Lok Sabha Question No. 485 (UNSTARRED), answered on 2016-11-18
Subject: Finance Commission
Ministry: FINANCE
Asked by: M. UDHAYAKUMAR, KAMLA DEVI PATLE

- (a) the guidelines/criteria adopted by the Central Government and State Government for allocation of different funds/grants under various heads;

(b)  the  details  of  funds  allocated  to  State  Governments/UTs  on  the  recommendations  of  twelfth,  thirteenth  and  fourteenth  finance commissions head-wise, State/UT-wise;

(c)  whether  some  State/UTs  including  Chhattisgarh  have  requested/proposed  to  relax  the  limit  of  credit  taken  by  State  under  Fiscal Responsibility and Budget Management (FRBM) Act;

(d) if so, the details thereof and the action taken thereon; and

(e) whether the Government is aware of non-release of grant of Rs. 11,366.90 to Tamil Nadu as recommended by 13th Finance Commission despite submission of utilisation certificate for the expenditure incurred, if so, the details thereof and the steps taken in this regard?

## ANSWER

## MINISTER OF STATE FOR FINANCE

## (SHRI  ARJUN RAM MEGHWAL)

(a)&(b): Finance Commission  makes recommendations for horizontal and vertical distribution of States' Share of Central Taxes & Duties, various grants-in-aid  i.e. local bodies grants, disaster relief grants, etc. to be provided to States during its award period. Transfer of central assistance to the State Governments are also done through Centrally Sponsored Schemes (CSS) and Central Sector Schemes (CS), annually determined  as  per  the  guidelines  of  the  respective  Scheme/  Programme  within  the  availability  of  Gross  Budgetary  Support.        The Government allocates the funds as per the accepted recommendations of the Finance Commission and provides the same to the States under the currency of the award period of the Commission. The statements indicating State-wise and sector-wise allocations of Non Plan grantsin-aid recommended by the Twelfth Finance Commission, the Thirteenth Finance Commission and the Fourteenth Finance Commission are given at Annexure-I , II and III respectively. These Finance Commissions have not recommended grants-in-aid for Union Territories.

(c)&(d):  The States of Goa, Kerala, Punjab and Rajasthan have requested for additional borrowings by relaxing the limit of credit taken by State under Fiscal Responsibility and Budget Management (FRBM) Act in the award period of 14 th Finance Commission (FFC). No such request has been received from State Govt. of Chhattisgarh. The Central Government determines and regulates the Annual Net Borrowing

Ceiling for each State within their respective Fiscal Deficit targets as per formula prescribed by the Finance Commissions. As such requests received from States for increase in borrowing limits are considered within the ambit of recommendations of Finance Commissions. The 14th Finance Commission (FFC) has prescribed the Fiscal Roadmap for each State for its award period 2015-20 and anchored Fiscal Deficit target of all States to an annual limit of 3% of GSDP. FFC has also recommended the additional borrowings space of 0.5% over and above the  FD/GSDP limit of 3% subject to fulfilment of prescribed  fiscal targets, which  have been  allowed to the  eligible States in 2016-17. Besides,  the  Central  Government  has  approved  relaxation  of  Fiscal  Deficit  Limit  under  States'  Fiscal  Responsibility  and  Budget Management Acts (FRMBA) for borrowings under Ujwal DISCOM Assurance Yojna (UDAY) during 2015-16 and 2016-17.

(e): The Thirteenth Finance Commission (FC-XIII) had recommended a non-plan grant of Rs.11,366.90 crore to Tamil Nadu for its  award period  i.e.  2010-11  to  2014-15.  Against  the  total  allocation  of  Rs.  11,366.90  crore,  Grants-in  aid  of  Rs.  8613.45  crore  was  released  by Central Government to Tamil Nadu as per recommendations of the FC-XIII. Besides, an amount of Rs. 1504.54 crore was also released to Tamil Nadu for reduction in Infant Mortality Rate (IMR) and incentive for Renewable Energy components as per recommendation of FCXIII. Thus, a total grant of Rs. 10,117.99 crore was released to Tamil Nadu by the end of FC-XIII award period. Reasons for short releases are non-fulfilment of requirements such as non-receipt of State High Level Committee approved action plans, non-receipt of utilization / completion  certificates,  and  non-payment  of  interest  by  the  States  to  Local  Bodies  at  Bank  rate  for  delayed  transfer  of  grants  beyond stipulated  period.  The  grants-in-aid  released  by  the  Central  Government  as  per  recommendation  of  FC-XIII  is  based  on  the  utilization certificate  furnished  and  associated  conditionalities  fulfilled  by  the  state  government  before  the  expiry  of  the  FC-XIII  award  period  on 31.03.2015. Since the period of implementation of recommendations of the Thirteenth Finance Commission (FC-XIII) was over on 31 st March, 2015, no balance grant, if any, is payable to Tamil Nadu. The requests for release of balance grant of FC-XIII received from time to time from the State Government of Tamil Nadu were processed within the ambit of recommendations of FC-XIII and the State Government was suitably informed.

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|             |                              |                                  |                      |                                               |                               |                                 |                            |                                     |                                                              |                                         |                    |                                 |                                   |                           | ANNEXURE-II                                   |
|-------------|------------------------------|----------------------------------|----------------------|-----------------------------------------------|-------------------------------|---------------------------------|----------------------------|-------------------------------------|--------------------------------------------------------------|-----------------------------------------|--------------------|---------------------------------|-----------------------------------|---------------------------|-----------------------------------------------|
| State       |                              |                                  | ANNEXURE             | REFERRED TO IN                                | REPLY TO PART                 | (b) OF LOK SABHA GRANTS-IN-AID  | UNSTARRED RECOMMENDED      | QUESTION NO.485 BY THIRTEENTH       | TO BE FINANCE                                                | ANSWERED ON 18th COMMISSION             | NOVEMBER,          | 2016                            |                                   |                           |                                               |
|             | Post Devolu tion NPRD (2010- | Performanc e Incentive (2010-13) | Local Body (2010-15) | Disaster Relief (including capacity building) | Element ary Educatio n (2010- |                                 |                            | Improving Outcomes                  |                                                              |                                         | Environment Grants | related                         | Mainten ance of Roads and Bridges | State Specific (2010- 15) | Total Grants-in- aid [sum of col.2 to col.15] |
|             | 15)                          |                                  |                      | (2010-15)                                     | 15)                           | Improvement in Justice Delivery | Incentive for Issuing UIDs | District Innovation Fund (2010- 15) | Improvem ent of Statistical Systems at State &District Level | Employee and Pension Database (2010-15) | Forests (2010-15)  | Water Sector Manage ment (2011- | (2011- 15)                        |                           | (2010-15)                                     |
|             |                              |                                  |                      |                                               |                               | (2010-15)                       | (2010-15)                  |                                     | (2010-15)                                                    |                                         |                    | 15)                             |                                   |                           |                                               |
|             | 1                            |                                  |                      |                                               |                               |                                 |                            |                                     |                                                              |                                         |                    | 13                              |                                   |                           |                                               |
| 1           | Andhra Pradesh               | 2 3                              | 4                    | 5                                             | 6                             | 7                               | 8                          | 9                                   | 10                                                           | 11                                      | 12                 |                                 | 14                                | 15                        | 16                                            |
|             | Arunacha                     | 0 0                              | 7195.1               | 2138.7                                        | 942                           | 270.7                           | 126.1                      | 23                                  | 23                                                           | 10                                      | 268.6              | 284                             | 981                               | 1270                      | 13532.3                                       |
| 2           | l Pradesh 2516.2             | 0                                | 305.7                | 187.7                                         | 24                            | 77.6                            | 2                          | 16                                  | 16                                                           | 5                                       | 727.8              | 8                               | 162                               | 300                       | 4348.2                                        |
| 3           | Assam                        | 0 300                            | 1892.8               | 1336.8                                        | 238                           | 121.1                           | 55.8                       | 27                                  | 27                                                           | 5                                       | 184.6 38.4         | 88 304                          | 336                               | 600                       | 5212.1 14602.8                                |
| 4 Chhattisg | Bihar                        | 0 0                              | 5682.1               | 1411.2                                        | 4018                          | 385                             | 369.2                      | 38                                  | 38                                                           | 10                                      |                    |                                 | 464                               | 1845                      |                                               |
| 5           | arh                          | 0 0                              | 2267.2               | 647.1                                         | 857                           | 125.1                           | 91                         | 18                                  | 18                                                           | 10                                      | 411.1              | 88                              | 362                               | 1281                      | 6175.5                                        |
| 6           | Goa                          | 0 0                              | 172                  | 17.3                                          | 11                            | 15                              | 2                          | 2                                   | 2                                                            | 10                                      | 36.9               | 8                               | 40                                | 200                       | 516.2                                         |
| 7           | Gujarat                      | 0 0                              | 3757.6               | 2110.9                                        | 483                           | 299.8                           | 90.7                       | 26                                  | 26                                                           | 10                                      | 81.9               | 236                             | 1261                              | 1300                      | 9682.9                                        |
| 8           | Haryana Himachal             | 0 0                              | 1521.3               | 824.4                                         | 229                           | 124.2                           | 32.1                       | 21                                  | 21                                                           | 10                                      | 8.8                | 212                             | 267                               | 1000                      | 4270.8                                        |
| 9           | Pradesh 7888.8 Jammu&        | 0                                | 641.5                | 670.3                                         | 113                           | 64.8                            | 6.4                        | 12                                  | 12                                                           | 5                                       | 100.6              | 64                              | 436                               | 350                       | 10364.4                                       |
| 10          | Kashmir                      | 15936. 3 0                       | 1122.6               | 877.6                                         | 449                           | 104.5                           | 5.9                        | 22                                  | 22                                                           | 5                                       | 133                | 88                              | 140                               | 1350                      | 20255.9                                       |
| 11          | Jharkhan d                   | 0 0                              | 2239.8               | 1100.2                                        | 1528                          | 177.5                           | 116.4                      | 24                                  | 24                                                           | 10                                      | 151.4              | 108                             | 334                               | 1425                      | 7238.4                                        |
| 12          | Karnatak a                   | 0 0                              | 6496.7               | 687.1                                         | 667                           | 269.8                           | 138.9                      | 29                                  | 29                                                           | 10                                      | 221                | 128                             | 1625                              | 1300                      | 11601.4                                       |
| 13          | Kerala                       | 0 0                              | 2676.1               | 563.2                                         | 140                           | 140.1                           | 49.6                       | 14                                  | 14                                                           | 10                                      | 135.5              | 176                             | 953                               | 1500                      | 6371.5                                        |

| 14   | Madhya Pradesh   |       0 |    0 |   5833.5 |   1652.7 |   2216 |   407.4 |   249.7 |   50 |   50 |   10 |   490.3 |   148 |   986 |   1231 |   13324.5 |
|------|------------------|---------|------|----------|----------|--------|---------|---------|------|------|------|---------|-------|-------|--------|-----------|
| 15   | Maharas htra     |     0   |    0 |   8743.6 |   1859.6 |    744 |   542.7 |   317.4 |   35 |   35 |   10 |   309.6 |   368 |  2103 |   1235 |   16302.8 |
| 16   | Manipur          |  6056.6 |    0 |    315.9 |     40.9 |     15 |    11.6 |     4   |    9 |    9 |    5 |   150.3 |     8 |   100 |    301 |    7026.3 |
| 17   | Meghala ya       |  2810.9 |    0 |    432.4 |     77.9 |     52 |     4.2 |     4.5 |    7 |    7 |    5 |   168.1 |     4 |   101 |    250 |    3923.9 |
| 18   | Mizoram          |  3991.4 |    0 |    310.7 |     47.5 |      5 |    13   |     1.2 |    8 |    8 |    5 |   171.2 |     4 |    89 |    250 |    4904   |
| 19   | Nagaland         |  8146.1 |    0 |    415.7 |     29.7 |      7 |     6.2 |     4   |   11 |   11 |    5 |   138.6 |     8 |   159 |    250 |    9191.3 |
| 20   | Orissa           |     0   |    0 |   3270.9 |   1647.8 |   1016 |   193.6 |   178.5 |   30 |   30 |   10 |   331   |   184 |  1022 |   1745 |    9658.8 |
| 21   | Punjab           |     0   |    0 |   1753.8 |    948.8 |    224 |   120.8 |    21.6 |   20 |   20 |   10 |     9.2 |   320 |   612 |   1480 |    5540.3 |
| 22   | Rajastha n       |     0   |    0 |   5163.8 |   2519.3 |   1766 |   268.5 |   134.9 |   33 |   33 |   10 |    88.3 |   224 |  1509 |   1200 |   12949.8 |
| 23   | Sikkim           |     0   |  200 |    187.2 |    118.1 |      5 |    21.8 |     1.1 |    4 |    4 |    5 |    40.6 |     4 |    68 |    400 |    1058.8 |
| 24   | Tamil Nadu       |     0   |    0 |   5455.9 |   1241.4 |    700 |   252.4 |   145.6 |   31 |   31 |   10 |   142.5 |   192 |  1865 |   1300 |   11366.9 |
| 25   | Tripura          |  4453.3 |    0 |    369.8 |    101   |     23 |    24   |     6.4 |    4 |    4 |    5 |    95.5 |     8 |   122 |    500 |    5716.1 |
| 26   | Uttar Pradesh    |     0   |    0 |  12740.5 |   1622.1 |   5040 |   645.8 |   590   |   70 |   70 |   10 |    80.5 |  1364 |  2831 |   1679 |   26742.9 |
| 27   | Uttarakh and     |     0   | 1000 |    781.3 |    605.1 |    197 |   102.2 |    36   |   13 |   13 |    5 |   205.4 |    76 |   329 |    700 |    4063   |
| 28   | West Bengal      |     0   |    0 |   5773.1 |   1288.3 |   2359 |   210.9 |   208.4 |   19 |   19 |   10 |    79   |   296 |   673 |   1703 |   12638.7 |
|      | Total            | 51800   | 1500 |  87519   |  26373   |  24068 |  5000   |  2989   |  616 |  616 |  225 |  5000   |  5000 | 19930 |  27945 |  258581   |

The Total Grants-in-aid figure in column 16 does not include a) GST Compensation grants (Rs. 50,000 crores), b) Grants for reduction in IMR (Rs. 5000  crores) and c) Renewable energy grant (Rs. 5000 crores) as these are based on future ance and hence their state-wise allocation is not possible at this stage. Adding these forward looking grants to the total grants figure in column 16,  the Total Grants-in-aid figure works out to Rs. 318581 crores.