Scrapping of venerable Planning Commission on the cards

By Jagdeep Worah
24 June 2014

The Planning Commission, responsible for India's Five-Year Plans almost since Independence, may be scrapped altogether, if the recommendations of the Independent Evaluation Office (IEO) are followed.

The IEO, set up by the previous United Progressive Alliance government, recommends in its report to the Prime Minister that the plan panel should be replaced by a 'reforms and solution commission' as a think-tank of experts with domain knowledge.

The Planning Commission is acting as a "control commission" and this must be changed, the IEO report, submitted to the Prime Minister today, says.

The IEO argues that the dominant role of the commission in allocation of resources to states raises Constitutional concerns, as it was set up as an advisory body by a cabinet resolution. The report suggested that the commission was impinging on the functions of the Finance Commission, a constitutional body with several checks and balances.

"It is clear that the Planning Commission in its current form and function is a hindrance and not a help to India's development. In my experience it is not easy to reform such a large ossified body and it would be better to replace it with a new body that is needed to assist states in ideas, to provide long-term thinking and help in reforms," IEO director general Ajay Chhibber said.

The IEO's assessment report said, "Since the Planning Commission has defied attempts to reform to be in line with the needs of a modern economy and the trend of empowering the states, it is proposed that the Planning Commission be replaced."

The IEO was set up by the UPA government in November 2010 to evaluate government schemes and programmes. It has found that the body exceeds the scope of its authority, particularly its influence on the allocation of funds to the states.

The IEO came up with a suggestion that the commission's role as an allocator of resources to the states should be taken up by the Finance Commission and the allocation of resources amongst the ministries should be carried out by a separate department of planning in the finance ministry.

It said that the opaqueness in the functioning of the plan panel is a matter of concern considering its role as a major allocator of resources to states and union ministries.

'Parking lot'
In its comments on how the Planning Commission has turned into a ''control'' commission, the note said the members of the panel were ''susceptible'' to pressures from the Prime Minister's Office (PMO) and this can lead to partiality in the allocation of resources amongst the states. 

The note was also critical of the panel being turned into a ''parking lot'' for IAS officers having no domain knowledge. With IAS officers reporting to the secretary, the panel was no different than central ministries in the manner of its administration, it added.

Prime Minister Modi has publicly sought the dismantling of the commission, saying it has outlived its utility in the modern economic era.

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