Accountability Initiative (AI) released two research papers on fiscal devolution–the dynamics of decentralisation between the union and state governments; and between the state governments and local governments in India–titled: State of Social Sector Expenditure 2015-16 and PAISA for Panchayats 2016.
The first report focused on analysing trends in state budgets in the context of the implementation of the recommendations of the Fourteenth Finance Commission (FFC) that mandated enhanced devolution of the divisible pool of taxes between the Union and state governments. The second report studied trends in devolution to local governments in Karnataka.
Both reports were released on 3 June, 16, and the discussion comprised the following sessions (videos linked):
- Yamini Aiyar from AI, in her opening address (above), reflected on the importance of the FFC and the changing architecture of spending public money for social sector programmes.
- Arvind Subramanian, Chief Economic Advisor to the Government of India, expressed his views on the present scenario of social spending in India.
- Dr Pinaki Chakraborty, professor at the National Institute of Public Finance, expanded on the key findings of the report, State of Social Sector Expenditure in 2015-2016, bringing attention to the Centrally Sponsored Schemes (CSS), in particular.
- Dr Indira Rajaraman, member of the Thirteenth Finance Commission of India, elaborated on how the study, PAISA for Panchayats, contributed to informing the dialogue on devolution in the country.
- Santosh Mathew, Joint Secretary, Ministry of Rural Development, highlighted the need to build a transparent, real-time fund flow and tracking system within the government, including suggestions on how to achieve this.
- During the Q&A session, special invitee Arvind Srivastava, Secretary to the Government of Karnataka, shared about his experience as a state government official within the present systems of decentralisation and devolution.
Read an earlier question and answer with the AI team, contextualising the research on fiscal devolution here.