Hyderabad: Finally, starving ZPs, MPPs to get funds from 15th FC

Hyderabad: The Zilla and Mandal Parishads which have been facing fund crunch for the past five years may heave a sigh of relief as the 15th Finance Commission grants will be released this year.

The Union Ministry of Panchayat Raj informed the State government that the FC grants to be released this year should be apportioned in the fixed ratio to the ZPs, MPPs and Gram Panchayats.

During the 14th Finance Commission period all the grants of FC were released to Gram Panchayats, thus starving the ZPs and MPPs for funds.

The Union Ministry of Panchayat Raj in its letter addressed to the State government said that the 15th FC has recommended grant-in-aid to all tiers of the Panchayat Raj in 28 States.

The recommended grants for Rural Local Bodies (RLBs) are in two parts, namely, Basic and Tied Grants, in the ratio of 50:50. The basic grants are untied and can be used by RLBs for location-specific felt needs, except for salary or other establishment expenditure.

The Tied Grants are to be used for the basic services like sanitation and maintenance of open-defecation free (ODF) status, supply of drinking water, rainwater harvesting and water recycling.

The 15th FC has worked out the total size of the grant to be Rs 60,750 crore for the period FY 2020-21 to the Rural Local Bodies and the State-wise distribution.

It has also recommended that its Grant, Basic and Tied, should be distributed to all the tiers of the panchayats by the States on the basis of the accepted recommendations of the latest State Finance Commission (SFC) and also in conformity to the guidelines of 15th FC.

Accordingly, the GPs should be given from 70 to 85 per cent, the MPPs should given from 10 to 25 per cent and the ZPs from five per cent to 10 per cent of funds. The distribution formula should be fixed by State Finance Commission.

The 15th Finance Commission has also stated that the distribution of funds within the GP, Mandal and ZP should be made as per the population of the unit. The exact proportions to the different tiers of RLBs in the State, in accordance with the stipulations, in the month of April, 2020 and inform the same to Government of India.

The first installment of the FC Grants would be released in the month of June, 2020. The State government should complete the exercise as per the schedule in order to enable RLBs to receive and utilise the grants in time.