State Finance Commissions - How successful have they been in Empowering Local Governments?
- Manish Gupta & Pinaki Chakraborty
- Apr 2019
- National Institute of Public Finance and Policy (NIPFP)
- India
The paper reviews the reports of the latest State Finance Commisions (SFCs) of 25 states in India. This involves examining the status of constitution of SFCs, their functioning and the approach adopted by them in carrying out their task and the principles adopted by them in allocating resources to local governments both vertically and horizontally. It also quantifies the devolution recommended by the SFCs in order to get a comparative picture of funds devolved by them across states. It is observed that there is huge variation in the recommended per capita devolution across States. Is it that the state governments arbitrarily reject the recommendations or are the SFCs themselves to be blamed for non-acceptance of their recommendations?
