Finance & Stock Market
Finance Secretary: "No Conscious Discrimination" Regarding the Center-States Funds Row
By - 06 Feb 2024 06:03 PM
According to TV Somanathan, the finance secretary, financial allocations to states—whether through tax devolution or money from federally sponsored welfare programs—are determined by consistent rules that prohibit discrimination. She made this statement in an exclusive interview with NDTV.
The remarks made by Mr. Somanathan coincide with a day after a heated argument between Congress MP Adhir Ranjan Chowdhury and Finance Minister Nirmala Sitharaman over claims that non-BJP states are "deprived of (financial) dues.""In the operation of the Finance Ministry as regards funding to states, we go by formulae that have been laid down by the Finance Commission... we have not discriminated, for or against, any state government," Mr. Somanathan explained today, emphasizing what the Finance Minister had stated.There doesn't seem to be any intentional discrimination, but I won't get into the political aspects."
He stated that the distribution of GST, or the sharing of tax revenue, is based on percentages established by the Finance Commission and examined by the Comptroller and Auditor General. Bengal and Punjab, among other states, have regularly claimed withholding dues. This issue has been contentious for years.
He emphasized that these were immutable and that funds were disbursed in accordance with the guidelines; yesterday, Ms. Sitharaman reiterated this and added that she was unable to modify them "as per my whims".
According to Mr. Somanathan, the distribution of funds for the center's sponsored schemes is also based on predetermined percentages: 60-40 for "mainstream" states and 90-10 for northeastern or hill states.
We disburse money in percentages, so long as the prior installment was used, the funds will be disbursed. Thus, I can state unequivocally that the Finance Ministry is nondiscriminatory. I am unable to comment on the complaints that some states may have regarding the Finance Commission's percentages.However, we have followed the Finance Commission's recommendations exactly," Mr. Somanathan stated.
In response to a query regarding the conflict between the center and the ruling Trinamool Congress of Bengal—wherein Chief Minister Mamata Banerjee staged a protest event last week to demand the state's "dues"—the Finance Secretary informed NDTV that the Prime Minister's Office had emphasized that Bengal receive its fair share.
