Govt orders unused land acquisition funds returned to treasury within 30 days

The government has ordered the return of all unused and unspent funds held under the Land Acquisition Contingency (LAC) account in old land acquisition cases to the government treasury within 30 days.

The directive aims to strengthen transparency, accountability and financial discipline in the management, expenditure and record-keeping of funds allocated for incidental costs related to land acquisition.

The government issued the new policy titled “Land Acquisition Contingency (LAC) Fund Management Guidelines, 2026” through an extraordinary issue of the Bangladesh Gazette on August 31.

Under the guidelines, all unused funds held in LAC accounts for land acquisition cases whose files have been preserved in record rooms through consignment and for which three years have passed since completion of the Award Adjustment audit must be deposited into the Consolidated Fund of the Republic.

The money must be transferred within 30 days from the date the guidelines were issued, according to the directive.

The guidelines stipulate that unspent funds from a completed land acquisition case may be retained in the relevant account for a maximum of three years. Although the money may be used for approved incidental expenses during this period, any remaining balance must be deposited into the government treasury after three years have elapsed from the handover of land possession and completion of the audit, with the Ministry of Land duly informed.

The new policy also requires compensation money received from beneficiary organisations or individuals for land acquisition cases to be maintained separately from LAC funds in dedicated Personal Ledger (PL) accounts.

The guidelines clarify that LAC funds do not constitute direct government revenue or income. Instead, they are intended solely to meet incidental expenses related to specific land acquisition cases and project implementation. Separate registers and cash books must therefore be maintained for the funds.

The government has also set specific rates for collecting LAC funds. Government and autonomous bodies will be charged 3 per cent of the estimated acquisition cost for projects valued at up to Tk 1 crore and 2 per cent for projects exceeding Tk 1 crore.

For private organisations and privately owned projects, LAC funds will be collected at a flat rate of 10 per cent of the estimated cost, regardless of the project value.

Funds from one land acquisition case generally cannot be used for another case. However, in exceptional circumstances, transfers or adjustments may be made with prior approval from the Finance Division through the Ministry of Land.

To strengthen oversight, district commissioners will be required to submit annual statements detailing LAC expenditure and case-wise unspent balances to the Ministry of Land through divisional commissioners.

The entire accounting process must comply with prevailing financial rules and regulations, while the Office of the Controller of Accounts (Revenue) under the Ministry of Land will conduct audits of the accounts.

The new guidelines take immediate effect and supersede all previous instructions and circulars concerning the management of LAC funds.