Karnataka - Bangalore

Panel favours more funds for panchayat raj institutions

Bangalore: Chairman of the Third State Finance Commission A.G. Kodgi on Tuesday presented the Commission’s final report/recommendations to Chief Minister B.S. Yeddyurappa.

Accompanied by members Mahendra S. Kanthi and T. Thimme Gowda and K.R. Shashidhar, Member Secretary, Mr. Kodgi urged the Chief Minister to part 33 per cent of the State’s Net Own Revenue Receipts with the panchayat raj institutions (PRIs) and urban local bodies (ULBs) in the ratio 70:30.

The PRIs and ULBs have been recommended 23 per cent and 10 per cent of the above grants, respectively. The commission has said that the statutory development grants distributed was grossly inadequate and its distribution at a flat rate per panchayat was inappropriate.

Selection of indicators and applying weightages thereon for determination of share of each village panchayat would be cumbersome. Instead, the commission recommended a pattern of distribution for statutory development grants to the village panchayayts. They were 14 per cent for category I panchayats with population below 4,000, 71 per cent for the category II panchayats with population 4,001 to 8,000 and 15 per cent for the third category with population above 8,000.

The commission has noted the disparities prevailing across the regions of the State, and the findings and recommendations of the Dr. D.M. Nanjundappa Committee report and contemplated additional statutory development grants. The other pattern is a fiscal responsibility- based incentive grant for the better performing village panchayats.

A village panchayat under the category I has been recommended Rs. 9 lakh, a year, while those under the category II and III would get Rs. 12 lakh and Rs. 15 lakh a year respectively. Similarly, each of the panchayats in all the “most backward taluks” have been recommended Rs. 3 lakh, a year. This is Rs. 2 lakh and Rs.1 lakh, in respect of panchayats in the “more backward taluks” and “backward taluks,” as mentioned in the Nanjundappa Committee report.

Mr. Kodgi said that Rs. 3 lakh should be given as incentive grant to a village panchayat every year and Rs. 50 crore should be set apart for it. The commission was of the view that it would be inappropriate and unreasonable to use any indicators and weightage to determine the share of panchayat raj institutions to pay salaries and arrears of pay. In view of this situation, the commission recommended that the salary component of officials working in the PRIs should be delinked while working out the total share of PRIs and ULBs.

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