In a significant move aimed at strengthening Urban Local Bodies (ULBs) and enhancing urban service delivery, the Central government has issued comprehensive guidelines on the utilisation of municipal funds.
The order, issued by S. Suresh Kumar, Principal Secretary, Municipal Administration and Urban Development Department through G.O. Ms. No. 75, on Monday seeks to ensure efficient financial management across all ULBs, starting April 1, 2025.
Aligning with the State’s ambitious Swarna Andhra@2047 vision and India’s Viksit Bharat@2047 mission, the government aims to accelerate GSDP growth by over 15% annually.
Recognising ULBs as critical growth hubs, the new policy grants them greater autonomy over municipal fund management, as announced by the Finance Minister Payyavula Keshav during the 2025-26 Budget Session.
The guidelines categorise expenditures into maintenance and capital investment, targeting critical sectors such as public health, sanitation, water supply, roads, drainage, and streetlighting.
Essential services
ULBs are mandated to prioritise essential services like 100% door-to-door waste collection, leak-proof water supply, pothole-free roads, and fully functional streetlights.
Municipalities have been directed to allocate a minimum portion of their revenues— ranging from 20% to 30% depending on their grade—to capital expenditure projects.
Furthermore, not less than 30% of income, excluding government grants, must be earmarked for public health advancements under the Public Health Act, 1939.
Monitoring mechanism
To ensure accountability, a robust monitoring mechanism, including a dedicated expenditure dashboard linked to the ERP system, will be set up. Expenditure reviews will be conducted fortnightly by the Municipal Administration Directorate and monthly by the State government.
Mr. Suresh Kumar emphasised strict adherence to these guidelines to transform urban governance and deliver better services to citizens.
Published – April 29, 2025 05:10 am IST
