Chief Minister Akhilesh Yadav has written a letter to Prime Minister Narendra Modi saying that following recommendation of 14th Finance Commission the state is set to lose over Rs 9000 crore as centre’s share and demanded that old method of state-centre share formula should be adopted.
“Though the 14th Finance Commission has increased state’s share from 32 per cent to 42 per cent, which suggests that state would get more from Centre. But the fact is that centre’s share in centrally sponsored schemes have been slashed resulting lesser share for UP from central schemes,” Yadav said in his letter which was released to media on Friday.
He said states like Uttar Pradesh will suffer following Finance Commission’s decision to stop grants to states in select projects and de-link some of the centrally sponsored schemes. Thus, there is a sharp decline in UP’s share in central schemes, he said.
“The financial devolution carried out under the formula of 14th Finance commission will provide Rs 94,313.46 crore and if the formula of 13th Finance Commission was adopted UP should have got 1,03,371 crore. Thus, UP will get Rs 9057.73 crore less than last year,’ Yadav said in his letter.
The 14th Finance Commission has added a new criterion of forest cover for devolution of Central taxes. The commission said that a large forest cover provides huge ecological benefits and this should be protected.
“The panel has assigned 7.5 per cent weight to forest cover for determination of the shares of taxes to the states. With UP having less forest cover the state is set to lose its share. This serves as an important indicator of fiscal disability,” Yadav said Yadav said with the addition of the new criterion, Uttar Pradesh is the biggest loser as its share has reduced from 19.677 per cent in 13th Finance Commission to 17.959 per cent now under 14th Finance Commission.
“Uttar Pradesh is one of the most backward states of India. Therefore previous governments had helped state in implementation of projects for welfare of poor, dalits and people living in Bundelkhand region. The 13th Finance Commission had also earmarked funds for construction of roads, bridges and schools. All these have stopped which will affect poor states like UP,” Yadav said. He wrote in his letter that in this scenario UP will have to finance implementation of central schemes that will affect development of the state.