Finance Standing Committee

The Finance Standing Committee is the most important standing committee responsible for controlling and overseeing financial matters in the local self-government institutions of Kerala (Gram Panchayat, Block Panchayat, and District Panchayat).

Unlike other committees, the Vice President of the local body serves as the official Chairperson of this committee. The Panchayat's treasury and financial discipline operate entirely under the supervision of this committee.

Key Responsibilities and Areas of Operation

1. Budget Preparation:

  • It is this committee that prepares the budget containing the income and expenditure estimates of the local body for the upcoming financial year.
  • The Vice President presents this budget at the governing body meeting and obtains approval.

2. Financial Expenditure and Project Scrutiny (Financial Scrutiny):

  • It is the Finance Committee that grants financial approval for all plans and projects prepared by the other standing committees (Development, Welfare, and Health & Education).
  • It is being examined whether funds have been properly allocated and whether the sanctioning of the amount is legal.

3. Increasing Own Source Revenue (OSR):

  • Find ways to increase the Panchayat's own funds, or internal revenue.
  • Ensure that property tax, profession tax, D&O license fees, advertisement tax, and trade license fees are collected promptly.
  • Plan special campaigns to collect tax arrears.

4. Approval of Expenditures:

  • Examine and pass the accounts of all monthly expenses incurred by the Panchayat.
  • Allocate funds for unforeseen emergency expenses with the prior approval of the governing body.

5. Audit Compliance:

  • Prepare precise responses to audit objections and queries raised during various audits, such as Local Fund audits and LGSD audits.
  • If financial losses have been incurred, take steps to recover them.