The
President has constituted the Thirteenth Finance
Commission under Article 280 (1) of the Constitution.
Dr. Vijay L. Kelkar, former Union Finance Secretary and
Adviser to the Finance Minister has been appointed as
Chairman of the Commission. Shri B.K Chaturvedi, Member,
Planning Commission will be the part-time Member, and
Dr. Indira Rajaraman, Emeritus Professor, National
Institute of Public Finance and Policy, Dr. Abusaleh
Shariff, Chief Economist, National Council of Applied
Economic Research, Prof. Atul Sarma, Former
Vice-Chancellor, Rajiv Gandhi University (formerly
Arunachal University) shall be the full time Members of
the Commission. Shri Sumit Bose will be the Secretary to
the Commission.
The
Finance Commission is a Constitutional body set up every
five years to make recommendations relating to the
distribution of the net proceeds of taxes between the
Union and the States, the principles which should govern
the grants-in-aid of the revenues of the States out of the
Consolidated Fund of India and the measures needed to
augment the Consolidated Fund of a State to supplement the
resources of the Panchayats and the Municipalities. In
addition, any other matter may be referred to the
Commission by the President in the interests of sound
finance.
Apart from the terms of reference specifically laid down
in the Constitution, the Thirteenth Finance Commission
will review the state of finances of the Union and the
States keeping in view the operation of the States’ Debt
Consolidation & Relief Facility 2005-2010(DCRF) and
suggest measures for maintaining a stable and sustainable
fiscal environment consistent with equitable growth. The
Thirteenth Finance Commission will also review the present
arrangements as regards financing of Disaster Management
with reference to the National Calamity Contingency Fund
and the Calamity Relief Fund and the funds envisaged in
the Disaster Management Act, 2005.
As in the case of the previous Finance Commissions, the
13th Finance Commission will also take into consideration
various aspects while making its recommendations. These
relate to assessment of the resources of the Centre and
the State for the five year period, taxation efforts and
the potential of additional revenue mobilization, demands
on the resources of the Central Government, the
requirement of States to meet the non-salary component of
maintenance expenditure on capital assets and plan
schemes, the objective of not only balancing receipts and
expenditure but also generating surpluses, and the need to
ensure commercial viability of irrigation and power
projects, departmental undertakings and public sector
enterprises through various means including levy of user
charges and adoption of measures to promote efficiency.
The 13th Finance Commission will also take into
consideration the likely impact of the proposed
implementation of Goods and Services Act (GST) with effect
from 1st April, 2010, including its impact on foreign
trade. The Finance Commission has also been asked to
consider the need to improve the quality of public
expenditure to obtain better outputs and outcomes. The
need to manage ecology, environment and climate change
consistent with sustainable development, which is an issue
of national concern will also be taken into account by the
13th Finance Commission.
The recommendations of the Thirteenth Finance Commission
will cover the period of five years from Ist April, 2010
to 31st March 2015. The Commission is expected to make
available its report by 31st October, 2009.
