RTI rejections

Sachin - November 1, 2011

The Right to Information Act, 2005, contains several exemptions which enable public authorities to deny requests for information. RTI Annual Return Reports for 2005-2010 give detailed information on use of these exemptions to reject RTI requests. Exemptions to requests for information under the Act are primarily embodied in three sections – section 8, section 11, and section 24. Section 8 lists nine specific exemptions ranging from sovereignty of India to trade secrets. Sec 11 provides protection to confidential third party information. Sec 24 exempts certain security and intelligence organizations from the purview of the Act. Of these, sections 8(1)(j), 8(1)(d) and 8(1)(e) are respectively the three most frequently invoked exemptions for the period 2005-2010, cumulatively amounting to almost three-fourths of all exemptions invoked. orange Section 8(1)(j) provides protection to personal information of individuals from disclosure in the absence of larger public interest. This exemption was invoked over 30,000 times during 2005-2010, which amounts to almost 40% of all invocations of exemptions. Among ministries, the Finance Ministry has invoked this sub-section the most, followed by the Ministry of Communications and Information Technology. Section 8(1)(d) provides protection to trade secrets and intellectual property from disclosure in the absence of larger public interest. This exemption was invoked almost 15,000 times during 2005-2010, which constitutes 18% of all invocations of exemptions. As with sec 8(1)(j), the Finance Ministry has utilized this exemption the most, followed by the Ministry of Petroleum and Natural Gas. Section 8(1)(e) provides protection to information available to a person in his fiduciary relationship from disclosure in the absence of larger public interest. This exemption was invoked 11,639 times during 2005-2010, which accounts for almost 15% of all invocations of exemptions. The Finance Ministry has invoked this exemption more than any other ministry, both overall and for each individual year during 2005-2010. The Finance Ministry accounts for more than 50% of all invocations of this exemption, having invoked it over 6000 times. The Ministry of Petroleum and Natural Gas is second, with a little over 1000 invocations of this exemption. Ministry-wise Rejections As discussed above, Finance Ministry has a large number of rejections, perhaps because of the larger number of requests that it receives. It is also possible that the Finance Ministry receives a larger number of requests related to private and confidential information (such as Income Tax returns) as well as those which are held in a fiduciary capacity (such as details of accounts in nationalised banks). Adjusted for the number of requests received, the Finance Ministry tops the rejection rate at 24%, followed by the Prime Minister's Office (12%) and the Ministry of Petroleum and Natural Gas (11%). blue

Policy

Recommendations of the 15th Finance Commission for 2020-21

Rohin Garg - February 3, 2020

The Finance Commission is a constitutional body formed by the President of India to give suggestions on centre-state financial relations. The 15^th Finance Commission is required to submit two reports. The first report will consist of recommendations for the financial year 2020-21. The final report with recommendations for the 2021-26 period will be submitted by October 30, 2020. In this post, we explain the key recommendations of the report.

What is the amount of tax devolution to the states, and how is it being calculated?

The Finance Commission uses certain criteria when deciding the devolution to states. For example, income distance criterion has been used by the 14^th and 15^th Finance Commissions. Under this criterion, states with lower per capita income would be given a higher share to maintain equity among states. Another example is Demographic Performance criterion which has been introduced by the 15^th Finance Commission. The Demographic Performance criterion is to reward efforts made by states in controlling their population.

The 15^th Finance Commission used the following criteria while determining the share of states: (i) 45% for the income distance, (ii) 15% for the population in 2011, (iii) 15% for the area, (iv) 10% for forest and ecology, (v) 12.5% for demographic performance, and (vi) 2.5% for tax effort. For 2020-21, the Commission has recommended a total devolution of Rs 8,55,176 crore to the states, which is 41% of the divisible pool of taxes. This is 1% lower than the percentage recommended by the 14^th Finance Commission.

Table 1 below compares the new criteria with the criteria recommended by the 14^th Finance Commission.

Table 1: Criteria for devolution (2020-21)

Criteria	14^thFC 2015-20	15^thFC 2020-21
Income Distance	50.0	45.0
Population 1971	17.5	-
Population 2011	10.0	15.0
Area	15.0	15.0
Forest Cover	7.5	-
Forest and Ecology	-	10.0
Demographic Performance	-	12.5
Tax Effort	-	2.5
Total	100	100

Sources: Report for the year 2020-21, 15^thFinance Commission; PRS.

Uttar Pradesh and Bihar have received the largest devolutions for 2020-21, receiving Rs 1,53,342 crore, and Rs 86,039 crore respectively. Karnataka and Kerala saw the largest decreases in the share of the divisible pool with a decrease of 0.49% and 0.25% respectively. Table 2 below displays the state-wise breakdown of the share in the divisible pool and the total devolution.

Table 3: Share of states in the centre’s taxes

State	14^th Finance Commission		15^th Finance Commission		Devolution for FY 2020-2021
State	Share out of 42%	Share in divisible pool	Share out of 41%	Share in divisible pool	(In Rs crore)
Andhra Pradesh	1.81	4.31	1.69	4.11	35,156
Arunachal Pradesh	0.58	1.38	0.72	1.76	15,051
Assam	1.39	3.31	1.28	3.13	26,776
Bihar	4.06	9.67	4.13	10.06	86,039
Chhattisgarh	1.29	3.07	1.4	3.42	29,230
Goa	0.16	0.38	0.16	0.39	3,301
Gujarat	1.3	3.1	1.39	3.4	29,059
Haryana	0.46	1.1	0.44	1.08	9,253
Himachal Pradesh	0.3	0.71	0.33	0.8	6,833
Jammu and Kashmir	0.78	1.86	-	-	-
Jharkhand	1.32	3.14	1.36	3.31	28,332
Karnataka	1.98	4.71	1.49	3.65	31,180
Kerala	1.05	2.5	0.8	1.94	16,616
Madhya Pradesh	3.17	7.55	3.23	7.89	67,439
Maharashtra	2.32	5.52	2.52	6.14	52,465
Manipur	0.26	0.62	0.29	0.72	6,140
Meghalaya	0.27	0.64	0.31	0.77	6,542
Mizoram	0.19	0.45	0.21	0.51	4,327
Nagaland	0.21	0.5	0.23	0.57	4,900
Odisha	1.95	4.64	1.9	4.63	39,586
Punjab	0.66	1.57	0.73	1.79	15,291
Rajasthan	2.31	5.5	2.45	5.98	51,131
Sikkim	0.15	0.36	0.16	0.39	3,318
Tamil Nadu	1.69	4.02	1.72	4.19	35,823
Telangana	1.02	2.43	0.87	2.13	18,241
Tripura	0.27	0.64	0.29	0.71	6,063
Uttar Pradesh	7.54	17.95	7.35	17.93	1,53,342
Uttarakhand	0.44	1.05	0.45	1.1	9,441
West Bengal	3.08	7.33	3.08	7.52	64,301
Total	42	100	41	100	8,55,176

Sources: Reports of 14^th and 15^th Finance Commission; PRS.

What are the various grants recommended by the 15^th Finance Commission?

The Terms of Reference of the Finance Commission require it to recommend grants-in-aid to the States. These grants include: (i) revenue deficit grants, (ii) grants to local bodies, and (iii) disaster management grants.

14 states are estimated to face a revenue deficit post-devolution. To make up for this deficit, the Commission has recommended revenue deficit grants worth Rs 74,341 crore to these 14 states. Additionally, three states (Karnataka, Mizoram, and Telangana) have received special grants worth Rs 6,674 crore. The special grants are being given to compensate for a decline in the sum of tax devolution and revenue deficit grants in 2020-21 as compared to 2019-20.

The Commission has recommended a total of Rs 90,000 crore for grants to the local bodies in 2020-21. This amounts to an increase over the Rs 87,352 crore allocated for 2019-20 for the same. The new allocation is 4.31% of the divisible pool. Of this sum, Rs 60,750 crore has been recommended for rural local bodies, and Rs 29,250 crore for urban local bodies. These grants will be made available to all three tiers of Panchayat- village, block, and district.

To promote local-level mitigation activities, the Commission has recommended the setting up of National and State Disaster Management Funds. Recommended grants for the State Disaster Risk Management Fund is Rs 28,983 crore, while the allocation for the National Disaster Risk Management Fund is Rs 12,390 crore.

Apart from these, guidelines for performance-based grants and sector-specific grants have been outlined. The Commission has recommended a grant of Rs 7,375 crore for nutrition in 2020-21. Sectors for which sector-specific grants will be provided in the final report include: (i) nutrition, (ii) health, (iii) pre-primary education, (iv) judiciary, and (v) railways.

For more details, please see our summary of the report.

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