Lok Sabha Question No. 3511 (UNSTARRED), answered on 2017-03-23
Subject: Misuse of Funds in Panchayats
Ministry: PANCHAYATI RAJ
Asked by: RAM TAHAL CHOUDHARY

## GOVERNMENT OF INDIA MINISTRY OF PANCHAYATI RAJ

## LOK SABHA

## UNSTARRED QUESTION NO. 3511

TO BE ANSWERED ON  23.03.2017

## MISUSE OF FUNDS IN PANCHAYATS

## †3511. SHRI RAM TAHAL CHOUDHARY

Will the Minister of PANCHAYATI RAJ be pleased to state:

- a) whether the development expenditure of gram panchayats especially in Ranchi district of Jharkhand have been overstated by double fold and payments are being made accordingly which is the misuse of the budget allocated for panchayati raj institutions in the country;
- b) if so, the details of the procedure and rules to check the leak effectively; and
- c) the steps being taken/ proposed to be taken by the Union Government in this regard?

## ANSWER

## MINISTER OF STATE IN THE MINISTRY OF PANCHAYATI RAJ (SHRI PARSHOTTAM RUPALA)

(a)-(c)  :  'Panchayat'  being  a  State  subject,  undertaking  development  projects  in  the  Gram Panchayats (GPs) is primarily the responsibility of the concerned State Governments. However, under Fourteenth Finance Commission (FFC) award period 2015-20, substantial funds to the tune of  Rs.  2,00,292.20  crore  are  being  devolved  over  a  period  of  five  years  (2015-20)  to  Gram Panchayats  constituted  under  Part  IX  of  the  Constitution  for  26  States  including  Jharkhand  to support and strengthen the delivery of basic services including water supply, sanitation, including septic  management,  sewage  and  solid  management,  storm  water  drainage,  maintenance  of community assets, maintenance of roads, footpaths, street-lighting, burial and cremation grounds and  any  other  basic  service  within  the  functions  assigned  to  them  under  relevant  legislations, creation of reliable data base of local bodies' receipts & expenditure through audited accounts and for improvement of own source revenue of GPs.

Excess payment of Rs.24.81 lakh on purchase of Solar Street Light in 2013-14 and nonreceipt of Bank Guarantee of Rs.2.72 lakh under Zilla Parishad, Ranchi has been detected. Action has been initiated against Mukhia and Panchayat Sachiv of Concerned Panchayats. Recovery of the said amount has been initiated.

The State Government has issued detailed procedure for execution of schemes under FFC grants  to  the  Panchayats.  Further,  Ministry  of  Finance  (MoF)  guidelines  dated  08.10.2015  for implementation  of  FFC  recommendations  local  bodies  enjoin  upon  States  to  constitute  a  High Level Monitoring Committee (HLMC) headed by Chief Secretary for monitoring and concurrent evaluation  of  local  bodies.  Ministry  of  Panchayati  Raj  (MoPR)  has  constituted  a  Coordination Committee headed by Secretary, Panchayati Raj to inter-alia guide and support States and local bodies in the implementation of FFC recommendations, monitor progress of expenditure of grants by local bodies and suggest remedial measures as per the MoF Guidelines. State Governments are also  mandated  to  put  in  place  third  party  audit  mechanism.  MoPR  has  developed  Panchayat Enterprise Suite (PES) constituting 11 common core applications which cover the entire gamut of core  governance  functions  of  Panchayats.  These  application  together  foster  transparency  and accountability in the functioning of Panchayats.