← All questionsGS2 · 2013 · Governance ·13th Finance Commission and Local Bodies
MAINS 2013
GS2
10 marks

Discuss the recommendations of the 13th Finance Commission which have been a departure from previous commissions for strengthening local government finances.

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7 min
200 words

What the examiner wants

Discuss how the 13th Finance Commission broke from earlier commissions on local body finance.

DiscussExplain the different sides of the issue, use evidence, and finish with a balanced view.

Demand-wise check

  1. 1Grants linked to divisible pool (about 2.5%) instead of fixed amount, so they grow with tax revenue≈35 words
  2. 2Split into basic grant and performance grant tied to conditions (budget supplements, audit, ombudsman, State Finance Commission reports, property tax boards, service standards)≈35 words
  3. 3Special area grants for Fifth/Sixth Schedule and excluded areas≈35 words
  4. 4Impact and limits: states delayed compliance; later 14th and 15th FCs built on it≈35 words

Open in about 30 words and close in about 30.

Answer plan

Constitutional base (Article 280(3)(bb),(c))Earlier approach13th FC departuresImpactConclusion

Where marks usually go

  • Writing about tax devolution to states instead of local bodies
  • Missing the performance-grant conditions

Draw this

  • Table: earlier FCs vs 13th FC on local body grants

Value addition

  • Report13th Finance Commission (Vijay Kelkar, 2010-15) linked local body grants to a share of the divisible pool.13th FC Report, 2009
  • ConstitutionArticle 280(3)(bb) and (c), added by the 73rd/74th Amendments, mandate FC to suggest measures for panchayats and municipalities.Constitution of India

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