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Union government must reduce number of central schemes to ease financial burden on states (Bihar Finance Minister) – Mintpaisa

Bihar Finance Minister Vijay Kumar Choudhary addresses the press conference after presenting the state budget 2023-24 during the budget session of the State Assembly, in Patna on Tuesday.

Bihar Finance Minister Vijay Kumar Choudhary addresses the press conference after presenting the state budget 2023-24 during the budget session of the State Assembly, in Patna on Tuesday. | Photo credit: ANI

The Bihar government will urge the Center to reduce the number of central programs to ease the financial burden on the states for implementing these projects, Finance Minister Vijay Kumar Choudhary has said.

interact with PTIMr. Choudhary stressed the need to restructure Centre-State fiscal relations and grant financial autonomy to the States.

He said the substantial increase in the number of Centrally Sponsored Schemes (CSS) in recent years has placed additional financial burden on a poor state like Bihar.

“The CSS forces states to reprioritize and puts poor states at a disadvantage. It has been found that the Center’s heavy spending on many programs ultimately results in reduced allocation from the Union Government. Therefore, we have decided to urge the Center to reduce the number of CSS in the United States,” he said.

“This will certainly enable states like Bihar to ensure greater flexibility in the implementation of certain programs and improve delivery. We will write to the Center soon in this regard and I will also request an appointment with the Union Finance Minister Nirmala Sitharaman to discuss the issue,” Choudhary said.

The state finance minister said Bihar’s economic growth rate at 10.98% was better than the national average of 7%.

“The Bihar government had forecast a growth of 9.84% in the financial year 2021-22. However, the actual growth of the state economy was 15.04%, the highest in the last decade. But Bihar is one of the poorest states in the country, so it deserves special financial assistance from the Centre,” he said.

Accusing the Center of not releasing sufficient funds for the CSS, the state’s finance minister said, “The BJP-led unity government is playing politics on several Center-sponsored programs, especially in Bihar has stopped releasing its share for various programs in the social, education and infrastructure sectors.

“In the majority of SSCs, state governments now pay the Center’s share out of their own coffers. At the same time, Bihar is also not getting its share of central taxes,” he said.

“Let me say very clearly that the financial health of Bihar is under strain due to the uncooperative attitude of the Centre…Why should the States spend from their own coffers to implement the babies of the Union government plan? asked Mr. Choudhary.

In most SSCs, the Union government’s share is now down to 50% from 75% previously, he said.

“Ideally there should be no more than 40 CSSs but at present there are over 100 such schemes,” the state finance minister said.

Echoing the Finance Minister’s concern, senior CPI official Atul Kumar Anjan alleged that it had become a practice of the NDA government at the Center to impose an additional financial burden on the states by changing the funding model of the CSS.

“In some cases, states are forced to spend more of their treasuries to manage SSC. Central schemes should neither increase the burden on the state nor be used to target poor states,” he said.

The Grand Alliance of Bihar comprises seven parties – JD(U), RJD, Congress, CPI-ML (Liberation), CPI, CPI(M) and HAM – which together have over 160 MPs in the 243-member Assembly.

Senior BJP leader and former state finance minister Sushil Modi, however, rejected Mr Choudhary’s claims.

“I find his statement very strange. Except for the North Eastern states, the central scheme funding model for the rest of India is the same. At the same time, the number of CSS cannot be reduced for some states,” he said.

“Government of Bihar should endeavor to meet the standards for effective implementation of CSS by removing anomalies. The standards are same for all the states. The Center has allocated huge amount of funds for road development, highways, airports and several other sectors including agriculture, tourism, fisheries, science and technology and rural development,” he added.


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