For the Financial Year (FY) 2020-21, the Fifteenth Finance Commission had earlier submitted its report for the Rural Local Bodies (RLB), the recommendations in the report were accepted by the Government. Based on it, the highest ever Grants in a single year was allocated to the RLBs for the FY 2020-21 of Rs 60,750 Crore.
The 1st installment of which, Rs 15187.50 crore was released to 2.63 lakh RLBs across 28 states in the country on 17th June 2020.
The Union Minister of Rural Development and Panchayati Raj, Narendra Singh Tomar further added that the 2nd installment of Rs 15187.50 crore is also expected to be released soon by the Finance Ministry.
Use of Grants by RLBs
In every FY the Central Government approves a specific amount of financial aid for the RLBs for ensuring proper infrastructural development work in the rural areas of the country. The grants provided are used for projects such as rainwater harvesting, safe drinking water connection, maintaining proper sanitation facilities to ensure rural areas can achieve and maintain the status of 100% Open Defecation Free (ODF).
How these Grants are Distributed?
The States Governments are responsible for the distribution of these grants to the RLBs. RLBs include all the tiers of panchayats (village, block, and district). The Grant is distributed by the State Government based on the recommended made by the State Finance Commission of the particular state and the maximum and minimum bands of pay that are recommended by the Fifteenth (15th) Finance Commission. The bands are 70-85% for Village Panchayats, 10-25% for Block Panchayats, and 5-15% for District Panchayats. 1st Installment of Highest Ever RLBs Released 1st Installment of Highest Ever RLBs Released