15th Finance commission report

The 15th Finance Commission Report for 2021-26 recognises urbanisation as an important engine of national economic growth and poverty reduction and emphasises the need for meeting the future challenges of spatial urban expansion into the metropolitan peripheries and in planned new cities. But it is also riddled with serious shortcomings that need to be highlighted.

Of Rs. 4,36,361 crore grants recommended for local governments , Rs.8,000 crore are performance based incubation grants for 8 new cities and Rs.450 crore are for the establishment of municipal shared services centres. In view of the current pandemic, FC has provided Rs .70,051 crore to LBs to strengthen their primary healthcare system. The remaining Rs.3,57,860 crore are to be distributed amongst states using 2011 population and area weightage points. The direct grant recommended for ULBs of Rs. 1,21,055 crore is 39% more than the corresponding Rs.87,144 crore provided by the 14th FC. It also works out to be a little higher at 1.17% of the divisible pool than 0.93% allocated by the 14th FC. Following a city size based differentiated approach, setting up a Metropolitan Challenge Fund with Rs.38,196 crore is recommended for category-I 50 million-plus cities . About 32% of MCF is tied for achieving ambient air quality and about 68% is earmarked for meeting service level benchmarks on drinking water supply, rainwater harvesting and water recycling, solid waste management and sanitation

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