Mumbai: In April 2018, India marked the
silver jubilee of the passing of the 73rd Amendment to the Constitution, which
formalised the decentralisation of governance through panchayat raj
institutions (PRI) across the country. Part
IX of the Amendment made state legislatures responsible for
devolving powers to PRIs.
Over the years, the southern states have done
better than others in doing this. Kerala, Tamil Nadu, Maharashtra and Karnataka
topped the aggregate index for devolution in a 2015-16 report
entitled ‘Where Local Democracy and Devolution in India is Heading Towards?’
issued by the Ministry of Panchayati Raj (MoPR). Jammu and Kashmir, Uttar
Pradesh, Punjab and Jharkhand were poor performers, it added.
There are exceptions such as Tripura, which
has the highest-spending rural bodies in India, as IndiaSpend reported
in June 2015. Its per capita spending is almost double that of states with more
money and financial powers. But overall, there are challenges of finances,
transfer of functions and capacity of local governments to handle the work
given to them.
This stems from the fact that politicians and
bureaucrats are unwilling to relinquish power, said T.R. Raghunandan, an expert
on decentralisation and a former joint secretary in the MoPR, who took
voluntary retirement after serving 26 years in the Indian Administrative
Service. After retirement, Raghunandan helped establish the ipaidabribe.com
initiative in 2011, which crowd-sources reports on corruption from citizens. He
also co-founded a non-profit to work in the areas of decentralised public
governance and heritage preservation. He was a member of the committee on
decentralisation, a member of the state planning board in the government of
Karnataka, as well as principal consultant to several expert committees
constituted by the government of India on decentralised public governance.
In an email interview with IndiaSpend,
Raghunandan talked about the hurdles faced by local governments in rural and
urban areas, the reluctance of politicians and bureaucrats to allow the
devolution of powers to panchayats, and his perspective on corruption in India.
States such as Kerala, Karnataka and Tamil Nadu
are among the top
five for transferring functions, institutions and finances to PRIs.
Lately, the details related to the weightage given to 2011 population in the
15th Finance Commission (FC) has received a backlash from the southern states.
Do you think their reservations are relevant? What effect can it have on rural
and urban local governance and the process of decentralisation?
The backlash from South Indian states certainly
has plenty of substance. They are protesting because the 15th FC will take into
account their 2011 populations when suggesting formulae for horizontal and
vertical transfers [of central funds] to states.
These states say they are being punished for more
effective population control ever since the family planning programme was
announced in 1971. That is bound to have a bearing on the actual proportion of
allocations these states receive from the central government’s revenues
divisible pool, both for their own use and to supplement local governments’
finances.
The 14th FC was of the view that the use of dated
population data is unfair and concluded that a weight to the 2011 population
would capture the demographic changes since 1971, both in terms of migration
and age structure.
However, this is not directly relevant to the
issue of whether south Indian states are doing better than northern ones in the
devolution of powers and responsibilities to local governments. Arguably, even
if they were not, the use of 2011 population data will harm them.
While there are variations across states, the
economic survey 2017-18
noted that urban local governments in India generated 44% (in 2015-16) of their
total revenue from their own resources compared to panchayats which
overwhelmingly (about 95% in 2014-15) depend on devolution of funds from the
Centre. What are the challenges and solutions for resolving challenges to
cooperative fiscal federalism?
While urban local governments earn a higher
proportion of their revenues on their own as compared to panchayats, the fact
remains that both rural and urban local governments are significantly
underfunded to perform the tasks that are devolved to them under the law.
This does not mean that there is no scope to
raise more revenues at the panchayat and municipality levels. In this regard,
it is true that the panchayats have generally failed to utilise the revenue
handles that have been given to them by state governments under the law. While
some states, such as the southern states and Maharashtra, have had a generally
better track record, and Chattisgarh and West Bengal have been able to
undertake effective reforms in this regard, there is tremendous scope for
panchayats to increase their own revenues.
Unfortunately, it is quite often the lack of
capacity of states that has come in the way of panchayats raising their own
revenues. Tax administration needs human resources and funds, but where states
have not posted panchayat secretaries, or have one-person panchayat offices,
panchayats cannot be blamed for not collecting taxes.
Most of the solutions for strengthening fiscal
federalism have been repeated ad nauseum over the past two decades. They
comprise of (a) a clear assignment of functions, powers and responsibilities to
the local governments through activity mapping, (b) a clear budget window in
state budgets assigning funds to the panchayats to match the devolved functions,
(c) adequate staffing at the panchayat level, either through the state
assigning staff on deputation or enabling the panchayats to recruit their own
staff, and (d) the state being willing to provide capacity on tap to panchayats
to enable them to perform their functions, instead of running low-quality,
discontinuous, and haphazard one-off training programmes that deliver homilies
to elected representatives instead of squarely addressing the administrative
weaknesses of panchayats.
The biggest challenge is that higher-level
politicians and bureaucrats don’t want to devolve powers and responsibilities
to local governments, because they fear competition and being outclassed by the
latter in the delivery of essential goods and services. Higher level politicians
and bureaucrats have a vested interest in mystifying governance simply to
protect their monopoly.
In a 2015 article**,
you mention, “Over the last decade, the amount of money that goes to one
[panchayat] has increased tenfold but the staff has remained nearly the same.”
There seems to be very little in terms of building the organisational capacity
of PRIs and strengthening the skills of functionaries. What sort of investments
are needed to improve this?
To put matters bluntly, states do not know the
meaning of the word ‘devolution’. It means that exclusive powers and authority
are transferred to local governments, along with adequate fiscal allocations,
capacities (in terms of people and systems to perform, not in terms of training
alone) and accountability systems to ensure that people can hold their local
governments accountable.
What we run in India through the panchayats is an
extension office of the rural development department in villages. Panchayats
are basically run as agencies of the state government, implementing rigid
schemes through officers nominally posted at that level who owe allegiance to
higher official channels than to elected representatives.
The elected representatives are scoffed at,
ignored, or treated with hostility, particularly if they are outspoken. They
are universally condemned as being transactional and corrupt. They are not at
the table when crucial policy decisions are taken on how panchayati raj should
be reformed. This is hardly devolution.
One of the big weaknesses of Indian
administration is that it is under-capacitated in many ways. While many
departments are top-heavy and centralise their administration through multiple
levels of scrutiny in order to give something to do to redundant higher-levels
officers, at the field level they typically suffer from grievous shortages of
staff. This shortage pans itself across both local governments and departments
that are not decentralised.
In such circumstances, the finance, planning and
personnel departments of states need to take a serious look at how much
investment needs to be put into the hiring and placement of well-qualified
staff, regardless of whether they wish to run a decentralised or centralised
system. Sadly, not one state thinks of these matters in the long term. Interim
solutions include hiring people on contract, and even running departments
through consultants hired through external funding. There cannot be a greater
abdication of responsibility by states.
New Zealand has a remuneration authority for
setting remuneration for elected members of local authorities. Would a similar
body in India help uniformly establish honorarium/salary and benefits from
panchayats to state legislatures and members of parliament? What has been the
effect of the non-uniformity in salaries at different governance levels?
New Zealand is a unitary country. India is a
federal country with huge variations in culture, democratic practice,
habitation patterns, climatic conditions, service-delivery requirements and
cost of service delivery. In such circumstances, having a single remuneration
authority will not make sense.
Having said that, there is indeed a need to
establish a set of norms for how much legislators and other elected
representatives ought to be compensated. Politics is no longer to be wholly
regarded as selfless public service. There is an opportunity cost to be
considered if politics is to attract quality professionals. Otherwise, even the
best are likely to become corrupt, first, in order to catch up on the lucrative
incomes that they may have foregone to join politics, and then, to rake in the
moolah while the good times last.
I have been involved in research studies of
panchayat members, which show that while they are under pressure from their
voters to perform, they do not have the staff to competently deliver services.
In such circumstances, panchayat members
themselves take on quasi-executive duties and incur expenditure to undertake
legitimate governance activities. As the sitting fees paid to them are not
adequate to cover such expenses, even the best of them are drawn to indulge in
need-based corruption, by which they skim off just enough money from government
contracts and procurements to compensate for the expenditure they incur.
Such practices also open them to blackmail by
corrupt officials who are often on the lookout for chinks in the armour of
honest elected representatives.
Having state-wise remuneration authorities would
be a good way to bring these issues out in the open and take pragmatic
decisions based on the fundamental principle that everybody involved in
governance, whether as elected representative or staff, ought to be compensated
adequately. Only then will we be able to take a hard line on curbing
corruption.
India was ranked
81st among 180 countries in the global corruption perception index 2017, after
falling two places from the previous year. What has been the effect of
corruption on local governance?
There is an oft-repeated statement that
decentralisation amounts to only decentralisation of corruption. When this
argument is made by those in the upper echelons of power, it reeks of hypocrisy
and condescension. So what do these people mean, exactly? That corruption is
better when centralised?
India’s ranking of corruption is hardly based or
dependent on whether it has decentralised (which it has not). India is corrupt
because we have no clue how to address corruption in a holistic or
comprehensive manner, and instead, we merely engage in discontinuous, random
steps to curb it.
What India needs is an anti-corruption strategy;
one which takes a systems approach to curbing and eliminating corruption. We
will be condemned to languish at the 80th position or so, for the next decade,
if things don’t change.
The Pathalgadi movement
in Jharkhand is an assertion of local governance
where in some parts stone slabs have been inscribed with features of the
Panchayat Extension of Schedule Areas (PESA) Act. While the state government is
wary, how do you view such attempts to self-rule or govern? How can
contestation of land and approach to local governance be resolved in such
contexts, where development is low due to historic and socio-economic reasons?
This was bound to happen. I think it’s a natural
outcome of having strong laws but very weak implementation. If the PESA were
implemented with sincere intentions, it would have given tribal communities
some chance at true self-governance in the spirit of their traditional
approaches to participatory governance. However, the oppressive capturing of
the spirit of PESA and its overturning by the same bureaucratic system that it
aimed to supplant, will eventually lead to people repudiating the state.
I don’t believe that local governance can be weak
simply because development as we observe it is measured to be low. I find that
tribal communities have a greater sense of self-governance as compared to
so-called developed communities, say, in urban areas, who are only too willing
to be led by the nose by higher-level governments and who hardly have any
understanding of the potential of local governments as a way to seize and
decentralise power to enable local action.
Although on paper the law provides for
decentralised decision-making at the gram panchayat level for many policies and
schemes of the central government, overarching policies such as Aadhaar tend to
centralise the entire process. Under such circumstances, would you believe that
the spirit of decentralisation has been repeatedly affected due to unclear
policy paths?
Till now, I would say that the progress of
decentralisation was stymied by unclear policy paths. But we must remember that
decentralisation is always in transition as capacities change and new
techniques and technologies emerge that make the delivery of services efficient
at some level other than the local. This has been predicted in the literature
on fiscal federalism.
[Public economics expert Albert] Breton observed,
in competitive governments, from a fiscal and service delivery perspective,
decentralisation is about managing externalities in service delivery and
governance action. As a logical extension of this argument, Jack Weldon, an
academic who worked on decentralisation, observed that if at any time a
higher-level government was in a position to manage all externalities, then the
rationale for multi-level governance would disappear. While I am personally
very wary of Aadhaar as I believe it seriously compromises privacy, I cannot
but concede that Aadhaar is arguably one such instrument that can change the
scales of service delivery dramatically.
Therefore, it is bound to have an effect of
decentralisation of service delivery to local governments. I also anticipate
that the future, with its reliance on artificial intelligence, blockchain, and
other technologies that transcend national boundaries, will not only affect the
way we look at local governments, but also how we consider national
sovereignty. It is likely that in future the only real justification for local
governments will be our enduring need to stick together on the basis of
identity, culture and commonality of political beliefs, rather than on
economist-generated ideas of efficient service delivery.
We’ll have panchayats in future because they
represent our identities, not because they can deliver water or education or
sanitation services better. That may be an additional benefit, but it might not
be the glue that holds us together in our local governments.
The government has allowed lateral entry into
the bureaucracy to bring in specialists. Is it a step in the right direction?
Yes, I think it’s a good thing, though I have
serious misgivings about the rather non-transparent way in which this is being
tried out at the moment. Monopolies are never good for incentivising the
striving for more quality.
When an individual, however gifted, is guaranteed
a certain measure of stability and assured progress in her career, you can bet
that she has no incentive to improve. The bureaucracy must be kept on its toes
and lateral entry is a good way to do that. Have you noticed that nearly all
articles critical of lateral entry have been written by former or serving
bureaucrats?
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Yet it would be wrong to lay all the blame for rampant corruption on decentralisation. Corruption does not increase as a result of decentralisation. It just gets detected faster and is more visible.
There are ways to reverse this trend. First, the institution of the gram sabha has to be strengthened. Unfortunately, the term gram sabha is considered to be a meeting, though the Constitution defines it as an association of voters. There is a dire need to improve the quality of deliberation within gram sabhas so as to make them truly inclusive, through smaller group discussions and workshops rather than large meetings, which tend to get dominated by vocal and powerful mobs.
Second, the gram panchayat’s organisational structure has to be strengthened. Over the last decade, the amount of money that goes to one has increased tenfold but the staff has remained nearly the same. Panchayats are burdened with work from other departments (conducting surveys, undertaking censuses, distributing benefits) without any compensation. Need-based corruption is then inevitable. Gram panchayats should be enabled to hold state departments accountable and to have them provide quality, corruption-free services.
Third, we can never have accountable panchayats if they don’t collect taxes. In Karnataka, panchayats are not utilising their powers to collect property tax and user charges fully. They know that if they collect taxes, voters will never forgive them for misusing their funds. Tax collection results in higher accountability.
In the overall analysis, improving the
functioning of democratic institutions is a constant battle that must not be
given up. A centralised system is far worse and much less accountable than
panchayati raj.
Article:https://indianexpress.com/article/opinion/columns/begin-with-gram-sabha//indianexpress.com/article/opinion/columns/begin-with-gram-sabha/
