Appointment of 16th Finance Commission Member

April 9, 2024

GS Paper II Indian Polity and Governance

Context

The Government has appointed Manoj Panda, former director at the Institute of Economic Growth as the full time member of the 16th Finance Commission.

Research areas: His research areas include monitoring and analysis of macro-economic trends and prospects, evaluation of alternative trade and fiscal policy options from the point of view of growth and distribution.

About 16th Finance Commission (SFC)

Chairman: Arvind Panagariya.
Full Time Members: A.N. Jha (Former expenditure secretary and member of the 15th Finance Commission)
- Annie George Mathew (Former special secretary of the department of expenditure).
- Niranjan Rajadhyaksha (executive director of Artha Global Niranjan Rajadhyaksha).
- Part-Time Member: Soumya Kanti Ghosh (State Bank of India’s group chief economic adviser).
Duration: It is tasked with defining the distribution of the Centre’s tax revenue to states for five years starting FY27.
- It will make its recommendations available by 31 October 2025, covering an award period of five years beginning 1 April 2026.

Finance Commission

About: The first Finance Commission was set up in 1951.

Set up under Article 280 of the Constitution, Finance Commission is a constitutional body formed by the President of India to give suggestions on center-state financial relations.

Core Responsibility:

To evaluate the state of finances of the Union and State Governments.
Recommend the sharing of taxes between them.
Lay down the principles determining the distribution of these taxes among States.

Working: It is characterized by consultations with all levels of government, thus strengthening the principle of cooperative federalism.

Composition: It consists of a chairman and 4 other members to be appointed by the President.

Nature of Recommendations: Advisory in nature, not binding on the government.

Qualifications: The Parliament has given the following specifications for appointing the members.

The chairman must have experience in public affairs while the other four members should be selected from amongst the following criteria:

A High Court judge or one qualified to become one;
An individual having specialized knowledge of finance and accounts of the government;
A person who possesses experience in financial matters and administration;
A person who has special knowledge of economics.

Also Read: Public Finance In India

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Appointment of 16th Finance Commission Member

Context

About 16th Finance Commission (SFC)