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Himachal Oppn unhappy with 15th Finance Commission award

Himachal Oppn unhappy with 15th Finance Commission award

Shimla: Just a few days before the state assembly session, opposition Congress has raised doubts on the 15th Finance Commission recommendation and claimed that it will add up to the state's financial crisis, instead of any relief.

"The debt-ridden state has not much to cheer about, if the interim report of the 15th Finance commission is any indication, the state will be left grappling with the financial crisis," said Mukesh Agnihotri, leader of Opposition

He said the report does not provide a complete picture as it was only limited to the devolution recommended for the first year ie 2020-21. As per reports, the state will receive Rs 19,309 crore, out of which Rs 11,431 crore has been recommended as revenue deficit grant, Rs 6,833 crore as tax devolution, Rs 636 for local bodies and Rs 409 crore to the State Disaster Relief Fund.

The increase in revenue deficit grant works out to 42.7 percent over the revenue deficit grant of Rs 8009 crore, recommended for the first year ie 2015-16, by the 14th finance commission, is far less compared to the deal which the state received under Virbhadra Singh government when the 14th finance commission which increased the revenue deficit grants to Rs 40,625 crore from 7,889 crore recommended by the 13th finance commission, a five-fold increase.

The total increase in revenue deficit grant based on first-year (Rs 11,431 crore) will amount to about Rs 57000 for the five years, said the leader of the opposition.

Agnihotri said "it may not suffice as the increase in states shares in central taxes will be modest due to unprecedented economic slowdown, with GDP growth hitting a low of 4.5 percent, and the shortfall in GST collections. On the other hand, the committed liabilities of the state comprising salaries and pensions of employees, interest and loan repayment will continue to increase at a higher rate".

There is no much hope for the state from the full report given the dismal state of the economy the state is likely to receive much less funds by way of devolution of central taxes from centre.

Earlier the state government had termed the recommendation as historic which will go a long way in solving the state's fiscal crisis for which the earlier Congress regime was responsible, said Bikram Thakur, industries minister. Thakur claimed that the previous Congress government did not make efforts for financial assistance for the state and therefore failed in getting higher grants. An annual average grant of Rs 4,338.4 crore was given to the state under the 13th Finance Commission when the UPA-II government led by the Congress was in power at the Centre,said minister drawing a comparison.

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