Planning Commission | Indian Constitution Download PDF

Though the Constitution specifically mentions several Commissions to achieve various purposes, the Planning Commission, as such, is not to be Planning found in the Constitution. ‘Economic and social . planning’ is a concurrent legislative power [Entry 20,List III]. Taking advantage of this Union power, the Union set up a Planning Commission in 1950, but without resorting to legislation. This extra-constitutional and non-statutory body was set up by a resolution (1950) of the Union Cabinet by Prime Minister Nehru with himself as its first Chairman, to formulate an integrated Five Year Plan for economic and social development and to act as an advisory body to the Union Government, in this behalf.
Set up with this definite object, the Commission’s activities have ‘ gradually been extended over the entire sphere of the administration excluding only defence and foreign affairs, so much so, that a critic has described it as “the economic Cabinet of the country as a whole”, consisting of the Prime Minister and encroaching upon the functions of constitutional bodies, such as the Finance Commission and, yet, not being accountable to Parliament. It has built up a heavy bureaucratic organisation which led Pandit Nehru himself to observe—
“The Commission which was a small body of serious thinkers had turned into a government department complete with a crowd of secretaries, directors and of course a big budding.”
According to these critics, the Planning Commission is one of the agencies of encroachment upon the autonomy of the States under the federal system. The extent of the influence of this Commission should, however, be precisely examined before arriving at any conclusion. The function of the Commission is to prepare a plan for the “most effective and f balanced utilisation of the country’s resources”, which would initiate “a process of development which will raise living standards and open out to the [ people new opportunities for a richer and more varied life”. It is obvious that the business of the Commission is only to prepare the plans; the implementation of the plans rests with the States because the development relates to mostly State subjects. There is no doubt that at the Union, the Planning Commission has great weight, having the Prime Minister himself as its Chairman. But so far as the States are concerned, the role of the Commission is only advisory. Whatever influence it exerts is only indirect, insofar as the States vie with each other in having their requirements included in the national plan. After that is done, the Planning Commission . can have no direct means of securing the implementation of the plan. If, that stage, the States are obliged to follow the uniform policy laid down by the Planning Commission, that is because the States cannot do without obtaining financial assistance from the Union. But, strictly speaking, taking ; advantage of financial assistance involves voluntary element, not coercion, and even in the United States the receipt of federal grants-in-aid is not considered to be a subversion of the federal system, even though it operates as an encroachment upon State autonomy, according to many critics.

But there is justification behind the criticism that there is overlapping of work and responsibility owing to the setting up of two high-powered bodies, viz., the Finance Commission and the Planning Commission and the Administrative Reforms Commission has commented upon it.There is, in fact, no natural division between ‘plan expenditure’ and ‘non-plan expenditure’. The anomaly has been due to die fact that the makers of the Constitution could not, at that time, envisage the creation of a body like the Planning Commission which has subsequently been set up by executive order. Be that as it may be, the need for co-ordination between the two Commissions is patent, and, ultimately, this must be taken over by the Cabinet or a body such as the National Development Council of which we shall speak just now, unless the two Commissions are unified—which would require an amendment of the Constitution because the Finance Commission is mentioned in the Constitution. On 13 August, 2014 the Narendra Modi Government scrapped the Planning Commission and replaced it with NITI Aayog (National Institution for Transforming India).