Arvind Panagariya on Freebies: Economist and 16th Finance Commission Chairman Arvind Panagariya said on Thursday (January 9, 2025) that people have to decide whether they want free things or they want better roads, good drainage system and better water supply facilities. He made this statement after a meeting between the Commission’s delegation and top ministers and officials of Goa.
To a question on funds allocated for state infrastructure being allegedly used to distribute freebies, Panagariya said if the money is given for projects, it is used for those purposes only. Should go. However, in a democracy, the elected government takes the final decision.
He said, “The decision is not taken by the Finance Commission. The Finance Commission can take up this issue in the interest of macro-economic stability. The Commission can say something at a general level but it cannot control how the state spends the money.”
Citizens should decide what they want: Arvind Panagariya
Panagariya said that the responsibility ultimately rests on the citizens, because they elect the governments. He said, “If citizens vote for a government based on free facilities, they will ask for free things. Ultimately, citizens should decide what they want. Do they want better facilities, better roads, better drainage facilities, Want better water or free stuff, including money transferred to your bank accounts.”
During the meeting with the commission members, Goa officials demanded a four-fold increase in the coastal state’s share under the share in central taxes. Chief Minister Pramod Sawant and many ministers attended the meeting.
Panagariya said that the Goa government has requested the Commission to increase its stake from 0.38 percent to 1.76 percent. This is practically four times Goa’s (current) share. The Finance Commission Chairman said that Goa has also sought Rs 32,706 crore to finance 13 special projects in several sectors.
He said that Goa suggested that the Centre’s share to the states should be increased from 41 percent to 50 percent. Panagariya said, “This is a common suggestion that has been coming from the states. Goa is the 15th state that we are visiting. 14 out of 15 states have said that the share should be increased to 50 percent. One state suggested That it should be 45 percent.”
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