Finance corps mooted for rural local bodies

The Third State Finance Commission has recommended setting up a Rural Infrastructure Development and Finance Corporation. The corporation will fund the requirements of the rural local bodies in Karnataka. 

Speaking to reporters after submitting the commission report to the Karnataka government on Tuesday, A G Kodgi, chairman, The Third State Finance Commission, said, “We observed that people living in the rural areas are put to hardship on account of the lack of infrastructure. Hence, a separate Rural Infrastructure Development and Finance Corporation should be created to mobilise capital to fund rural development projects.”

“The funds raised through this corporation can be directly utilised in the rural areas by taking up rural roads and drinking water projects, and for installing streetlights,” he added. 

The commission has done a detailed study on the role to be played by the urban local bodies like nagara palikes and requirements of rural local bodies like gram panchayats, taluk panchayats and zilla panchayats. 

Currently, the nagara palikes in the state face issues in parking, footpath requirements and slum clearance. 

“The commission recommends that special grants be made available to the Bangalore City Corporation for creating underground / multi-level parking, wherein 500 to 1,000 vehicles can be parked at a time. 

There is also an urgent need to clear footpaths and shift footpath vendors to dedicated places and impose stringent measures on violators,” Kodgi said. 

At the gram panchayat level, action should be taken to integrate the works of different departments related to agriculture, horticulture, dairy and other activities. A single window system is necessary. 

“It is also necessary that a minimum of 5 per cent of the funds is earmarked to encourage rural sports, youth development and folk arts,” said Kodgi. 

Utilisation of Central Finance Comm-ission funds should rest with the taluk panc-hayats. “At this level, services of executive officer should be brought under the Cadre and Recruitment Rules and the position should not be below the rank of assistant commissioner. The officer should be responsible for implementation of works and should have direct control on all the taluk level officers,” Kudgi said. 

The zilla panchayats should have independent powers to utilise funds released under Central Finance Commission grants. "Due to huge fund flows at this level, zilla panchyats need to prioritise and implement work related to programmes of the central and state governments," said T Thimme Gowda, member of the Third State Finance Commission.