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Finance

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Finance is a simple task of providing the necessary funds (money) required by the business of entities like companies, firms, individuals and others on the terms that are most favourable to achieve their economic objectives."

Published in: Investor Relations

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  • 1. Panchayati Raj Department http://orissapanchayat.gov.in
  • 2. GENERAL GUIDELINES The Finance Commission is being set-up every five years by Government of India to discharge the mandate laid down in articles 270, 275 and 280 of the constitution to perform 3 different types of tasks:-  To recommend distribution, between Union and States, of the net proceed of taxes out of divisible pool.  To recommend the allocation between the different States of such proceeds, and  Thirdly, to recommend measures to supplement the resources of the Panchyats and Municipalities by augmenting the consolidated funds of individual States, taking into account the recommendations of the respective State Finance Commissions (SFCs).
  • 3. 13th FC Recommendations For augmenting the resources of rural local bodies in terms of award of grant based on certain principles. The grant have two main components. a) Basic Grant – For 5 years (2010-11 to 2014-15) b) Performance Grant – For 4 years (2011-12 to 2014-15) A small portion of grants is allocated to Special Area covered by the V & VI Schedules and areas exempted from the purview of Part X and XI (A) of the constitution. This grant is called “Special Area Basic Grant”, and accessible for all the five years to meet some of the development needs of these areas.
  • 4. Modalities of releasing 13 FC Grant During 1st year General Basic Grant is being provided to all GPs for implementation various development measures and basing on this performance as well as fulfillment of certain conditionality Incentive Performance grant shall be released. Incentive Performance Grant is available for the period from 2011-12 to 2014-15. The State is eligible to draw its allocations, if it complies with the following conditions: – Must put in place a Supplement Budget to the Local Bodies. – Must have an audit system as stipulated by CAG and maintenance of accounts of PRIs. – Should appoint independent Local Body Ombudsman who will look into complaints of corruption and maladministration against the functionaries of Local Bodies, both elected members and officials and recommend suitable action. – Should make necessary arrangement for electronically transferring Local Body Grants (e-Transfer) within five days of receipt from Central Government. – The State Government should adequately empower Local Body for levying property tax and other taxes to raise the income of PRIs.
  • 5. Grants Recommended by 13th FC ( in Crore) 2011- Components 2010-11 2012-13 2013-14 2014-15 Total 121 General Basic 241.29 279.78 326.99 387.43 458.71 1694.20 Grant2 General 0.00 95.66 224.41 264.70 312.23 897.00 Performance3 Special Area Grant 19.39 19.39 Total 260.68 375.44 551.40 652.13 770.94 2610.59The Commission have specifically recommended to use above grantson the following components.  Drinking water supply,  Sewerage, Solid waste management (rural sanitation),  Operational expenses (Maintenance of Accounts, Conducting of Audits, Creation of the Database) etc.
  • 6. Criteria for distribution of GrantsThe grants have been distributed to the Panchayats based on their In Lakhpopulation. Upto 5000 5001-7500 7501-10000 >10000 (3492 GPs) (2045 GPs) (572 GPs) (125 GPs) Perform Perform Perform PerforYear Category Basic ance Total Basic ance Total Basic ance Total Basic mance Total DW 1.75 0.00 1.75 1.92 0.00 1.92 2.08 0.00 2.08 2.15 0.00 2.15Year 1(10-11) Sanitation 1.63 0.00 1.63 1.77 0.00 1.77 1.91 0.00 1.91 1.98 0.00 1.984 Sub Total 3.38 0.00 3.38 3.69 0.00 3.69 3.99 0.00 3.99 4.13 0.00 4.134 DW 2.06 0.76 2.82 2.26 0.83 3.09 2.44 0.90 3.34 2.53 0.93 3.46Year 2(11-12) Sanitation 1.92 0.70 2.62 2.08 0.76 2.84 2.24 0.82 3.06 2.33 0.86 3.191 Sub Total 3.98 1.46 5.44 4.34 1.59 5.93 4.68 1.72 6.40 4.86 1.79 6.651 DW 2.43 1.78 4.21 2.67 1.95 4.62 2.88 2.10 4.98 2.99 2.18 5.17Year 3(12-13) Sanitation 2.26 1.65 3.91 2.45 1.79 4.24 2.65 1.93 4.58 2.75 2.01 4.764 Sub Total 4.69 3.43 8.12 5.12 3.74 8.86 5.53 4.03 9.56 5.74 4.19 9.934
  • 7. Criteria for distribution of GrantsThe grants have been distributed to the Panchayats based on their In Lakhpopulation. Upto 5000 5001-7500 7501-10000 >10000 (3492 GPs) (2045 GPs) (572 GPs) (125 GPs) Perform Perform Perform PerforYear Category Basic ance Total Basic ance Total Basic ance Total Basic mance Total DW 2.91 2.09 5.00 3.19 2.30 5.49 3.45 2.48 5.93 3.58 2.57 6.15Year 4 Sanitation 2.71 1.95 4.66 2.94 2.11 5.05 3.17 2.28 5.45 3.29 2.37 5.664(13-14) Sub Total 5.62 4.04 9.66 6.13 4.41 10.54 6.62 4.76 11.38 6.87 4.94 11.81 DW 3.48 2.47 5.95 3.81 2.71 6.52 4.12 2.93 7.05 4.27 3.03 7.3Year 5 Sanitation 3.23 2.30 5.53 3.51 2.49 6.00 3.78 2.69 6.47 3.93 2.80 6.733(14-15) Sub Total 6.71 4.77 11.48 7.32 5.20 12.52 7.90 5.62 13.52 8.20 5.83 14.03 DW 12.63 7.10 19.73 13.85 7.79 21.64 14.97 8.41 23.38 15.52 8.71 24.23G.Total Sanitation 11.75 6.60 18.35 12.75 7.15 19.90 13.74 7.72 21.46 14.30 8.04 22.34 G. Total 24.38 13.70 38.08 26.60 14.94 41.54 28.71 16.13 44.84 29.82 16.75 46.57
  • 8. Criteria for distribution of Grants (As per Population of G.P) (RS. IN LAKH) G. P. 
  • 9. Year 
  • 10. Drinking water supplyScarcity of drinking water in rural areas is seen to be a major problem, morespecifically, in tribal areas, this is very acute.The Operation and Maintenance of Drinking Water Supply system includingHand Pumps and Village Piped Water Projects is being directly managed by theGram Panchayats.The Operation and Maintenance cost of these projects shall be met out ofthese funds being provided to GPs.GPs shall take over the Operation and Maintenance of these projects after duephysical verification and inventory by the RWSS and Rural DevelopmentDepartment,if not done already.While taking up such physical assets, the current operation and maintenancecost like energy charges can only be met out of the funds released under thesegrants. Arrears, if any, shall not be paid out of the current provision of the 13thFinance Commission Award.
  • 11. Utilization funds for Drinking Water Supply The following expenditures are to be met out of 13th Finance Commission Award. – Procurement of spare parts for repair/rejuvenation of Water Supply System (Hand pump, Tube wells & Pipe Water Supply). – Payment of salary / wages of the RWSS employees deployed at Panchayat Samities / Gram Panchayats including self employed mechanics. – Payment of electric charges for PWS schemes (not arrear dues). – Expenditures towards deployment of mobile vans for repairs of PWS – Any other relevant purpose as per instructions issued by PR Department. A Gram Panchayat level purchase Committee in the Chairmanship of the concerned B.D.O and other members i.e. Asst. Engineer, RWS & S and Junior Engineer, RWS&S for procurement of materials from authorized manufacturing firms/Suppliers as approved by the Chief Engineer, RWS&S for repair / rejuvenation. The requirement of spare parts for maintenance of hand pumps, tube wells, Pipe water Supply will be assessed by the Junior Engineer, RWS&S.
  • 12. New water supply projectsa) Prepare micro plan of the GP for operation and maintenance. o Technical assistance by RD Department / RWSS. o Block wise list to be sent to PR Department by the DRDAs. o A separate property / assets register shall be maintained at the GP Level all such spot sources.a) In the normal maintenance, self employed mechanics shall be engaged by the Gram Panchayats and their remuneration would be met out of these funds. Detailed accounts in this regard shall be maintained by the Gram Panchayat indicating the stock and utilization.b) The Operation and Maintenance of defunct hand pump.c) Upgradation to pipe water supply scheme where good and quality discharge of water sources by dovetailing funds from other scheme for wider coverage.
  • 13. Sewerage / Solid Waste Management (Rural Sanitation)/Construction of C.C Road  Construction of Cement Concrete Roads with Drain inside villages / habitations of the GPs in their areas giving priority to different habitations / villages in the following manners. – First Priority : Primitive Tribal Group (PTG) villages /habitations ; – Next Priority : ST/SC habitations/villages; – Most populous village : If a block has already covered the above two categories.  While selecting the most populous village, the C.C. Road should be planned for execution from ST/SC basti towards the main habitation and not the vice-versa;  If the most populous village of the G.P. has already been covered up to the length of 500 meters, C.C. Road in the next most populous village shall be taken up.  The five years action plan based on the above principles should be prepared and duly approved by Gram Sabha / Palli Sabha for taking of the work.
  • 14. Operational ExpensesAll the GPs have already been supplied with Desktop, Laptop, Printer, MSOffice package etc out of 12th Finance Commission Grants,The 13th Finance Commission have emphasized on maintenance ofaccounts, conducting audit in each GP, entering into prescribed accountingsoftware to meet these expenses @ 2000/- per month per GP to beprovided for the above purposes. Out of this, 500/- per month for eachG.P. for operation and maintenance of computers and other consumableperipherals shall be released directly to Gram Panchayats.The monthly remuneration of Computer Programmers @ 9300/- is tobe met out of 13th Finance Commission Award, as was being done earlier.A 20 seated digital database management system with LAN has beensetup in all the 314 blocks out of 12th Finance Commission Grant. A sum of20,000/- per year per block is being provided for maintenance of the aboveinfrastructure out of the present grant.
  • 15. DISTRICT-WISE DISTRIBUTION OF 13TH FINANCE COMMISSION AWARD FOR DRINKINGWATER, SEWERAGE AND SOLID WASTE MANAGEMENT (SANITATION) FOR THE YEAR 2010-11 (SPECIAL AREA GRANT TO SCHEDULED AREA DISTRICTS) In LakhSl No District No. of Gram Panchayats Total including Outgrowth/Census Town etc. 1 BALASORE 25 25.00 2 GAJAPATI 96 93.00 3 GANJAM 23 23.00 4KALAHANDI 37 36.00 5 KORAPUT 227 225.00 6 MALKANGIRI 108 107.00 7 NABARANGPUR 170 176.00 8 PHULBANI 153 149.00 9 RAYAGADA 174 172.00 10 KEONJHAR 222 221.00 11 MAYURBHANJ 383 390.00 12 SAMBALPUR 55 54.00 13 SUNDARGARH 268 269.00 ORISSA 1941 1939.00
  • 16. Utilisation of Special Area Grant  Apart from General Basic Grant and General Performance Grant, the 13th Finance Commission have considered additional allocation of funds for development of scheduled areas.  There are as many as 1925 Gram Panchayats and 16 nos of Out Growth/ Census Town/ Industrial and Educational Township etc. covered under the Scheduled Areas in Orissa.  The additional allocation will supplement the fund already available with them out of Basic and Performance Grants for providing the basic services like Supply of Drinking Water, Sewerage and Solid Waste Management (Rural Sanitation) etc.  The guidelines for utilization of funds as outlined for General Basic Grant and General Performance Grant shall duly be adhered to for utilization of funds under Special Area Grant also.
  • 17. Submission of U.Cs The concerned PS/ GPs are responsible for timely utilization of the funds so released and submission of Utilization Certificates. The Collectors and Project Director of DRDAs should review the position in regard to utilization of funds and submit quarterly review report regularly to this Department by 2nd week of each quarter. The Panchayat Samiti/ Gram Panchayat shall maintain separate account for receipt and utilization of funds out of 13th Finance Commission Award. The monthly expenditure statement along with progress of works taken up shall be furnished by the Districts to this Department by 5 th of the every month regularly. The Project Director of DRDAs / District Panchayat Officers shall collect the Utilisation Certificates from the Block Development Officers and submit the same to this Department in time. Funds released should be utilized at the earliest following due procedure. Under no circumstances, funds released shall be utilized for any purpose other than those specified in the instructions issued above.
  • 18. Panchayati Raj Department http://orissapanchayat.gov.in