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Indian Polity

Ministry of Panchayati Raj

Impact assessment of development in Gram Panchayats

Posted On: 06 AUG 2018 5:24PM by PIB Delhi

According to the inputs received from Ministry of Panchayati Raj, under the Fourteenth Finance Commission (FFC), grants to the tune of ₹ 2,00,292.20 crore for the period from 2015 to 2020 are being devolved to Gram Panchayats constituted under Part IX of the Constitution, amounting to an assistance of ₹. 488 per capita per annum at an aggregate level for 26 States for delivering basic services such as water supply, sanitation, sewerage, solid waste management, storm water drainage, etc.



The Ministry of Panchayati Raj constituted Common Review Mission (CRM) in the year 2017 to assess the effectiveness of utilization of Fourteenth Finance Commission (FFC) grants by selected Gram Panchayats (GPs) in eight States viz. Assam, Gujarat, Jharkhand, Karnataka, Madhya Pradesh, Odisha, Telangana and Uttar Pradesh during 2017. The main focus areas of CRM were availability of fiscal resources in the Panchayats; transfer of FFC grants; devolution of functions; convergence of schemes; timely transfer of funds to GPs; effective utilization of the funds in basic services; preparation of plans and public perception; maintenance of records including accounts; transparency and accountability.

State-wise important observations/recommendations:



Important observations/recommendations




Own Source Revenue (OSR) generation from shops, hawkers, leasing of


community assets like ponds and community hall. Convergence of FFC


fundswith other scheme is required for progress.




FFC works useful for community. Capacity Building/Awareness and


Training required for the progress.




Basic services addressed by the FFC grants. Innovations adopted for water






Focus on basic services like water supply, drainage system and roads. GPs


having commercial/industrial activities able to generate larger OSR.


Compliance to tax payment is in correlation with economic and literacy





Madhya Pradesh

Gram Panchayat Development Plan (GPDP) prepared and approved by


Gram Sabhas in most GPs. Capacity Building of representatives and staff


are required.




GPs in the process of transformation into institutions of local self-


governance. Elected representatives have freedom to utilize such funds for


delivery of basic services to the local population.




OSR of GPs generated mainly from House Tax, Property Tax, Water Tax,


License fee, etc.There is need for scope for training of elected


representatives specially women representatives.



Uttar Pradesh

FFC funds utilized mainly on providing drainage, interlocking of roads,


hand pumps, solar light etc. Manpower, training& effective peoples


participation are aspects required for the progress.




The common observations across the GP in the eight States are as under:-



  1. Sizeable amounts of funds are now available with the GPs. Fund transfer mechanism to GPs across State have been streamlined.


  1. Funds were utilized by the Panchayats for improvement of facilities relating to providing basic services including drinking water, sanitation, sewage, solid waste management, etc.


  1. Gram Panchayat Development Plan (GPDP)are being prepared.



  1. Convergence of FFC funds with other programmes have taken place in some panchayats in some States.


VI.     Panchayat specific Software applications are adopted/utilized by various States with variations across different States depending on factors like computers, electricity supply, technical staff, and other infrastructural support.


VII.     Remarkable progress have been made in strengthening of GPs under the FFC award.


VIII.     The aspects of selection of work, convergence, revenue mobilization at GP level, availability of staff, social audit are some of the areas on which further progress is required.


IX.     GPs having industrial/commercial activities had better opportunity of generation of Own Source of Revenue (OSR). OSR also generated from other sources like property tax, house tax, shops, etc.


This information was provided by the Minister of State for Rural Development, Shri Ram Kripal Yadav today in a written reply to a question in Rajya  Sabha.





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