Finance Commission meets representative of PRIs of Telangana

Hyderabad: The 15th Finance Commission today met the representatives of the Panchayati Raj Institutions (PRIs) of Telangana on Monday. They had detailed discussions on several issues highlighted by the representatives and sought by the Commission. 

As per the basic information on PRIs of Telangana, as provided by State Government, the Telangana Panchayat Raj Act, 2018 was enacted to strengthen local self-governance in the State. Only 10 out of 29 functions envisaged in the Eleventh Schedule of the Constitution devolved to PRIs. Accounts are maintained upto 2017-18 & audited upto 2016-17. SFC-I of Telangana, constituted on March 16, 2015 is expected to submit its report by January 2, 2020. The State Government has been releasing funds currently as per the recommendations of SFC-III (appointed by erstwhile AP). 

Number of local bodies (as on January, 2019) are 13,198. They include Zilla Parishad (ZP) -9; Mandal Praja Parishad (MPP) - 438 and Gram Panchayat (GP) - 12,751. 

Own tax revenue of ZP & MPP is almost negligible, being less than 0.05% of total revenue in 2016-17 and 2017-18. However, it constituted almost 23% for GP in these two years, mainly from immovable property tax. Own non-tax revenue of each tier of PRIs was less than 5% of their total revenue in 2016-17 & 2017-18. 

Major source of revenue of GP is transfers from FC-XIV which comprised around 55% of total revenue of GP in 2016-17 & 2017-18. 

Major sources of revenue of ZP and MPP are grants-in-aid from State Government and assigned and devolved taxes. In 2016-17 and 2017-18, their share in total revenue varied from 60% to 84% for ZP and from 72%to 75% for MPP. 

According to CAG’s Report on Local Bodies, 2016-17, as per audit carried out in 5 ZPs, 25 MPPs, and 46 GPs for the period 2014-17, it has been found that PRIs did not have records detailing the inventory of land in their possession. This resulted in encroachment of PRIs land. The Rural Water Supply department failed to initiate timely action to identify the source of funding before taking up the water supply scheme leading to delay in completion of works in time. 

In devolution by FC-XIV to RLBs, of Rs. 180,262.98 crore of Basic Grant given to all States, Telangana got Rs. 4,837.75 crore (or 2.68%) of total grants. Similarly, under Performance Grant, Telangana got Rs. 537.53 crore out of Rs. 20,029.22 crore or 2.68% of Performance Grant. 

The FC-XIV had recommended grants for only gram panchayats out of 3 tiers of PRIs. The State Government was asked about its views on this arrangement.