Confusion persists on NITI Aayog’s role

Deepak Razdan
NITI Aayog replaced Planning Commission as the Government’s ‘Think Tank’ on 1st January, 2015 but doubts persist how will this advisory body be effective when it can allocate no funds to back up its advice.
Instituted by a Union Cabinet Resolution, the ‘Think Tank’ has been conceived to give Governments at the Central and State levels strategic and technical advice on policies and best practices. But, unlike its predecessor, the Planning Commission, it does not deal with funds at all.
The Planning Commission too brought out policy papers and influenced the Central and State governments, but it wielded a stick also. After preparing the Five-Year and Annual Plans through an objective method of resource allocation, it undertook periodic appraisals of the Plans’ implementation and suggested corrections as required. The State Governments and Central Ministries, which received funds under the Plans, could not take the funds flow for granted, if there were deviations and delays.
NITI Aayog’s functions have been defined as encouraging cooperative federalism, working as Think Tank, and implement, monitor and evaluate programmes assigned to it. To ensure a smooth transition, NITI Aayog has been declared as successor in interest to the Planning Commission. The Twelfth Five-Year Plan (2012-17) is therefore continuing and will run its full course.
To enforce cooperative federalism, and to recognize that strong States make a strong nation, the NITI Aayog constituted three Sub-Groups of 10 or more Chief Ministers to deliberate on such subjects as Swacch Bharat Abhiyaan, Skill Development and Rationalisation of Centrally Sponsored Schemes (CSS).
Due to proliferation of the CSS, the demand for their reduction and rationalization was growing over the years. The Planning Commission undertook an exercise in consolidating them and their number fell from 147 to 66. The CSS are formulated in subjects from the State Lists to encourage States to prioritise in areas that require more attention. Central funds are routed either through the Consolidated Fund of the States or transferred directly to State or district level autonomous bodies and implementing agencies. A certain percentage of the CSS expenditure is assigned to the State Governments, which many of them find difficult to meet.
The NITI Aayog Sub-Group headed by the Madhya Pradesh Chief Minister, Mr Shivraj Singh Chouhan, received perspective from the Central, State and UT Governments that the number of CSS should be reduced for improving their visibility and impact, and their focus should be on the National Development Agenda where the Centre and the States will work together in a spirit of Team India.  Accordingly, existing CSS should be divided into Core and Optional schemes. Amongst the Core Schemes, those for social protection and social inclusion should form the ‘Core of the Core’ like MGNREGA and be the first charge on available funds for the National Development Agenda.
The Union Budgets which indicate the amount of money involved in the CSS, had already initiated some changes before the Sub-Group’s report. In the 2015-16 Budget, CSS are classified as Central Assistance to State Plan (CASP). The 2014-15 Budget had made provisions for 66 CSS of which 17 large schemes were designated as ‘flagship’ programmes. Post-14th Finance Commission which has raised devolution to Sates from 32 per cent to 42 per cent of the net Union Tax Receipts, the BE for Central Assistance to State Plan (CASP) has been reduced from Rs. 3.38 lakh cr in 2014-15, to Rs. 2.05 lakh cr in 2015-16
In view of the preponderance of CSS being interventions in key sectors of national importance, the Government of India has retained 50 of the 66 ongoing CSS under its direct charge in the Budget 2015-16. The balance are being either taken into the Central sector (implemented by the Central Ministries), or have been transferred to the States. It remains to be seen how the States react to the transfers of the Schemes to them.
The Sub-Group on Skill Development, headed by the Punjab Chief Minister, Mr Prakash Singh Badal, was asked to suggest ways to bridge the huge gap in the country’s skilled manpower. Today, less than five per cent of India’s potential workforce gets formal skill training to be employable and stay employable. The Sub-Group recommended that industry be incentivized to set up training institutions in PPP mode to facilitate availability of trained manpower for big and MSME units, and to adopt existing government ITIs and polytechnics. It has proposed a new law on Right of Youth to Skill Development to make training of youth by the Government mandatory, while suggesting that half of the two per cent CSR funds be devoted to skill development initiatives.
The Swacch Bharat Abhiyaan, a programme on cleanliness and waste management, was launched by the Prime Minister, Mr Narendra Modi, on Gandhi Jayanti of 2014, and the NITI Aayog Sub-Group headed by the Andhra Pradesh Chief Minister, N. Chandrababu Naidu, was asked to prepare its blueprint. Census 2011 showed the rural household toilet coverage stood at 32.7 per cent and urban household toilet coverage at 87.4 per cent. Going by the magnitude of the problem, the Sub-Group recommended steps to encourage  behaviour change, financing, a regulatory framework, and technological support with strong hand-holding from the Centre.
As far as the Think Tank functions of the NITI Aayog are concerned, it is still to build up its pool of domain experts, the Knowledge and Innovation Hub. To make expert advice available, NITI Aayog constituted an “Expert Committee on Innovation and Entrepreneurship” which has made recommendations to operationalise the Atal Innovation Mission (AIM) and the Self-Employment and Talent Utilisation (SETU) programme announced in the 2015-16 Union Budget, suggesting how to encourage people launch their own enterprises, motivated from their own innovative spirit and technological talents.
The relevant issue on the first anniversary of NITI Aayog is how will the new body ensure recommendations of its expert groups are implemented. Wherever now the issue of funding arises, the States will need to do bilateral bargaining with individual Central Ministries like Health, Education etc, most of whom have no experience to deal with the States directly. Some States are too well-known to beat others in advancing their claims. The other avenue for finance is the Finance Ministry which works under fiscal deficit pressures. Some Special Category States were used to liberal grants from the Planning Commission and where do they look for such funding. Minus the power to fund, and to regulate funding to ensure there is no diversion of funds by the States, NITI Aayog is set to emerge as a hub for academic reports, and a platform for inconclusive Centre-States talks. (IPA )


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