To forge a unified stand against what they see as a lopsided parameter, finance ministers from Kerala, Karnataka, Andhra Pradesh and the Union Territory of Puducherry met this week.
When the 14th Finance Commission introduced the change in ratio by including the 2011 Census data, it translated to a revenue loss of Rs 6,000 crore for Tamil Nadu, 19 percent compared to the 13th Finance Commission's allocation ratio, making it the worst affected state. "It is not the task of a finance commission to create roadmaps for fiscal management or impose its perception of what policies are good for the people of the state -that is for the democratically elected state governments to decide", he said.
One of the key concerns raised by the Southern finance ministers was the usage of 2011 Census data for devising the ToR, as opposed to using data from 1971, as in the case of the 14th Finance Commission, as states with larger growth in population since 1971 would benefit more compared to the others.
The next meeting will be held in Visakhapatnam early next month, in which Delhi, West Bengal, Odisha and Punjab are also expected to take part.
Many southern politicians have drawn considerable attention to the fact that the terms of reference (ToR) for the Fifteenth Finance Commission (FFC), as drawn up by the Centre, have said the basis for the population counts relevant for the division of funds must be the 2011 Census and not, as it was in the past, the 1971 Census.
The forum was also attended by Puducherry chief minister V Narayansamy while Tamil Nadu and Telangana stayed away.
Without going into further details, he said in the presence of Chief Minister Edappadi K. Palaniswami and Deputy CM O. Panneerselvam, that "the Union government is committed to cooperative federalism".
Among major states, Bihar (25.1%), Chhattisgarh (22.6%) and Jharkhand (22.3%) have the highest decadal (2000-2011) population growth rates, according to the 2011 census. The TN government has decided to make a representation to the 15th Finance Commission, seeking amendment of these ToR affecting devolution of funds to the State.
"Let me tell you, our critics seem to have missed, and they have missed something. There is no inherent bias or mandate in the ToRs of the 15th FC which can be construed as discriminatory against the states which made good progress in population control", he added.
The framing of the debate in the conclave of southern states comes against the backdrop of a slowdown in growth and revenue buoyancy. "Thus, a state like Tamil Nadu, which has devoted a lot of effort, energy and resources towards population control would certainly benefit", Mr Modi said while inaugurating a slew of projects at the Cancer Institute (WIA) here.