FFC recommendations - Budget & Economic Survey

Q.  Which of the following statement / s is / are correct?

1) Sector specific grants are continued from the Thirteenth Finance Commission to the Fourteenth Finance Commission (FFC).

2) The FFC has recommended reductions in Grant-in Aids and Central Assistance to States (CAS).

3) The FFC has recommended grants to rural and urban local bodies, performance grant, grants for revenue deficit.

- Published on 06 Aug 15

a. Only 1 and 2
b. Only 1 and 3
c. Only 2 and 3
d. None of the above

ANSWER: Only 2 and 3
 
The FFC has not made any recommendation concerning sector specific-grants unlike the Thirteenth Finance Commission. CAS has become more and more discretionary in recent years. Grants in statement 3 are formula based and hence progressive.

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