Sisodia tables the Fourth Finance Commission report in Assembly

The much-needed Delhi Fourth Finance Commission report was finally tabled before the Assembly for discussion on Wednesday. The report presented before the Delhi Assembly revealed that the Fourth Finance Commission was constituted in 2009 and was supposed to submit its report in January 2010 but it got delayed for almost three years. The commission had recommended for implementing this Finance Commission from 2010 to 2015.

The Bill was presented by Delhi deputy Chief Minister Manish Sisodia. BJP MLA Vijender Gupta, who has been relentlessly fighting both in and outside the Assembly for the bill, thanked the AAP government for tabling the bill.

The terms of reference for the commission mainly include distribution between the Delhi government and the Municipalities of the net proceeds of taxes, tolls and fees levied by the Delhi government, determination of taxes, duties, tolls and fees which may be assigned to the Municipalities, grants-in-aid to the Municipalities from the Consolidated Fund of the Delhi government to improve the financial position of the Municipalities, study the scope for economy in Municipal administration and the scope for improvement in resource mobilisation by the Municipalities, analyse tax efforts made by the Municipalities and review the functions assigned to them. 

The commission recommended that 12.5 per cent of the taxes, duties, fees and tolls collected by the Delhi government during the financial years 2012-13 onwards shall be kept in the divisible pool of Delhi for each financial year. 

The existing formula of sharing of funds among the Municipalities from the divisible pool based on population and area was in the ratio of 70 per cent: 30 per cent which is to be changed as it has adversely affected the financial health of at least two of the three Municipalities including NDMC for a long time. But in the new scheme, 50 per cent of the funds in the divisible pool shall be distributed among all the Municipalities with reference to the existing principle based on population and area in the ratio of 70:30.

It is expected that if this Fourth Finance Commission is cleared by the Delhi Assembly, all the three Municipal Corporations reeling under financial crunch will be benefitted.

In the last Delhi Assembly session all three BJP-ruled MCDs — North, South and East — had protested outside the Delhi Assembly to put pressure on the government to table and implement the recommendations of the Fourth Finance Commission.

In its report, the commission has recommended Municipal bodies to carry out the core municipal functioning which will help improving the financial health. The report also suggested that the Municipal Corporations should stop spending money beyond their scope. 

“Unlike the Panchayati Raj institution, providing education at the school level is not a Municipal function. Surprisingly, these Municipalities in Delhi, despite legal restrictions, continue to spend funds in providing primary education,” report said.

The Delhi government has decided to accept the recommendations of the Fourth Delhi Finance Commission report in totality only after the Centre implements the aforesaid recommendation of the commission. 
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