said the party will support 42% of gram panchayat candidates from the BC community, in line with CM Revanth's promise made during the passage of the two bills providing 42% reservation for BCs in education, employment, and local bodies. "We will tell voters that the (Narendra) Modi govt is stalling the BC bills and highlight the BRS's internal rifts. Local-level alliances may be left to candidates depending on ground realities," the leader added. Under the Panchayat Raj Act, the State Election Commission requires formal consent from the state govt to conduct elections. This approval depends on the state govt's ability to provide adequate police deployment and logistical support to ensure free and fair elections. The Congress is also banking on organisational readiness. Party sources say the AICC is expected to finalise all new TPCC teams, including working presidents, vice-presidents, general secretaries, and campaign committee members, before the panchayat poll schedule is announced. Appointments at the district, block, mandal, and village levels are also in the pipeline. Meanwhile, nearly 2,000 crore in central grants under the Finance Commission has been withheld due to the absence of elected local bodies. Conducting these polls could unlock those funds, adding further urgency to the Congress's electoral push.
Hans India
2 days ago
- Business
- Hans India
Jharkhand seeks Rs 3.03 lakh crore from 16th Finance Commission for development
Ranchi: The Jharkhand government has sought a grant of Rs 3.03 lakh crore from the 16th Finance Commission to accelerate the state's integrated and inclusive development. On Friday, ministers, senior officials, and representatives of the state administration made a detailed presentation before the visiting Finance Commission team, outlining a comprehensive roadmap for growth across key sectors. The Commission, led by Chairman Arvind Panagariya, is currently on a four-day tour of the state. The state government argued that despite Jharkhand's abundant mineral and natural resources, it has not received central grants in proportion to the extent its resources are used for national development. In the high-level meeting, Finance Minister Radha Krishna Kishore, along with Higher Education, Urban Development and Tourism Minister Sudivya Kumar Sonu, Water Resources Minister Yogendra Prasad, and other officials, emphasised the need for special financial support to bring Jharkhand on par with more developed states. The government has put forward a demand of Rs 2.01 lakh crore specifically for infrastructure development, covering critical areas such as roads, bridges, rural development, transport, urban infrastructure, energy, industry, and tourism. The state's additional demands include Rs 44,447 crore for the social sector; Rs 41,388 crore for agriculture, forests, and water resources; and Rs 17,918 crore for home affairs, Panchayati Raj, land reforms, and revenue administration. Following the meeting, Minister Sudivya Kumar Sonu said the Commission took detailed feedback on the state's conditions, challenges, and priorities. 'Their approach towards our demands appeared positive,' he said. Water Resources Minister Yogendra Prasad added: 'We have presented a comprehensive report on Jharkhand's unique challenges and aspirations. We remain hopeful that the Commission will do justice to our needs.' He said, 'We are confident that Jharkhand will receive grants aligned with our vision for holistic development across all sectors.'
Indian Express
3 days ago
- Business
- Indian Express
3rd-party evaluation must for Central schemes to go on beyond March 2026
As the government prepares to prioritise its schemes for the 16th Finance Cycle starting on April 1st next year, the Ministry of Finance has told all ministries and departments that no Centrally Sponsored Scheme (CSS) or Central Sector Scheme (CS) will be considered for continuation beyond March 31st, 2026, unless a third-party evaluation of the scheme is carried out. This was conveyed to all Secretaries of the Government of India and Financial Advisors (FAs) during a meeting chaired by Cabinet Secretary TV Somanathan on Thursday. The meeting, which was attended by Secretaries of Government of India and Financial Advisors, discussed the appraisal and approval process of CSS and CS for the 16th Finance Commission cycle (2026-31). Before the meeting, the Department of Expenditure had circulated to the ministries 'a note on the points to be discussed in the meeting and context'. 'No Scheme (CSS and CSs) which is to continue over the next FC cycle will be taken up for appraisal unless a Third Party evaluation of the scheme is conducted. The Evaluation Report must demonstrate positive 'outcomes' as well as the need for continuing the scheme in view of its mandate and performance,' reads the note. According to sources, NITI Aayog, the government's top think tank, is currently conducting evaluation of the CSSs. This exercise is to be completed shortly and the draft reports will be shared with the respective ministries and departments, the sources said. NITI Aayog officials present in the meeting, made a PowerPoint presentation on the ongoing evaluation studies. The sources say that ministries and departments have been asked to conduct evaluation studies of their schemes by the end of July this year and get approval for continuation of schemes beyond March 31, 2026 from the Expenditure Finance Committee (EFC) before the start of the budget making process. The Ministries and Departments have been informed that in the 16th Finance Commission cycle (2026-31), they will receive allocation 5.5 times their average actual annual expenditure during the last five fiscal years (2021-22-2025-26). During the meeting, several ministries are learnt to have sought higher allocation for their programs. For instance, the Ministry of Health and Family Welfare sought additional funding for vaccinations, it is learnt. When officials from several ministries made demands for higher allocation in the next Finance Commission cycle, the Cabinet Secretary is learnt to have made a remark that they should propose realistic outlays and not 'inflated' figures while seeking outlay for the next five years. In November 2023, the government approved the constitution of the 16th Finance Commission. It is expected to make its report available by October 31, 2025. The recommendations of the 16th Finance Commission will be for a period of five years commencing on the 1st day of April, 2026. Harikishan Sharma, Senior Assistant Editor at The Indian Express' National Bureau, specializes in reporting on governance, policy, and data. He covers the Prime Minister's Office and pivotal central ministries, such as the Ministry of Agriculture & Farmers' Welfare, Ministry of Cooperation, Ministry of Consumer Affairs, Food and Public Distribution, Ministry of Rural Development, and Ministry of Jal Shakti. His work primarily revolves around reporting and policy analysis. In addition to this, he authors a weekly column titled "STATE-ISTICALLY SPEAKING," which is prominently featured on The Indian Express website. In this column, he immerses readers in narratives deeply rooted in socio-economic, political, and electoral data, providing insightful perspectives on these critical aspects of governance and society. ... Read More
The Hindu
3 days ago
- Business
- The Hindu
The case for a special fiscal package for Andhra Pradesh
Andhra Pradesh is in deep financial distress and there is a strong case for the Finance Commission to make a special dispensation for the State. When Telangana was carved out of the larger State of Andhra Pradesh in 2014, the rump State of Andhra Pradesh demanded that it be given a 'special category' status to cope with the loss of Hyderabad, the dominant tax generator of the combined State. Even though then Prime Minister Manmohan Singh gave an assurance on the floor of Parliament conceding this demand, the Act dividing the State did not make any provision for a special category status. The division of the State took effect in June 2014, a time when the National Democratic Alliance government had replaced the United Progressive Alliance government at the Centre; N. Chandrababu Naidu became the first Chief Minister of the rump State of Andhra Pradesh. All through his term (2014-19), Mr. Naidu fought energetically for the parliamentary assurance to be honoured but the Narendra Modi government stonewalled the plea on the ground that the Centre had discontinued the 'special category' scheme on the advice of the 14th Finance Commission. Mr. Naidu, who returned as the Chief Minister in 2024 is staring at near empty coffers after the blows of structural fiscal handicaps and the pressure of funding unaffordable freebies under the preceding Y.S. Jagan Mohan Reddy government (which he topped up handsomely in his own campaign). Competitive freebies under electoral pressures are a State-level issue and the Centre is under no obligation to come to the State's aid. But the Centre has a definite obligation to compensate Andhra Pradesh for the structural fiscal losses it suffered on account of the bifurcation of the State. An option A straightforward option is for the Centre to make an exception and accord 'special category' status to Andhra Pradesh on the ground that it is only fulfilling an assurance given in Parliament. But for Andhra Pradesh itself, this may not be an attractive choice because the 'special category status' has been watered down. Unlike before, when a special category State received substantial fiscal support through Plan assistance, all that it now gets is external loans such as those from the World Bank on slightly softer terms. Such a diluted 'special category status' will be a hollow victory for Andhra Pradesh. A better option for Andhra Pradesh is to seek a special package of assistance that is more generous than a straitjacketed special category status. There are many precedents for politically driven, discretionary special packages such as the Koraput-Balangir-Kalahandi special plan for Odisha and the Bundelkhand special package for Madhya Pradesh and Uttar Pradesh. Bihar was also given a special 'pre-election' package in 2015. However, such 'one off' packages on political and discretionary grounds weaken the federal fabric and are best avoided. A neater option is for the Finance Commission to recommend a special package for Andhra Pradesh. Since the Finance Commission is an apolitical, professional body enjoying a constitutional status, its recommendation will have gravitas. States and divisions But what is the case for Andhra Pradesh that the Finance Commission should consider? All divisions of States into smaller units post 1956 have been done on political, administrative or geographical considerations. This has inevitably resulted in an uneven division of fiscal capacity. There are many indicators of the fiscal capacity of a State. One of the most robust is the State's own revenue. Consider State divisions that happened post 2000: Uttar Pradesh, Madhya Pradesh and Bihar were broken up in the year 2000, and Andhra Pradesh was divided in 2014. The table shows that in terms of per capita own revenue, in each of these cases, the carved out States, namely Uttarakhand, Chhattisgarh, Jharkhand and Telangana, gained at the expense of the rump States. But the loss in the case of Uttar Pradesh and Madhya Pradesh was relatively small when compared to that of Bihar and Andhra Pradesh. One possible formula for a special package is that if the loss in fiscal capacity of a State on account of division is more than 10%, the Centre would give a special package spread over a limited period to compensate for the loss. On this formula, both Bihar and Andhra Pradesh will qualify for assistance. The Finance Commission could of course consider other formulae that it thinks better capture the gain or loss in fiscal capacity. The important thing is that States such as Andhra Pradesh that have lost fiscal capacity on account of bifurcation are not abandoned to fend for themselves. It is incumbent on the Finance Commission, which is free to make recommendations to put our fiscal federalism on a sound footing, to evolve an objective, apolitical and formula-based solution to the problem. Duvvuri Subbarao is former Finance Secretary to the Government of India and a former Governor, Reserve Bank of India
Mint
3 days ago
- Business
- Mint
Centre starts review of schemes ahead of fresh roll-out in April 2026
New Delhi: The Union government on Thursday kicked off a massive exercise to review the schemes it is funding for a fresh roll-out from April next year, said an official statement. The review covers central sector schemes (CSs), which are fully financed by the central government, as well as centrally sponsored ones (CSSs), which are financed by both central and state governments at a pre-defined ratio. Cabinet secretary T.V. Somanathan chaired the review meeting organized by the expenditure department in the finance ministry which was attended by top officials across the government. The review enables the government to avoid overlap of schemes and better target financial resources to eligible beneficiaries. Prime Minister Narendra Modi has emphasized that the poor, farmers, the youth and women are central to government welfare initiatives. The policy of evaluation of ongoing schemes and having a sunset date for each scheme was articulated by the government in the Union Budget of 2016. It stated that in order to improve the quality of public expenditure, every scheme will have a sunset date and an outcome review. Later, the schemes have been aligned with the Finance Commission cycles and their continuation is based on the evaluation of each scheme by a third party. During the meeting, the Cabinet Secretary emphasized the rigour of the evaluation process and urged the secretaries of various departments to use its recommendations to recalibrate the design, architecture of the scheme, remove redundancies and ineffective suboptimal interventions, merge schemes and close schemes which have either outlived their utility or have fulfilled their objectives. This will enable optimum deployment of scarce public resources, the statement said. The Finance Commissions decide on the sharing of the central government's divisible pool of tax revenue with states. At present, the Sixteenth Finance Commission led by economist Arvind Panagariya is working on recommendations for tax revenue sharing between central and state governments for the five-year period starting April 2026. The Department of Expenditure provided an overview of the availability of financial resources at the meeting. Secretaries were informed about the norms likely to be used for deciding the resources available to each of the department for their schemes over the next five-year cycle. There are 54 centrally sponsored schemes and 260 central sector schemes which have their terminal date of approval till 31 March and are likely to be submitted to re-appraisal. A majority of these will also require fresh approval of the Cabinet, the statement said. The Department of Expenditure stressed the quality and effectiveness of public expenditure and, in this context, said that such exercises in the past had allowed the central government to enhance its capital expenditure substantially which now stands at ₹ 11.21 trillion for FY26 as per budget estimates. The meeting also discussed universal Aadhaar-based Direct Benefit Transfer (DBT), convergence of various schemes for having a greater impact, eliminating duplication and attaching conditionalities to drive reforms. The implementation of 'just in time release of funds' and avoiding parking of funds with implementing agencies long before funds are needed for utilization was also emphasized at the meeting. This will enable deployment of the savings thus accrued for new schemes or expansion of ongoing schemes, the statement said.
