A federal structure of governance should ideally manifest as a harmonious, balanced and cooperative coexistence of Central and State governments. Sadly, seldom is anything ideal or perfect. Going by that truism, the tussles between the central and state governments in India should certainly be global case studies. While the Centre and states are expected to complement and supplement each other as situations demand, in practice, the system in India has worked mostly on the principle of blamestorming or finding faults with each other.
Our system is one that only has avenues for facilitating in finding excuses for failures and not solutions. It is in such a context that the recent meeting of the Niti Aayog could also be viewed. The body in itself may be a rehashed version of the Planning Commission; but in terms of functioning, it does not represent the revolutionary change it was touted and expected to produce. Many states are unhappy with the way the Niti Aayog is functioning. Odisha is among them and has shown its disgruntlement, the most latest by neither the chief minister nor the finance minister representing the state at the governing council meeting held 17 June. The chief minister made it clear that he would not attend the meeting as the demands of Odisha placed before the Aayog have not been considered favourably and no action was forthcoming on earlier demands.
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The state had pointed out that although the 14th Finance Commission had paved the way for devolution of 42 per cent share of central taxes to states from the divisible pool, the actual funding received from the Centre had dropped as funds for Centrally Sponsored Schemes had been cut short in the absence of clarity over Centre-state sharing arrangements under the revised devolution. The state had also pointed out that central schemes such as Special Plan for KBK (Kalahandi-Bolangir-Koraput) scheme, Integrated Action Plan (IAP) for LWE (Left Wing Extremists) affected districts and Backward Regions Grant Fund (BRGF) have been discontinued.
Odisha, which the chief minister has claimed has shown satisfactory progress in different sectors and is “no longer like a BIMARU state”, is still greatly dependent on Central funds for its development just as other states. It can ignore central funding only at its own peril.
The state has also announced that it would not implement the Ayushman Bharat scheme of the central government, pointing out that the recently announced state scheme — Biju Swasthya Kalyan Yojana — will benefit more people than the central scheme and that it was more efficient than the central scheme. It has also stated that the scheme would be entirely funded by the state. Such autonomy is vital and must be allowed for the benefit of people. However, it is to be remembered that the Centre today unjustfiably holds the purse strings of states more tightly than ever, with the coming of GST and the resulting shrinkage of tax nets and allocations. Also include the long term and undue interference the Union government has been practicing in mineral related royalty issues that have deprived the state for no reason. Another big hurdle posed by the 15th Finance Commission is the assessment of devolution of funds based on the Socio Economic and Caste Census 2011, which places states that have actively implemented population stabilisation measures at a disadvantage. The chief minister’s decision that he would not take part in the Niti Aayog meeting could have been based on the principled stand that it makes no sense in attending meetings that do not produce desired results. However, some may argue that the absence of leaders who are the voice of the people at forums where decisions are said to be taken for the common good produces a vacuum in policymaking that allows room for further decay to set in. By keeping away from this meeting the Odisha CM has given a clear message that he does not believe in the system any more. Steps need to be taken to make it function and a corrective mechanism is required to be put in place. Under the federal setup, no state can expect its issues to be addressed without utilising opportunities provided to raise them. Odisha too needs the Union to listen and act on its genuine demands. This neglect has been happening since the past decade. Now, however, the BJP ruled government at the Centre has gone berserk in demolishing the federal structure. The issues being faced by the state governments in Delhi, West Bengal, Punjab and other non BJP ruled states are glaring examples. The states need to progress without hindrance from the Central government, for sure. But they cannot progress in isolation under a federal system if the Centre, instead of being assistive, goes on a collision course.
