Himachal CM's statement on Central grants misleading: Nadda

Dharamsala, February 19, 2016: Union Health and Family Welfare Minister J P Nadda today termed the statement made by Himachal Pradesh Chief Minister Virbhadra Singh regarding stoppage of Centre's grant as completely misleading and an attempt to divert attention from collapse of governance in the state.
In a Statement issued here on Friday, Nadda said, “Contrary to the Himachal CM's misleading assertion, NDA government has recommended highest ever increase in vertical tax devolution from 32% to 42% for all states including HP by accepting the recommendations of the 14th Finance Commission (FFC).”
Union Health Minister further added, "This historic rise in central devolution and grants to the state is because of the efforts of the NDA government. NDA government has also taken a historic decision to increase the ratio of central government share in all core schemes under CSS to 90:10 thus meeting a long standing demand of the State of Himachal Pradesh in this regard. Many of the centrally sponsored schemes like IAY, Sarv Shiksha Abhiyaan, RMSA, Command area development scheme etc. where in the state government share used to be in the range of 25 to 35% has been brought to 10% state share thus giving a substantial relief to Himachal Pradesh. By maintaining 90:10 funding for these States, NDA government has devolved much more funds than the UPA. Unfortunately, HP has frittered away this windfall on non-productive assets. The CM is still functioning in a dole and patronage mode. Contractors are determining investment priorities of the State."
The Health Minister said, "Central government is committed to fiscal devolution in the true spirit of cooperative federalism. Due to liberal release of central government grants by NDA government to Himachal Pradesh, state is in a much better financial position to raise the spending in social and economic sectors. I would urge the state government to spend this enhanced allocation of funds from the Central government wisely for better social and economic development of the state."
"All the cost disabilities of Himachal Pradesh like low level of economic activities, remoteness and proximity to international borders etc. have also been taken care of while determining its share in Central divisible pool. A total tax devolution of Rs. 28225 crore has been estimated to Himachal Pradesh for the period 2015-20 against actual release of Rs. 11,131 crore during the period 2010-15, an increase of Rs. 17,094 crore over a period of five years. Besides, grants-in-aid has also been recommended for the State of Himachal Pradesh to the tune of Rs. 43810 crore for the period 2015-20, an increase of Rs. 33356 crore over actual release during the period 2010-15," said Sh. Nadda
During 2015-16 alone, tax devolution to Himachal Pradesh is estimated to be Rs. 3744 crore which is Rs. 1100 crore more than Rs. 2644 crore released during the previous year 2014-15. In addition, FC grants of Rs. 8436 crores (including the RD grant of Rs. 8009 crore), will also flow to the State during 2015-16, which is more than six times of Rs. 1109 crore release during previous year. Thus, funds transfer to Himachal Pradesh during 2015-16 alone is estimated to have increased by 86% to Rs. 12179 crore from Rs. 6548 crore released during 2014-15. The raise in tax devolution and grants in aid has been much higher as compared to the block grants like NCA, SCA, SPA which have since been subsumed.
It may be recalled that during the meeting of State Planning Board on 15th of February, Himachal CM had expressed concern regarding stoppage of release of grants to the tune of Rs 3000 Crore annually by the central government under the Normal Central assistance (NCA), Special Central assistance (SCA) and Special Plan assistance (SPA) and reduction of central share is CSS from 90:10 to 80:20, Sh J P Nadda, Union Health Minister today said that the statement made by Honorable CM is misleading and hides important facts.