Kerala CM Pinarayi Vijayan.
Credit: PTI Photo
Kerala has urged that the 2011 Census population should be considered by the sixteenth Finance Commission (FC).
In the suggestions sent to the Centre in terms of reference for the FC, Kerala government suggested that instead of considering 2011 census either the 1971 Census figures should be considered or weightage should be given to states that have achieved low population growth.
It needs to be ensured that states that have effectively controlled population do not suffer a fall in tax share, Kerala said.
All Southern states had raised this concern during preparation of terms of reference for the 15th finance commission as well. While the low population growth of the Southern states could affect the Central allocations, states with higher population growth will benefit.
Kerala government sources point out that even with regards to delimitation of Lok Sabha constituencies the 2011 census was not considered.
If the finance commission considers the 2011 population, states like Kerala that kept the population growth to around 50 per cent will suffer.
Kerala also suggested that instead of the Centre prescribing conditions to the Finance Commission, the commission should be allowed to freely discharge the Constitutional mandate after duly considering the views expressed by the states and the Centre.
Other key suggestions made by Kerala for the terms of reference are that no conditionalities should be attached to grants, incentivising states to adopt environmental friendly measures by giving additional borrowing ceiling, among other things.
Kerala also wants to ensure that nothing that implicitly or explicitly assumes that spending by the Centre is superior and more appropriate for development should not be included in the terms of reference. FC should not be mandated to suggest what states should do when it comes to redistributive fiscal interventions.
The terms of reference should also consider that the continuity of the GST council and FC are necessary for fiscal federalism and autonomy, the state has demanded.
Expansive and restrictive items that take the focus away from the substantial constitutional mandate of the FC should not be included in the terms of reference, the state said.