Planning Commission

The Planning Commission was set up on 15 March 1950 by a Resolution of the Government of India in pursuance to commitment to social change through the social and economic goals of planned development.

The Planning Commission was entrusted with the task of making assessment of all resources of the country, augmenting deficient resources, formulating plans for the most effective and balanced utilisation of resources and determining priorities.

The Prime Minister is the Chairman of the Planning Commission, which works under the overall guidance of the National Development Council. The Deputy Chairman and the full time Members of the Commission, as a composite body, provide advice and guidance to the subject Divisions for the formulation of Five Year Plans, Annual Plans, State Plans, Monitoring Plan Programmes, Projects and Schemes.

The First Five-year Plan was launched in 1951 and the Eleventh Five Year Plan (2007-12) was approved by National Development Council (NDC) on December 19, 2007. The Twelfth Five Year Plan (2012-17) is currently under formulation.

For the first eight Plans the emphasis was on a growing public sector with massive investments in basic and heavy industries, but since the launch of the Ninth Plan in 1997, the emphasis on the public sector has become less pronounced and the current thinking on planning in the country, in general, is that it should increasingly be of an indicative nature.

Planning Commission plays an integrative role in the development of a holistic approach to the policy formulation in critical areas of human and economic development.

The emphasis of the Commission is on maximising the output by using our limited resources optimally. Instead of looking for mere increase in the plan outlays, the effort is to look for increases in the efficiency of utilisation of the allocations being made.

The key to efficient utilisation of resources lies in the creation of appropriate self-managed organisations at all levels. In this area, Planning Commission attempts to play a systems change role and provide consultancy within the Government for developing better systems.

With the emergence of severe constraints on available budgetary resources, the resource allocation system between the States and Ministries of the Central Government is under strain. This requires the Planning Commission to play a mediatory and facilitating role, keeping in view the best interest of all concerned. It has to ensure smooth management of the change and help in creating a culture of high productivity and efficiency in the Government.

The challenges are further magnified in the context of a federal structure where the responsibilities for policy making and implementation are fragmented across levels of government and coordination between them is often lacking.

The Commission on Centre-State Relations under the Chairmanship of Justice Madan Mohan Punchhi in its report has expressed that Planning Commission's role in the post-reform period should be that of coordination to ensure that the sectoral plans drawn by different ministries are in conformity with the overall objectives of the Plan. This may not require parallel subject matter Divisions in the Planning Commission. The practice of ministries seeking changes in approved projects may be dispensed with as long as sectoral allocations are adhered to. Also, the Planning Commission needs to concentrate on bringing about a system of multi-year budgeting in conjunction with the Ministry of Finance.