Eighth Finance Commission s Award-Lessons We Can Now Draw

What it is that a Finance Commission ought to be principally aiming at? If the commission feels obliged to take as given the revenues and non-plan expenditures the centre and the states are 'committed3 to raise or incur, it is only natural that a few states will have non-plan surpluses while a large majority will have deficits. Also, this approach perpetuates a system under which there is inducement to raise a minimum of revenues and enter into a maximum of non-plan expenditure commitments.