Hyderabad: Nearly Rs 1,200 crore in central grants earmarked for Telangana’s rural local bodies has been withheld due to delays in the submission of utilisation certificates (UCs) and related audit reports to the Union panchayat raj and finance ministries.The funds are part of the grants recommended by the 15th Finance Commission, under which Telangana was allocated Rs 7,201 crore between 2021-22 and 2025-26 for gram panchayats, mandal parishads and zilla parishads to undertake development works in villages.Under the funding guidelines, the state govt is required to submit UCs detailing expenditures incurred on approved works, along with audit reports of local bodies, before subsequent instalments can be released.Sources said delays in execution of works following local body elections contributed to the backlog. Several months were spent on the conduct of elections, and newly-elected bodies subsequently required time to convene gram sabhas, secure approvals and resume pending development works. This, in turn, delayed the submission of UCs to the Centre, sources said.As a result, Telangana did not receive about Rs 233 crore due for 2024-25 and another Rs 620 crore due for 2025-26 under the 15th Finance Commission grants.The delay has also impacted the release of funds under the 16th Finance Commission. Of the Rs 9,968 crore allocated to Telangana, the first instalment of over Rs 300 crore, which was due in June, has not yet been released as the Centre is awaiting UCs linked to the previous Finance Commission period, which ended on March 31, 2026.Officials said nearly Rs 800 crore of the pending grants could be released once the state submits the required bills, UCs and completes other formalities. However, the release of around Rs 400 crore meant for mandal and zilla parishads for 2024-25 and 2025-26 is unlikely. This is because elections to MPTCs and ZPTCs were not conducted before March 31, 2026, when the term of the 15th Finance Commission ended.“Panchayat raj and rural development minister Seethakka is pursuing with the Centre for release of pending grants once the UCs are submitted and other formalities are completed. The pace of works in gram panchayats have also been expedited. Recently, the minister wrote to the Union panchayat raj ministry and the finance ministry explaining the reasons for the delay in submission of relevant bills and certificates,” a senior official said.GFX:”15th finance commission allocations for 2021-22 to 2025-26 fiscals ro rural local bodies in Telangana:2021: Rs 1365 crore allocated and released.2022-23: 1415 crore allocated and released.2023-24: 1430 crore allocated and released.2024-25: 1514 crore allocated– Rs 1281 crore released, leaving a balance of Rs 233 crore.2025-26: Rs 1277 crore allocated but only Rs 620-odd crore released.==The 16th finance commission:2026-27 fiscal: Rs 1280 crore allocated but first tranche of Rs 300-odd crore to be released in June, yet to be released.
