In conversation with Preetha Nair, Kerala finance minister Thomas Isaac shares his concerns about the Terms of Reference (ToR) of the 15th Finance Commission. Excerpts:
What issue do southern states have with the ToR of the 15th FC?
Our initial concern was using the 2011 census as the base for calculations. The decline in fertility rates has been much higher in the southern states, therefore, we will suffer losses in the share of awards if 2011 is taken as the base year. But today, our protest has gone much beyond the population criteria. States—even Bengal, Punjab and Delhi—feel the ToR is biased and takes away the little advances made under the 14th Finance Commission, when the share of central taxes for states was increased to 42 per cent.
How much loss are the states likely to incur if 2011 is taken as the base year?
We don’t know exactly, but one can estimate from the hypothesis that if the 14th Finance Commission had used 2011 as the base year, losses as much as Rs 15,000-20,000 crores for Tamil Nadu and Rs 5,000-6,000 crores for Kerala could be predicted.
Why should states get more powers?
The Kerala government was in distress during the floods with little options to choose from. This shows the degeneration of the federal system. We cannot borrow unless the Centre raises our borrowing capacity, can’t raise taxes under the GST and can’t take grants from foreign governments.
Will this demand figure in the upcoming general elections?
The issue for debate in 2019 election should be “Is this the India we need?” We should have an India where all states should have more power to deal with contingencies. For this, we will have to defeat the BJP.