In order to monitor the funds disbursed to States and Union Territories (UTs) under the14th Finance Mission (FFC), the Ministry of Urban Development has sought utilisation reports for 2015-16 by June end, an official statement said on Sunday.
The Centre has asked the States to prevent diversion and misuse of FFC grants meant for urban local bodies (ULBs) and ensure their use only for improving the delivery of basic urban services like sanitation, water supply, solid and liquid waste management, storm water drains, maintenance of community assets, roads and footpaths, street lighting and burial and cremation grounds.
Rajiv Gauba, Secretary (Urban Development), has urged the States/UTs to prepare the annual plans for city-level utilisation of FFC grants linked to improving basic urban infrastructure till 2019-20, the statement added.
In order to avoid delay in transfer of grants, the Ministry said that States/UTs must transfer the funds to ULBs within 15 days of receiving them from the Centre. Moreover, in case of delay, bank rate of interest shall be paid and the same shall be reflected in the utilisation reports to be sent to the Ministry.
The 14th Finance Commission awarded a total grant of ₹87,144 crore to ULBsas Basic Grant (80%) and Performance Grant (20%). While Basic Grant is given to all States/UTs, release of Performance Grant is linked to ULBs ensuring audit of accounts for the previous two years, increase in revenues over the previous year and notification of Service Level Improvement Plans in respect of basic services.