Nagaland seeks spl funding, points to geopolitical factors & 16 Pt agreement

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State government holds meeting with the 15th Finance Commission


Source: DIPR


State government held meeting with the 15th Finance Commission at Civil Secretariat Complex, Chief Secretary’s Conference Hall on 28th November 2018.


Chief Minister, Neiphiu Rio welcomed the Chairman, Member and Officials of the Fifteenth Finance Commission and hoped that the discussions and interactions will help the Commission to appreciate better the reasons and circumstances that make Nagaland unique and different from other States.


At the meeting he highlighted some important issues that are of concern to the State. He said that to supplement the revenues of Nagaland, there will be need for the Government of India to pay out of the Consolidated Fund of India; lumpsum each year for the development programme in the Nagaland; and Grants-in-aid towards meeting the cost of administration.



He stated that State financial position has deteriorated steadily, adversely affecting development activities  due to the Government of India discontinuing the grant of funds to cover the Balance from Current Revenue (BCR) Gap by granting Additional Central Plan Assistance (ACA) during the period of the Ninth Finance Commission.


Rio added that the normative approach of the Thirteenth Finance Commission has affected the state by denying its Special Category status and any special grant or treatment and State struggled to even release of pay and allowances to its employees on time. At the end of the Thirteenth Finance Commission, a huge budgetary deficit of Rs. 1811.85 crores, including the liabilities of works completed but not paid for.


He further stated that the revenue deficit continued on account of 10% increased tax devolution to the States from 32% to 42% has not benefited the smaller States, particularly Nagaland.


He also requested the Commission to consider setting aside 25% of the total devolution of share to the States for the Special Category States as against the 11.53% allocated by the Fourteenth Finance Commission which is found to be insufficient. Out of the 25%, 3% each may be allocated to States having geopolitical implications like Nagaland.


He pointed out that, one area in which our State are struggling is providing 10% State Share for CSS and flagship schemes due to resource constraints and a huge backlog of State share amounting to Rs. 294.05 crores because of which we cannot access the Central Share of 90% for these schemes and this has affected the infrastructure development in the State.


The Chief Minister requested the Fifteenth Finance Commission to recommend 100% Central Grant for funding CSS and Flagship Programmes as was intended in the 16 Point Agreement.



Rio also mentioned that our State is struggling with financial burdens caused by short release of funds. One relates to the provision of Specific Grants by the Thirteenth Finance Commission for implementation of specific need based projects based on which works have been completed. He added that State is struggling to maintain infrastructure created during the initial years of Statehood due to resource constraints.


Most of the government buildings are now more than 50 years old and beyond repair but the Government respite resource constraints, during the last 10 years spent Rs. 389 crores constructing 33 new Directorate buildings and replacing old buildings through Negotiated Loan from HUDCO at a high rate of interest, adding further to the financial burden of the state.


He also mentioned that being a hilly and land locked State, regular maintenance of roads is unavoidable due to loose and instability of the soil, maintenance of roads is frequent and high, and due to poor financial condition leaves no resources for repair and maintenance. The total fund required for maintenance of the infrastructural assets for the period of the Fifteenth Finance Commission have been worked out to Rs. 3458.00 crores.


He also highlighted on the required funds for new infrastructure on the construction of the New Raj Bhavan, completion of New High Court Complex, replacement of old and dilapidated Schools, hospitals, strengthening of power sector, infrastructure for tourism, etc. and the amount projected  is Rs. 7212.10 crores against 14 new infrastructure development works.



Rio also informed the Commission that the requirement of salary for the remaining 2 years of the Fourteenth Finance Commission is going to be high on account of two factors-the first being adoption of the 7th Pay Commission for the employees of the State Government with effect from, 1st January 2018. Since Nagaland had already adopted the Central Pay pattern for its employees, it was imperative to implement the 7th Pay Commission recommendations for the State employees as well. The current year 2018-19 alone carries an additional burden of Rs. 1272.00 crores on account of pay revision.


The second issue relates to compliance with the Right to Education Act (RTE), under which 1620 Primary Teachers and 1527 Graduate Teachers under Sarva Shiksha Abhiyan (SSA) and 931 Subject Teachers under Rashtriya Madhyamik Shiksha Abhiyan (RMSA) were recruited. These Teachers were appointed on regular basis through open recruitment examinations and paid regular salaries. However, under the new integrated scheme of the Samagra Shiksha Abhiyan (SMSA) from 1st April 2018, their salaries have been reduced by half, and States have been asked to bear the balance amount


He emphasized that this year during the monsoon, the State witnessed disaster of huge magnitude caused by heavy rainfall in which roads, bridges, buildings etc. suffered extensive damage all over the State. The total damage has been estimated to be more than Rs. 1040.63 crores, out of which, the cost of permanent restorative works is estimated to be Rs. 185.05 crores.


After 56 years of Statehood, Government of India has recently sanctioned establishment of a Medical College at Kohima with a project cost of Rs. 189.00 crores. The college is scheduled to start functioning by the year 2020 with an intake capacity of 100 seats. The State will require additional recurring expenditure of Rs. 154.97 crores on account of salaries for its faculty and staff, and operational cost of Rs. 149.15 crore during the period of the Fifteenth Finance Commission.



Rio requested the Finance Commission to consider providing Multi-Purpose Buildings in all the District Headquarters in order to preserve our tribal heritage, traditions and culture at an estimated cost of Rs. 120 crores which can be used as Cultural Centres to host the festivals of the tribes, for meetings, seminars, workshops.


He also lamented that Nagaland is the only State where there is no airport in the State capital. Therefore we have approached the Central Government for construction of a new Greenfield Airport at Ciethu near Kohima, for which 645.20 acres of land has been acquired. Another 398 acres is being acquired by the State to meet all requirements. He hoped that the Commission will be sympathetic to our requests, keeping in mind the special circumstances that have brought this State into existence.


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