(1) The district fund shall be charged with the payment of the expenses of the district-post, the payment of the expenses of pauper lunatics sent to public asylums from the area under the authority of the district board, the expenses incurred in auditing the accounts of the district boards and local boards, and such portion of the cost of the Provincial Departments for education, sanitation, vaccination, medical relief and public works as may be held by the Local Government to be equitably debitable to the district board in return for services rendered to the board by those Departments.
     (2) Subject to the charges specified in sub-section (1), and to such rules as the Local Government may make with respect to the priority to be given to the several duties of the board or otherwise, the district fund shall be applicable to the payment, in whole or in part, of the charges and expenses incidental to the matters specified in sections 20, 27, 28 and 29, and to the provision of grants-in-aid to educational and medical institutions, within the area subject to the authority of the district board, and, with the sanction of the Commissioner, outside that area when such application of the fund is for the benefit of the inhabitants of that area.