CHANDIGARH | 21 February 2026 By Manjeet Sehgal
The specter of ‘corruption’ and ‘misutilization of funds’ has returned to haunt Punjab politics, raising serious questions about the accountability of the Bhagwant Mann-led government. Senior Congress leader and MLA Sukhpal Singh Khaira has once again taken the offensive, knocking directly on the doors of the Central Government. In a detailed letter addressed to the Union Minister for Rural Development and Panchayati Raj, Shivraj Singh Chouhan, Khaira has alleged a massive financial embezzlement of approximately ₹750 crore from the 15th Finance Commission funds. This case appears to be more than just a financial irregularity; it looks like a direct assault on the roots of rural development.
Khaira claims that the substantial funds released by the Centre for the empowerment of Punjab’s Rural Local Bodies (RLBs)—including Gram Panchayats, Panchayat Samitis, and Zila Parishads—have been illegally ‘diverted’ by the state government. Under constitutional provisions, this money was supposed to be credited directly to the accounts of the Panchayats to develop grassroots infrastructure such as paved roads, drainage systems, and other civic amenities. However, based on inputs from field sources, Khaira has leveled shocking allegations that nearly ₹750 crore of this amount was used by the Punjab government to clear its own departmental liabilities, specifically operational expenses related to water supply and allied services.
This situation is not only a blatant violation of the strict guidelines set by the 15th Finance Commission but also a “murder” of the core spirit of the 73rd Constitutional Amendment, which advocates for the fiscal autonomy of Panchayats. In his letter, Khaira made it clear that such a diversion of funds is a dark stain on the state’s claims of transparent governance. He has urged the Union Minister to order a comprehensive high-level audit and inquiry into the matter. Khaira has demanded that the Centre seek a detailed report from the Punjab government, including a panchayat-wise breakdown of fund transfers, to expose whether expenditures were misreported or improperly shifted to departmental accounts.
According to Manjeet Sehgal’s analysis, this controversy is likely to trigger a new ‘financial war’ in Punjab politics. If Khaira’s allegations are proven true, the Mann government will not only find it difficult to provide answers but could also face a crisis regarding future central grants. Khaira has signaled that the battle for the rights of the Panchayats has reached Delhi’s doorstep, and he will not rest until accountability is fixed. For now, all eyes are on Union Minister Shivraj Singh Chouhan’s next move and whether he orders a deep-dive investigation into these rural funds.
