Utilisation of Fifteenth Finance Commission’s Health Grants: A Kerala Story





This paper evaluates the strengths, weaknesses, opportunities, and challenges involved in the management and utilisation of health grants in Kerala, a state renowned for its decentralised healthcare system, with the support of empirical evidence from all the urban and rural local governments in the state. It critically explores the factors that led to poor utilisation of health grants through the lens of politicisation, personalisation, corruption, post-office syndrome, capability traps, poor self-esteem, over emphasis on legalistic framework and rule-bound approaches, and relative absence of thick and thin accountability. While the 15th Union Finance Commission took inspiration from the Kerala model of decentralised healthcare to involve the rural and urban local governments in the health sector and extend additional resources to strengthen the primary health system at the grassroots level with the introduction of health grants, the shocking underutilisation of health grants in the model state is a disappointing one.


Health Grants, Kerala, Fifteenth Finance Commission, Decentralisation, Politicisation, Post-Office Syndrome, Capability Traps


Download data is not yet available.

Authors Bio

Jos Chathukulam, Centre for Rural Management

* Jos Chathukulam is the Director, Centre for Rural Management (CRM), Kottayam, Kerala.

Manasi Joseph, Centre for Rural Management

Manasi Joseph is a researcher with the Centre for Rural Management (CRM), Kottayam, Kerala.

T V Thilakan, Centre for Rural Management

T V Thilakanis a researcher with the Centre for Rural Management (CRM), Kottayam, Kerala.

V Rekha, Centre for Rural Management

V Rekha is a researcher with the Centre for Rural Management (CRM), Kottayam, Kerala.

C V Balamurali, Centre for Rural Management

C V Balamurali is a researcher with the Centre for Rural Management (CRM), Kottayam, Kerala.


Aiyar, Yamini and Bhattacharya, Shranaya. 2016. “The Post Office Paradox: A Case Study of the Block Level Education Bureaucracy.” Economic and Political Weekly, LI (11): 61-69.

Andrews, Matt., Pritchett, Lant., and Woolcock Michael. 2017. “Premature load bearing: Doing Too Much Too Soon”, Building State Capability: Evidence, Analysis, Action.” Oxford Academic https://doi.org/10.1093/acprof:oso/9780198747482.003.0004, accessed 23 Dec. 2023.

Antony, Toby. (2023, February 6). LSGD most corrupt among Kerala departments, The New Indian Express.

Chathukulam, Jos., and Joseph, Manasi. 2022. “Will Health Grants to Local Governments by the Fifteenth Finance Commission Eventually Become a Victim of Mission Creep Syndrome?” Indian Public Policy Review, 3(3):59-79. https://doi/org/10.55763/ippr.2022.03.03.004

Chathukulam, Jos., Buch, Krishnakanth and Joseph, Manasi. 2023. “Does the National Health Index Truly Measure the Health Status?” Mainstream Weekly, 6(17).

Chathukulam, Jos., and John, M.S. 2002. “Five Years of Participatory Planning in Kerala: Rhetoric and Reality”. Economic and Political Weekly, 37(49):4917-26.

Chathukulam, Jos., and John, M.S. 2003. “Measuring Decentralisation: The Case of Kerala (India)”. Public Administration & Development, 23 (4):347-60.

Chathukulam, Jos., and Tharamangalam, Joseph. 2021. “The Kerala Model in the Time of Covid 19: Rethinking State, Society and Democracy”. World Development, 137:105207.

Ekbal, B. 2022. Mahamarikal: Plague Muthal Covid Vare: Charithram, Sasthram, Athijeevananam (Malayalam), (Pandemics: From Plague to Covid 19: History, Science and Survival), Kerala: Shastra Sahitya Parishad.

Fang, F. 2020. Wuhan diary: Dispatches from a Quarantined city. Trans. M. Berry. New York: HarperCollins.

Fifteenth Finance Commission Report for 2021-26, Finance Commission in Covid 19 Times, Finance Commission of India.

Gangadharan, K., and C. Sufira. 2019. “Does Public Health Care System Need more focus on Urban Health? Evidence from Kerala”. Think India Journal, 22 (35).

Jacob, B., and Jacob, S. 2021. Governing Locally: Institutions, Policies, and Implementation in Indian cities. Cambridge, MA: Cambridge University Press.

Jafar. K. 2014. A Note on Peoples’ Planning Initiative -Possible Lessons from the Kerala Experience. Munich Personal RePEc Paper No: 65610

Isaac, Thomas and E.M. Sreedharan.1992. 'Kerala 's Development and Its

Politics', Marxist Samvadam, October-December (Malayalam).

Majumdar, Amlan. 2023. “Economic Efficiency of the Primary Healthcare System in India: A Study Based on Facility Survey.” Economic and Political Weekly, 44 (40).

Mangla, A. 2014. “Bureaucratic Norms and State Capacity: Implementing Primary Education in India’s Himalayan Region,” Working Paper 14. Retrieved from Harvard Business School.

Mehta, P B and Walton, M. 2012. “India’s Political Settlement and Development Path, Effective Sates and Inclusive Development, Working Paper No 36.

Moolakkattu, John and Chathukulam, Jos. 2003. Decentralised Planning and Growth in the Productive Sectors: Case Study of a Village Panchayat in Kerala. Review of Development and Change. 8. 1-24. 10.1177/0972266120030101.

Narayana, D. 2022. Size of Local Governments in a Rapidly Urbanising Kerala: Is it Sustainable? Paper presented at the International Webinar on Grassroots Participation and Local Development: Learnings from the 'People's Plan Campaign' in Kerala (India) and 'Batho Pele Initiative' in South Africa on May 26, 2022, organized by Centre for Rural Management (CRM), Kottayam, Kerala (India), Department of Public Management and International Relations, School of Public Service and Governance, The Ghana Institute of Management and Public Administration (GIMPA), Ghana and The National School of Government (the NSG), South Africa.

NITI Aayog. 2018, 2019, 2020 and 2021. Health Index, Healthy States, Progressive India, New Delhi.

NITI Aayog. (2022 and 2023). National Multidimensional Poverty Index.

Pritchett, Lant. 2009. “Is India a Flailing State? Detours on the Four Lane Highway to Modernisation,” HKS Faculty Research Working Paper Series RWP09-013, John F. Kennedy School of Government, Harvard University.

Pritchett Lant., Woolcock, Michael., and Andrews, Matthew. 2010. “Capability Traps? The Mechanisms of Persistent Implementation Failure.” Center for Global Development Working Paper No. 234, Available at SSRN: https://ssrn.com/abstract=1824519 or http://dx.doi.org/10.2139/ssrn.1824519

Puthiyetti, Prakashan. (2023, December 13). Centre blocks fund worth Rs 600 cr to Kerala, cites incomplete financial data, Mathrubhumi.

Ramankutty, V., and Vijayakumar K. 2023. Decentralisation and Local Decision Making in Health: The Kerala Experience, Health Action by People (HAP), Thiruvanthapuram, Kerala, India.

Rao, Govinda, M. 2023. “Sixteenth Finance Commission faces an uphill challenge”, Hindustan Times, August 16, 2023. https://www.hindustantimes.com/opinion/16th-finance-commission-faces-an-uphill-challenge-101692193446713.html

Raghunandan, R. T. 2019. Everything You Ever Wanted to Know About Bureaucracy but Were Too Afraid to Ask. Penguin Random House: India.

Rao, Vijyendra. 2005. Symbolic Public Goods and the Coordination of Collective Action: A Comparison of Local Development in India and Indonesia, World Bank Policy Research Working Paper 3685.

The Economic Times. (2017, January 29). India spends less than BRICS, SAARC Nations on Health, The Economic Times.

The Hindu Bureau. (2023, November 13). Nirmala counters Kerala Government’s charges on denial of funds due to the State, The Hindu.

Wallen, Joe. (2020, September 16). India's healthcare system on brink of collapse again as it hits five million Covid-19 cases, The Telegraph.