Raipur: The Sixteenth Finance Commission (FC-16) has recommended ₹11,664 crore in grants for Chhattisgarh’s duly constituted Panchayati Raj Institutions and Rural Local Bodies (RLBs) for the 2026-31 award period, according to information provided in the Rajya Sabha.
The Finance Commission has recommended a total of ₹4,35,236 crore for Rural Local Bodies across all 28 States during the five-year period.
How the RLB Grants Will Be Structured
The FC-16 grants will have two components — Basic Grant and Performance Grant — in an 80:20 ratio.
Of the Basic Grant:
- 50% will be a Tied Grant for sanitation and solid waste management and/or water management.
- The remaining 50% of the Basic Grant will be Untied.
- The entire Performance Grant will also be Untied.
- Untied grants can be used by Rural Local Bodies for location-specific needs under the 29 subjects listed in the Eleventh Schedule of the Constitution.
The Ministry of Finance, Department of Expenditure, issued operational guidelines for implementing the FC-16 RLB grants on May 21, 2026.
Steps to Strengthen Panchayat Revenue
The Centre has also taken several measures to help Panchayats increase their Own Source Revenue (OSR) and strengthen their financial self-reliance.
Among the measures are:
- OSR training: In collaboration with IIM Ahmedabad, the Ministry of Panchayati Raj developed a specialised training module on Own Source Revenue. As of July 10, 2026, 2,75,893 participants had been trained under the module through the Rashtriya Gram Swaraj Abhiyan.
- Atma Nirbhar Panchayat Special Award: Launched in 2025 to encourage Panchayats to increase their own-source revenue.
- SAMARTH Panchayat portal: Developed to facilitate tax and non-tax demand generation, collection, maintenance of tax registers and online revenue tracking.
- Model OSR Rules: The Ministry has formulated advisory Model Own Source Revenue Rules for States and Union Territories to strengthen the legal and institutional framework for Panchayat revenue.
- SVAMITVA: The rural property mapping scheme is intended to support the growth of property taxation in rural areas and, in turn, help increase Panchayats’ own-source revenue.
Digital Monitoring of Panchayat Funds
The government has also strengthened digital monitoring of Finance Commission grants through eGramSwaraj, which has been operational since April 2020.
The portal integrates Panchayat financial functions, from planning to payments, while progress data is made available in the public domain for monitoring at the State, District and Block levels.
eGramSwaraj is integrated with the Public Financial Management System (PFMS) to facilitate digital payments to vendors and service providers.
Online Auditing for Greater Financial Oversight
The AuditOnline application, also launched in April 2020, enables online auditing of Panchayat accounts and financial management.
Together, these digital systems are aimed at improving transparency, accountability and financial oversight in the utilisation of Central Finance Commission grants by Panchayati Raj Institutions, including those in Chhattisgarh.
