More Assistance to Local Bodies Having Low Per Capita Income: CM Naidu
Naidu said a detailed study should be done for the development of panchayats, including on the utilisation of MGNREGA funds, for the strengthening of local bodies.
Vijayawada: Chief Minister Nara Chandrababu Naidu has called upon officials to focus on strengthening local bodies by enhancing their own revenue sources, in addition to the regular central and state government financial assistance.
The CM was present at the fifth state finance commission meeting in Amaravati on Wednesday. Commission chairperson Ratnakumari, members Prasada Rao, Krupa Rao and senior officials were present. The commission members handed over to Naidu a set of recommendations for strengthening the local bodies.
Naidu said, “Faster development is possible only when local self-governments achieve financial independence.” He called for categorisation of panchayats based on their income levels, and recommended targeted support to the weaker and backwards local bodies. “The local bodies identified with backwardness and low per capita income should be provided special assistance,” he stressed.
The CM said a detailed study should be done for the development of panchayats, including on the utilisation of MGNREGA funds, for the strengthening of local bodies. Increasing the revenue resources of local bodies is a must and these entities should be strengthened.
The Chief Minister directed the officials to complete the auditing of both panchayats and urban development authorities.
Deputy Chief Minister K. Pawan Kalyan asked the officials to come up with details of house tax revenue from 2019-24 and make the accounts available online. He also said the poultry industry should be strengthened.
The finance commission members said the state has been facing several financial challenges. “When we had a look at the 2023-24 financial year position, employees' salaries, pensions and the amount spent towards interests stood at 111 per cent,” they said
In addition, the government has to fund the development of the Amaravati capital and implement at the Super Six programmes, putting a major strain on the exchequer, they added.
The members noted that the resource gap of panchayat raj between 2025 to 2029 was at Rs.7,033 crore. At the same time, the resource gap of urban development authorities stood at Rs.2,016 crore, marking a wide gap between tax revenue demand and collection.
They said the power bill due to panchayats stood at Rs.5,851.58 crore till June 2024, though the funds sanctioned to panchayats in different forms stood at only Rs.2,617 crore. The panchayats spent Rs.393.77 crore towards salaries of panchayat raj staff while Rs.1,672.45 crore went towards salaries of municipal staff.
