EFC's Award

Your editorial, ‘Don’t Shoot the Commission’ (September 23) is difficult to understand in the light of the eminently reasonable and quite valid critical observations in your own editorial columns on the award of the Eleventh Finance Commission (EFC). Practically all the awards of earlier finance commissions have been subjected to critical evaluations in professional journals like EPW and by knowledgeable experts. Even some state governments have expressed their displeasure. It is true that for the first time eight state governments have joined together in objecting to the award of EFC, but why should this be considered intrinsically objectionable? It is indeed unfortunate that a respected journal like yours has taken the view that objecting to the EFC award is almost tantamount to shooting the institution of the finance commission itself.

In commenting upon the representation of G-8, you yourself did not look upon the representation as questioning the role of a finance commission in the basic scheme of federal finance. The fact of the matter is that the procedures for determining the composition and for fixing the terms of reference of the commission, are fundamentally flawed. Why should it be left to the sweet will of the central ministries of finance and home to decide on matters of vital importance to the states? How many times have some states raised this question in the Inter-State Council (ISC) and demanded clearance by the ISC of the composition and terms of reference of the finance commission? How can one agree with you that demanding that the commissions’ awards be discussed in the Inter-State Council “prior to their being acted upon” amounts to questioning the very institution of the commission? Kindly recall that it was at the initiative of the centre that the Tenth Finance Commission (TFC) proposal for an Alternative Scheme of Devolution was discussed at the Inter-State Council. The EPW had commented upon it editorially.