Jaya asks Centre to reject Rajan panel report

Jaya asks Centre to reject Rajan panel report

Tamil Nadu Chief Minister J Jayalalitha on Wednesday urged the Centre to reject the Raghuram Rajan Committee report. She said the hurriedly drafted report was a thinly disguised attempt to provide intellectual justification to deliver resources to a potential political ally.

She also decried Union Finance Minister P Chidambaram for his attempt to undermine the work of the 14th Finance Commission by forming an expert committee for evolving a Composite Development Index of states. Jayalalitha asked Prime Minister Manmohan Singh to reject the report and allow the Commission to function freely.

“The bulk of the transfer of funds from the Centre to the states needs to take place based on the recommendations of the Finance Commission which is constituted every five years,” she said in a letter to the prime minister. “A committee set up by the Union Finance Minister under an executive order can never substitute the constitutionally mandated process of the Finance Commission,” she said.

“I have gone through the report carefully and I am seriously concerned about the callous approach that the Union Ministry of Finance has adopted regarding this extremely sensitive issue in Centre-state financial relations in the country", she said.

Stating that the 14th Finance Commission had already been constituted, by making an announcement in the Budget Speech of 2013-14, she said: “The Union finance minister has committed a grave constitutional impropriety and has deliberately sown seeds of confusion in an already well established mechanism of financial transfer from the Centre to the states evolved over the past several years. The 14th Finance Commission needs to be allowed to function freely,” she said.

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