BENGALURU: The state seems to have learnt its lesson from what happened to the grants that were supposed to come its way under the 15th finance commission.
This time, the Centre has incorporated one of the prime suggestions made by the Karnataka State Finance Commission in the 16th Finance Commission report for 2026-31.
“We had suggested that the utilisation certificate of schemes be stressed upon for allocating funds. We had recommended that the entire state should not be punished for the inability of some districts and departments to implement schemes. Instead, funds should be divided and allocated to districts and departments that are implementing the schemes,” said Dr C Narayanaswamy, Chairman, 5th Karnataka State Finance Commission.
“It was suggested that the prolonged wait for funds should be addressed, and a method should be derived for quick execution of work. It was suggested that each district submit a detailed account of the work orders and financial details on the utilisation of funds on quarterly basis for future allocations. The allocations of only those be withheld who are unable to upload the financial details and not punish the entire state,” he said.
Experts at the finance commission said, “This will not only help in getting funds from the Centre on time, but also makes districts and departments accountable. It will be handy in maintaining audit reports, ensuring transparency and submitting bills to state finance commission, for better allocation.”
Another official from the 5th State Finance Commission said, “The 15th Finance Commission taught us many lessons. The present one is better than the previous one, but weaker than the 14th. We had suggested that the clause that makes holding elections mandatory for allocation of funds be excluded. But that has not been incorporated."
"The state lost around Rs 3,000 crore in grants from the 15th Finance Commission to panchayats and Bengaluru city for not conducting elections before March 31, 2026. This time, the Centre has also stressed upon submission of property tax collection and gross domestic product details of panchayats and urban local bodies for allocation of funds,” he added.
The official said a similar condition is being included while drafting a report on allocation of funds for the five Bengaluru corporations. The report will be submitted by February-end for governor’s approval.
“Unlike earlier, the devolution of funds will be based on wards and developmental schemes that need to be undertaken,” the official said.