Panchayati raj ministry's allocation for FY26 could be 5-10% higher

The Union Budget for FY26 may allocate 5-10% more funds to the panchayati raj ministry with a higher outgo towards the Rashtriya Gram Swaraj Abhiyan (RGSA), according to ministry secretary Vivek Bhardwaj.

- Puja Das

In the run-up to the budget, the ministry is planning to take a few initiatives that will help empower local governments—gram panchayats, panchayat samitis and zila Parishads—increase own source revenue (OSR) through local taxes, fees, fines and other charges, Bhardwaj said in an interview.

RGSA supports local governments deliver on UN sustainable development goals (SDGs) through inclusive governance.

The 15th Finance Commission says local governments have the potential to raise ₹50,000 crore through house tax every year.

The push is aimed at nudging states and union territories, including Bihar, Jharkhand, Uttar Pradesh, Lakshadweep and northeastern states, to adopt an OSR model.