Prime Minister Narendra Modi has rightly decided to infuse innovative thinking into the development process and replace the Planning Commission with a suitably reformed body.

This thinking is based mainly on three considerations. First, many think the Commission is a hurdle in quick decision making. Second, it encroaches upon the autonomy of States in spending funds allotted to them, which is against the federal system. Third, and the most important, reason is that the Plan Panel should mostly work as a “Think Tank” — an advisory body.

Few would disagree on these. However, the Government must be very clear on what it exactly wants to do.

The Chinese model It appears that the new panel is being modelled on the National Development and Reforms Commission (NRDC) of China. The NDRC is also responsible for processing and providing economic information/statistics to its provincial governments and central departments.

In India, a similar role is already being performed by the Ministry of Statistics and Programme Implementation (MSPI). The Central Statistical Organisation (CSO) under MSPI collects, collates and analyses information and provides it to all ministries, States, foreign missions and several other organisations.

This is in addition to the CSO’s two important functions of preparing National Accounts and Industrial Statistics reports. The MSPI also performs the function of project implementation and monitoring.

The question is whether the new panel will also perform the functions of MSPI. If it will, the MSPI will have a restricted role. There is need for clarity on this before the new panel’s scope is decided.

In the proposed set-up, the allocation of funds to States and Central ministries is sought to be made by the Ministry of Finance (MoF), instead of the Planning Commission.

It raises a question, does the finance ministry have the necessary expertise to scrutinise the schemes of States and Central ministries like the Plan Panel?

Certainly not. It means that the Ministry of Finance needs to be strengthened with subject matter experts. Does it really not mean that, we are adding to the existing strength of the finance ministry?

And, if the current crop of experts with the Planning Commission were to join the MoF for this role, that would run the risk of old thinking persisting, defeating the very purpose of reforming the Plan Panel.

Expert issues Earlier, plans were being prepared by the Commission in consultation with the States and Central ministries. Under the new dispensation, it is not yet clear who would perform this function.

Also, who would carry out mid-term appraisal of plan implementation — MoF? Does it have the competent staff?

We also have to take a call on the future of the Programme Evaluation Organisation and some divisions of the Planning Commission. Would they be pruned or, in part, shifted to MoF?

The National Development Council (headed by the Prime Minister, chief ministers, Central cabinet ministers and advisors to the Plan Panel as its members) is responsible for approving our national development agenda.

It would thus be appropriate to organise a meeting of the NDC, before taking any decision on replacing the Commission with a new body.

If these precautions are not taken, the new body will be just old wine in a new bottle.

The writer is a former director of the CSO