Question

Which of the following statements are correct about the composition of the Finance Commission?

1. The Finance Commission consists of a chairman and four other members appointed by the President.

2. The qualifications of the members are determined by the Parliament.

3. All members of the Finance Commission must have specialized knowledge of economics.

• A. 1 and 2
• B. 1 and 3
• C. 2 and 3
• D. All are correct

Answer 1

Answer:

A. 1 and 2

Finance Commission: Composition and Qualifications

• The Finance Commission is a constitutional body established under Article 280 of the Indian Constitution.

• It is responsible for recommending the distribution of financial resources between the Union and the States, and among the States themselves.

Composition of the Finance Commission:

• As per Article 280(1), the Finance Commission consists of:

  • A Chairman, who is appointed by the President.

  • Four other members, who are also appointed by the President.

• These appointments are made by the President, signifying the importance and constitutional mandate of the commission.

Qualifications of Members:

• The qualifications of the members of the Finance Commission are determined by the Parliament by law.

• This power is vested in Parliament under Article 280(2), allowing for flexibility in defining the expertise required.

• The Parliament has enacted the Finance Commission (Miscellaneous Provisions) Act, 1951, to specify these qualifications.

• These qualifications generally include experience in public affairs, finance, accounts, economics, and administration.

• While specialized knowledge of economics is often desirable and usually found among members, it is not a mandatory requirement for all members by constitutional provision.

Key Facts for Competitive Exams:

• The Finance Commission is constituted every five years or earlier if the President deems it necessary.

• The recommendations made by the Finance Commission are advisory in nature but are generally accepted by the government.

• The Chairman is usually a person who has had experience in public affairs.

• The other four members are typically chosen for their expertise in finance, economics, law, and public administration.