New Delhi: The controversy about the 15th finance commission’s mandate allegedly not favouring states that did well in controlling population growth is a “needless" one as the Commission’s charter has no inherent bias against states that performed well in this count, finance minister Arun Jaitley said in his blog on Tuesday.

Jaitley’s statement coincided with a meeting of southern states in Kerala earlier in the day convened to express their apprehensions about the terms of reference of the 15th finance commission, which they fear offered no incentive for achieving progress in controlling population. The terms of reference of the Commission chaired by former revenue secretary N.K. Singh suggested use of census data of 2011 for allocation of resources, against 1971 census data used earlier.

“There is no inherent bias or mandate in the terms of reference of 15th finance commission which can be construed as discriminatory against the states which made good progress in population control," said the minister’s post.

Dismissing worries about the Commission’s mandate being loaded against any particular region, Jaitley said that nothing could be further from the truth.

The finance minister said that devolution of centre’s divisible pool of taxes to help states offer a minimum standard of services to people calls for assessing their needs on rational and equitable basis. Finance commissions use appropriate criteria to assess the true needs of states.

“Population proxies very well for the needs of the people in quantitative sense. Another criterion, the income distance, which captures very well relative poverty of people in the states, is used to assess qualitative needs. These two parameters allocate more resources to the populous and poorer states, which need additional funds for providing education, health and other services to the people," said the minister.

Jaitley said even though the 14th finance commission had no specific mandate for using 2011 census, it rightly used the 2011 census population data to capture the demographic changes since 1971 to make realistic assessment of the needs of the states. It allocated 10% weight to 2011 population.

The minister’s post said that in the case of 15th finance commission, there is specific inclusion of another reference—efforts and progress made in moving towards replacement rate of population growth. This, he said, recognizes the efforts of all the states which have done well in population control. It will allow the Commission to propose a specific incentive scheme to reward the states which have achieved replacement level of population growth. Also, if the 15th finance commission wishes to do so, it could assign appropriate weight to the progress made in population control while allocating resources, said the post.

“The terms of reference of 15th finance commission rightly balance both the ‘needs’ represented by latest population and “progress towards population control" very well", said Jaitley.

Mint reported on 16 January quoting 2011 census that population growth rates in states like Karnataka, Andhra Pradesh and Tamil Nadu are among the lowest in the country and that north Indian states such as Bihar and Chhattisgarh with higher rates of population growth may become relative winners in 15th finance commission’s award.

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