Chandigarh, October 10:- The Haryana Cabinet, chaired by Chief Minister Nayab Singh Saini, today approved the continuation of the recommendations of the Sixth State Finance Commission for the allocation of grants to rural and urban local governments and bodies from the financial year 2026-27 until the recommendations of the next State Finance Commission are received. The Cabinet meeting was held here today.
The decision has been taken because the state government has not yet received the report of the Seventh State Finance Commission. Accordingly, in line with the arrangement followed earlier, funds and grants will continue to be distributed to local governments in accordance with the approved recommendations of the Sixth State Finance Commission until the recommendations of the next State Finance Commission are received.
Under the approved arrangement, 7 per cent of the state’s own tax revenue will be allocated to local bodies on an actual basis. The amount will be distributed among Gram Panchayats and urban local bodies, giving 80 per cent weightage to population and 20 per cent to geographical area. For this purpose, population data available on the Parivar Pehchan Patra portal as of December 31 each year will be used.
In the case of Zila Parishads and Panchayat Samitis, the amount will also be distributed on the basis of population data available on the Parivar Pehchan Patra portal as of December 31 each year. The funds will be distributed among Gram Panchayats, Panchayat Samitis and Zila Parishads in the ratio of 75:15:10, respectively. Under the approved arrangement, local bodies will be allowed to spend a maximum of 30 per cent of the allocated amount on paving streets.
The arrangement also stipulates that the actual revenue of urban local bodies must be at least 85 per cent of the budgeted revenue reflected in the audited accounts of the previous year. Failure to comply with this condition will result in a 20 per cent reduction in the share recommended for the concerned urban local body under the State Finance Commission grant for the current year.
