Tamil Nadu Chief Minister and DMK President M K Stalin
Credit: PTI Photo
Chennai: Flagging the fast-changing demographic change resulting in rapid increase in the state’s elderly population, Chief Minister M K Stalin on Monday nudged the 16th Finance Commission to allot more funds to Tamil Nadu to make investments in various social sectors to fulfill the needs of the ageing population.
In his speech before the Finance Commission, which is on a five-day visit to the state, Stalin pushed the need for devolving at least 50 per cent of the divisible poll to state, including all non-tax revenues in the divisible pool of taxes through a Constitutional amendment or increase the States' share in the divisible pool to compensate for the loss.
He also urged the Finance Commission to put in place a mechanism to curb the indiscriminate levy of cess and surcharges with a recommended cap of 10 per cent, as existed during the 12th Finance Commission period and merging any excess collection into the divisible pool, and a unfirom 75 per cent share of the Union in any scheme that comes under the State subject.
Tamil Nadu has been opposing indiscriminate levy of cess by the Union Government complaining that the Centre doesn’t share the revenue it generates through the above method with states.
Stalin said Tamil Nadu’s share has reduced from 15.25 per cent in Income Taxes and 16.44 per cent in Union Excise duties to 4.079 per cent despite representing 6.12 per cent of the country’s population since the First Finance Commission.
On the demographic changes in the state, Stalin said the average age of the population in Tamil Nadu, as of now, is 36.4 years and it will increase to 36.4 years by the time the 16th Finance Commission completes its tenure.
“The average age is 9.5 years more when compared to Uttar Pradesh. This way, Tamil Nadu will emerge as the state with the highest elderly population even before we emerge as a developed state. This shows that we need to invest more in social sectors to fulfill the needs of the elderly,” Stalin said in his speech.
Stalin also exhorted the Commission to reduce the weightage given to income distance, area and forest & ecology criteria while increasing the weightage given to demographic performance and include new criteria such as Contribution to economy and share in urbanization within the formula for horizontal devolution.
“Alternatively, the Commission may simplify the formula to focus on fewer, effective criteria for determining inter-se resource shares. Income distance must be adjusted for PPP, Population must be derived using 1971 Census, demographic performance, contribution to economy and share in urbanization should form the criteria for horizontal devolution,” he added.
Contending that Tamil Nadu's 1,076 km coastline and varied topography make it highly vulnerable to natural disasters such as cyclones, floods, earthquakes, droughts, and landslides, Stalin said the allocations under the State Disaster Relief Management Funds and NDRMF have consistently fallen short of actual needs.
He also wanted the SDRMF’s corpus to be increased by 50 per cent for 2026–27, with 90: 10 funding pattern from the Union Government and states, an annual 10 per cent increment in the fund size during the award period, replacing the current 5 per cent and replace the disaster risk index with a new index incorporating parameters like coastline length and urbanisation.