Local bodies governed by the opposition parties have sensed an opportunity in the Kerala government's silence towards emotional pleas and intense protests of Accredited Social Health Activists (ASHAs). The recent budget presentations across the local self-government institutions under the BJP and the UDF became a platform for strong political statements. A slew of declarations on aid and perks for ASHAs were declared in the budget. This has also led to questions as to whether the local bodies need the final clearance from the state government to fulfil the budget proposals.

 All the panchayats and civic bodies which have announced special packages for ASHAs have decided to shell out money from own fund. PP Balan, former Director General of KILA (Kerala Institute of Local Administration) said that provisions under the act empower local bodies to allot funds by passing a resolution.

"LSGIs can spend money from own fund for designated purpose. The government cannot restrict that expenditure and regulation is possible only for plan funds. Even the guidelines of the District Planning Committee (DPC) are applicable for plan funds. It cannot be insisted that a project is required to spend money from own fund to distribute honorarium. If the government chooses to intervene, it will be denial of the fiscal autonomy of the local bodies," said  P P Balan.

Starting from the Congress-led Vechoochira Panchayat in Pathanamthitta, several local bodies, including Elapully Panchayat in Pakakkad, the BJP-led Mutholy Panchayat, Palakkad Municipality, and the UDF-led Kannur Municipal Corporation, have followed suit.

KPCC President K Sudhakaran has also directed Congress-ruled local bodies to pay additional wages to ASHA workers. A circular issued by General Secretary M Liju states that this decision aims to support ASHA workers, with funds to be raised from the local bodies' own resources. The indefinite strike of ASHAs, which reached its 50th day on Monday, saw ASHAs shave their heads in a 'symbolic' gesture.

As per the act, a panchayat fund can be used for everything needed for safety, health, education, convenience, comfort and welfare of the inhabitants of the panchayat area concerned and everything incidental to the administration of the panchayat. A panchayat may, by resolution, supported by not less than one half of its strength, sanction the payment of a contribution towards the expenses of any panchayat conference or any contribution towards the expenses or reception of important personages or the expenses of any public exhibition, ceremony or entertainment.

Local body experts said that there were instances in the past when the state government has ratified utilisation of own fund for tours and flight expenses. "Since ASHA workers are directly involved in the health affairs of the people and health is a matter under the responsibility of the Panchayat, the local body can provide incentives from their own funds,” said Balan. With the local bodies including proposals in the budget, a resolution is not needed as the budget has already been passed by the respective committees, it is pointed out.

The sudden love for ASHAs shown by local bodies has also led to contention that this was politically motivated. "This sudden decision by Congress- and BJP-led local governing bodies could be driven by political mileage. Moreover, the government is unlikely to allow this, forcing these bodies to use their own funds," said a retired senior bureaucrat.

It will also put strain on local bodies which are not in good shape, financially. The second report of the sixth state finance commission noted that the own revenue of the local governments in Kerala registered a growth rate of around 8.37 per cent between 2008-09 to 2019-20. However, the ratio of own revenue to state's own revenue declined from 4.38 per cent to 2.90 per cent during the corresponding period mainly due to the absence of buoyancy of local government non-tax revenues which needs to be addressed.

Speaking in the Assembly on March 21, Excise Minister MB Rajesh said that a resolution for the strike seemed remote due to the protesters being 'stubborn and headstrong' and that the state government's attitude had nothing to do with it.

ASHAs currently receive a monthly honorarium of Rs 7,000, which is tied to the completion of 10 specific tasks such as managing clinics, preparing ward reports, and carrying out community outreach activities, with each task valued at Rs 700. On February 10, the Kerala ASHA Workers’ Association (KAHWA) began a sit-in protest outside the state secretariat, demanding the release of pending payments, an increase in the monthly honorarium to Rs 21,000, and retirement benefits of Rs 5 lakh.