[52-A. Constitution of Basic Services Fund. ––(1) There shall be a separate fund called the ‘Basic Services to the Urban Poor Fund’ constituted by every Municipality for delivery of basic services to the urban poor including the inhabitants of slum areas.
(2) A minimum of twenty five percent of the funds out of development funds after reducing expenditure on establishment etc. within the budget of Municipality shall be earmarked and used for providing basic services to the urban poor, including inhabitants of slum areas on a yearly basis. The allocation to the fund shall be made from the following budgetary resources,––
(i) municipality’s own sources of revenue like taxes, fees, user charges and rent etc ;
(ii) assigned revenues ;
(iii) allocations from Central or State Finance Commission or other intergovernmental transfers ;
(iv) contributions in cash or kind, gifts from individuals, organizations, donors for services to the poor ;
(v) grants from externally aided projects ;
(vi) sale of municipal assets ;
(vii) other sources as determined by the municipality.
Explanation:–– For the purpose of this section any grant or contribution by whatever name called, received by the Municipality which is exclusively for the development of slum areas shall not be a part of the above earmarked fund.
(3) The earmarked funds under sub-section (1) shall be for providing basic services to the urban poor including the inhabitants of the slum areas.
Explanation:–– For the purposes of this section, ‘basic services’ shall include expenditure on capital and revenue account directly incurred on water supply, drainage, sewerage, construction of community toilets, solid waste management, connecting roads, street lighting, public parks and play grounds, community and livelihood centres, community health centres, pre-primary and primary education centres, affordable housing for poor, and other services as determined by the Municipality but shall not include establishment expenses, including salary and wages, not directly and specifically incurred for delivery of basic services to the poor.
(4) The allocation of the funds and its utilization for providing basic services to the urban poor should be detailed and enclosed with the Municipal Annual Budget as Budget for Poor along with the corresponding figures for the previous year.
(5) The fund shall be in the nature of a non-lapsable fund. In the event of the annual allocations not fully utilized, the balance funds should not be transferred to the municipal general fund but carried forward for utilization in the subsequent years. The fund allocation in the subsequent years shall be considered in addition, and shall not be reduced by the unspent funds of the previous years.
(6) A separate bank account shall be opened with a nationalized bank by the name of ‘Basic Services to Urban Poor Fund’ account wherein funds earmarked under sub-section (1) shall be periodically deposited ensuring that the yearly allocation is equal to the allocation as in the Municipal Budget.
(7) There shall be maintained separate Primary Books of Accounts with detailed accounting heads in line with the Jammu and Kashmir Municipal Accounts Manual for operation of special fund accounts].