15th Finance Commission – Guidelines for Panchayati Raj Institutions

1. Chairperson & Members

  • Chairperson: Shri N. K. Singh
  • Appointment: 27 November 2017
  • Recommendation Period: 1 April 2020 – 31 March 2025
  • Members: Shaktikant Das, Dr. Anup Singh, Ashok Lahiri, Ramesh Chand
  • Secretary: Arvind Mehta

2. Fund Structure

  • Fund provided by the Central Government for strengthening rural local self-government institutions.
  • Two types of grants:
    1. Basic / Untied Grant: 50% (can be used flexibly for local needs, excluding salaries and establishment)
    2. Tied Grant: 50% (restricted to specific purposes)
  • Distribution: Available to Zilla Parishad, Panchayat Samiti, and Gram Panchayat levels.

3. Fund Allocation Basis

  • Based on 2011 Census population and area of the state.

4. Operational Guidelines

A) Tied Fund

Primary Uses:

  1. Sanitation & Hygiene:
    • Construction of public toilets and urinals
    • Covered drains, wash basins on streets
    • Compost/organic fertilizer, gobar gas plants
    • Solid waste collection and transportation (garbage collection vehicles)
  2. Drinking Water & Water Conservation:
    • Expansion and maintenance of tap water schemes
    • Repair of wells, handpumps, and water tanks
    • Installation of RO plants
    • Roof water harvesting, watershed management
    • Recharging of public wells

B) Untied Fund

  • Can be used flexibly for local priority needs (excluding salaries and establishment costs)
  • Examples of eligible uses:
    • Maintenance and repair of village roads and footpaths
    • Installation and maintenance of LED/solar street lights
    • Construction and maintenance of crematoriums
    • Public libraries, children’s parks, playgrounds
    • Rural markets (“Rural Haat”)
    • Emergency support during natural disasters or epidemics
    • Solid waste management
    • Preparation of biodiversity registers under Biodiversity Act 2002
    • Drainage and waterlogging management

5. Expenditure Prohibited

  • Double spending on the same project
  • Salaries, honorarium, ceremonies, T.A./D.A.
  • Cultural programs, decorations, prizes, inaugurations
  • Vehicle purchase

6. Key Points

  • 50% of the tied fund must be spent on drinking water and sanitation.
  • Untied fund can be used flexibly according to local priorities.
  • All funds should be used for rural development and public welfare.