The Northeast states will have to pay like other states for centrally sponsored schemes if the Planning Commission has its way.
The commission, in its approach paper to the Twelfth Five Year Plan (2012-17), has stated that the share of special category states in centrally sponsored schemes was not uniform as the northeastern states contribute only 10 per cent while states like Jammu and Kashmir, Himachal Pradesh and Uttarakhand, contribute what states under the general category do.
There are 11 special category states — Arunachal Pradesh, Assam, Himachal Pradesh, Jammu and Kashmir, Meghalaya, Manipur, Mizoram, Nagaland, Sikkim, Tripura and Uttarakhand.
The 12th Finance Commission had recommended 90 per cent grants and 10 per cent loan formula for the northeastern states for centrally sponsored schemes and external aid. The other special category states get 70 per cent grants and 30 per cent loan for centrally sponsored schemes.
Himachal Pradesh chief minister Prem Kumar Dhumal had raised the issue of disparity among special category states in funding for the centrally sponsored schemes at the 55th meeting of the National Development Council in July 2010, saying there was no logic behind such differentiation.
The objective of centrally sponsored schemes is to address issues of national priority with focus on human development, poverty alleviation and rural backwardness. Funds for these schemes are transferred from the Centre to the states and the responsibility of implementing them lies with the states.
The general argument put forward by the Planning Commission in its concept note on rationalisation of centrally sponsored schemes is that it is its persistent effort to reduce and rationalise the schemes for effective administration at the ultimate ground level as a large amount of investments are made on this without adequate evaluation on the impact of these schemes on the beneficiaries.
The commission has called for reducing the number of centrally sponsored schemes to a few major ones, irrespective of any region.
Reacting to the commission’s proposal to increase the share of northeastern states in funding the centrally sponsored schemes, FiNER president R.S. Joshi told The Telegraph: “If the Northeast was to pay as others for getting money from centrally sponsored schemes, it would be ruined. We are not at all prepared for it as generating resources is difficult.”
A senior Assam government official said the commission’s recommendation could not and would not be accepted, as it would be disastrous. “This argument has been going on for some time but it cannot be accepted,” he said.
Economist and former Asian Development Bank (ADB) director Jayanta Madhab said it was time for the issue to be reviewed and the Northeast states could make a case. “The issue of utilisation of funds should also be seen,” he added.
A senior official in the North Eastern Council (NEC) said the region had always been favoured but they were not using the funds they had received properly. “States are not willing to pay even the 10 per cent share for getting money under the centrally sponsored schemes,” the official said. Sources said it was extremely difficult for the states of the Northeast to pay even 10 per cent.
“It is too early to reverse the decision. We never got the big investments, people here do not get loans easily,” economist Amiya Sharma, who is the executive director of Rashtriya Gramin Vikas Nidhi, said.
A Planning Commission team will visit the Northeast to get the region’s views on the approach paper. In the 2010-11 fiscal, 139 centrally sponsored schemes were in operation throughout the country. In 2011-12, five schemes have not been provided with any outlay, reducing the number of effective schemes to 134.
The commission also stated in its note that there were many schemes and programmes which were continuing year after year and, accordingly, budgetary support was being provided to these schemes only to achieve a set of pre-stated objectives of these schemes/programmes.
“Very limited effort is taken to justify the need of the scheme/programmes’ continuing operation for the next financial year. Sometimes non-achievement of stated objectives is given as the sole justification for the continuation of the schemes,” the note stated.