Shillong, July 20: The state government may have to pay an interest of crores of rupees to the three autonomous district councils (ADCs) for failing to release funds on time.
The government was supposed to release the funds, earmarked by the 15th Finance Commission under tied grants, within ten days following receipt.
According to the guidelines of Ministry of Finance, the government will have to pay the interest at market-borrowing rate. The funds of Rs 45.5 crore, released by the Centre under tied grants in July 2020, are yet to be released to the ADCs by the state government.
The committee of senior government officials in its meeting held on October 15, 2020 had decided that the tied grants, meant for specific uses such as sanitation and water supply, will be given to the Public Health Engineering (PHE) department which is executing such work under the Centre’s Jal Jeevan Mission.
Sources said the 15th Finance Commission had sanctioned the grants for areas like panchayats, ADCs and other rural local bodies (RLBs) which ordinarily do not receive help from the state government.
The Centre normally releases the grants, earmarked for the ADCs, to the Planning and Finance department which then releases the money to the District Council Affairs (DCA) department.
The Finance department had released the funds of untied grants to the PHE department in March this year.
Opposing this decision, Khasi Hills Autonomous District Council Chief Executive Member, Titosstarwell Chyne had earlier accused the state government of forcibly trying to divert funds under tied grants. He had asserted that the council would put pressure on the government to release the funds earmarked by the 15th Finance Commission.
“We will not surrender since the ADCs are the RLBs according to the guidelines for the implementation of funds released by the finance commission. Therefore, the decision to release the funds to the PHE department is illegal,” Chyne had then stated.
PN Syiem, who is a former CEM of KHADC and chairman of United Democratic Front, said the previous Congress-led government had to pay an interest of Rs 60 lakh to the council for not releasing funds earmarked by the 13th Finance Commission on time.
Meanwhile, sources said Chief Minister, Conrad K Sangma has decided to return the funds under tied grants to the ADCs as the matter has snowballed into a “political issue”.
According to the sources, the DCA department received a letter from the Finance department on June 28 last to issue a letter of award (LOA) to the three ADCs of the tied grants. The LOA is expected to be issued in the next few days, the sources said.
At the same time, the state government will also need to submit the Grant Transfer Certificate to the Centre to show that the funds have been released to the ADCs.
Out of the Rs 45.5 crore, KHADC is expected to receive Rs 21 crore, Garo Hills Autonomous District Council Rs 17 crore and Jaintia Hills Autonomous District Council Rs 7 crore.
Interestingly, the sources said, during the visit of the members of the Finance Commission to the state, the state government had suggested the funds, earmarked for the ADCs, be given to the Village Employment Council (VEC), which is implementing schemes under MGNREGA.
The sources also said that former Community and Rural Development (C&RD) Minister, Sniawbhalang Dhar had written a letter to the Centre seeking the release of the funds to the VEC.
However, the Centre, in its reply, had turned down the request stating that the VEC was specifically constituted to monitor the works and schemes implemented under MGNREGA, the sources said.
They said the Centre had further stated that it was ready to release the funds to the VEC if the state legislature recognizes the VEC as RLBs to implement grants earmarked by the Finance Commission.
The sources said the C&RD department decided not to pursue the matter further following the receipt of the Centre’s reply.
