15th Finance Commission Grant To Local Bodies

The Fifteenth Finance Commissionhas submitted its interim report for the period FY 2020-21 and the Government of India has accepted its recommendations in respect of the Local Bodies.
The Commission has worked out the total size of the grant to be Rs.60,750 crore for the period FY 2020-21 which is the highest ever allocation made by the Finance Commission in any single year.
The Commission has recommended Grants-in-aid to all tiers of the Panchayati Raj including the Traditional Bodies of Fifth and Sixth Schedule areas, in 28 States, in two parts, namely, (i) a Basic Grant and (ii) a Tied Grant.
50 % of the grant will be Basic Grant and 50 % will be the Tied Grant. The basic grants are untied and can be used by RLBs for location-specific felt needs, except for salary or other establishment expenditure.
The Tied Grants are to be used for the basic services of (a) sanitation and maintenance of open-defecation free (ODF) status and (b) supply of drinking water, rain water harvesting and water recycling. The RLBs shall, as far as possible, earmark one half of these Tied Grants each to these two critical services. However, if any RLB has fully saturated the needs of one category it can utilize the funds for the other category.