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:: Press Releases ::
Friday, January 31, 2014

1. Dr. Y.V. Reddy, Chairman, Ms. Sushama Nath, Prof. Abhijit Sen, Dr. M. Govinda Rao and Dr. Sudipto Mundle, Members of the Fourteenth Finance Commission and Sh. A.N. Jha, Secretary visited the State of Maharashtra from January 30-31, 2014 to hold consultations with the State Government and key stake holders.

2. The Commission met with the Hon’ble Chief Minister, his Cabinet Colleagues and senior officers of the State Government, for discussions.

3. The Chief Minister welcomed the Chairman and Members to Maharashtra and highlighted achievements made by the State in the field of Human Development including Health and Education. He also highlighted the priority areas of the State such as Irrigation projects for rainfed agriculture, accelerated urbanisation, transfer of funds to local bodies, quality of higher education, issue of high electricity tariffs for industries and the need to reduce the intra district disparities. He raised concerns about Union Government policies that impact the finances of states and the need for the Union Government to fully bear such costs. He also highlighted the special needs of Mumbai City.

4. The State Government submitted its Memorandum and made a detailed presentation on the finances of the State Government, its projection for the award period and gave its views on the Terms of Reference of the Commission. The State suggested that vertical devolution should be enhanced to 40% of the divisible pool of the central taxes. On horizontal distribution it was suggested that population be assigned a weight of 35%, fiscal capacity distance 25%, fiscal discipline 25% and area 15%. The state stressed that the size of State Disaster Response Fund be kept at Rs.10000 Crore for the award period. Besides this, the State also recommended allocation of 5% of the divisible pool for local bodies. The general basic grant and performance grant may be divided into rural and urban shares on basis of their respective population as per 2011 Census. Proposals relating to State Specific Grants amounting to Rs. 21,097 Crore were also placed before the Commission.

5. The Commission also interacted with representatives of political parties, Panchayati Raj Institutions, Urban local bodies and Trade and Industry Associations.

6. The Commission places on record its appreciation to the Chief Minister and State Government for the cooperation and support extended to the Commission and assures that the issues raised have been taken on board and will receive due attention in the deliberations of the Commission. The Commission also looks forward to its continuing interaction with the State Government.

7. The Commission will finalize its recommendations by October 2014 after completing its discussions with all the State Governments, the Government of India and relevant stake holders.

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