Mains Practice Questions

Approach:

• Introduce the answer by briefing about constitutional amendments promoting democratic decentralization in India
• Delve into the provisions of 73rd and 74th Constitutional Amendments of 1992
• Give Key Constraints Hindering Effective Democratic Decentralization
• Suggest Measures for Strengthening Democratic Decentralization
• Conclude suitably.

Introduction

The promise of democratic decentralization, as envisioned through 73^rd and 74^th Constitutional Amendments of 1992 were landmark reforms aimed at empowering Panchayati Raj Institutions (PRIs) and Urban Local Bodies (ULBs) by giving them legal recognition and specific functions in governance.

• Despite these legal advancements, democratic decentralization faces numerous constraints that prevent local bodies from becoming effective instruments of self-governance.

Body:

Promise of Democratic Decentralization: Constitutional Provisions and Amendments

The 73^rd Amendment (for Panchayats) and the 74^th Amendment (for Municipalities) are pivotal for local governance in India. These amendments brought the following reforms:

• Three-Tier System: Rural areas have a system of Panchayats at the village, intermediate, and district levels, while urban areas are governed by Municipalities and Municipal Corporations.
• Elections and Reservations: They mandated direct elections to local bodies and reserved one-third of the seats for women and marginalized communities (SCs/STs).
• Fiscal Devolution: Provision for a Finance Commission at the state level to recommend financial devolution to local bodies.
• Planning and Development: Panchayats were entrusted with preparing plans for economic development and social justice on the subjects in the Eleventh Schedule, including agriculture, health, education, and rural development.

Despite these progressive measures, the core promise of decentralization remains hindered by structural and functional constraints.

Key Constraints Hindering Effective Democratic Decentralization:

• Fiscal Dependence and Weak Revenue Autonomy: According to the RBI Report (2022-23), Panchayats generated only 1% of their revenue through taxes, with 80% coming from central government grants.
  • Local bodies face a serious revenue autonomy issue as they do not have control over critical sources of income such as land revenue and professional tax.
  • The State Finance Commissions (SFCs), which are supposed to ensure financial devolution, often fail to implement their recommendations, further restricting the fiscal capacity of local governments.
• Limited Representation and Participation: While the 73rd and 74th Amendments reserved seats for women, SCs, and STs, the actual political power often remains with dominant groups.
  • As highlighted in the Webseries Panchayat, Women sarpanches (village heads) and councilors often face proxy representation (Pradhan Pati), where male family members exercise power.
  • This severely undermines the effective empowerment of women and marginalized communities.
    • Furthermore, there is a lack of capacity-building programs and institutional support, making it difficult for marginalized groups to play an active role in governance.
• Political and Bureaucratic Interference: Local bodies often face political interference that undermines their decision-making power.
  • According to the Ashok Mehta Committee, local governance remains controlled by state governments, which restricts the autonomy of Panchayats and ULBs.
  • The transfer of 29 subjects under the 11th Schedule to Panchayats remains inconsistent, as states hesitate to cede control over certain subjects.
  • This results in a structural contradiction, where local bodies are responsible for service delivery but lack the power to execute decisions effectively.
• Corruption and Electoral Reluctance: Corruption and electoral considerations also hinder effective governance.
  • Elected representatives often hesitate to impose taxes, such as property taxes, out of fear that doing so will negatively impact their electoral prospects.
  • In many areas, this reluctance to collect taxes results in insufficient local revenue, making local bodies overly reliant on external grants.
  • Additionally, the freebie culture in certain regions has discouraged tax compliance, as local governments avoid enforcing taxes for fear of losing political support.
• Weak Institutional Capacity for Monitoring: A major issue is the inconsistent implementation of key provisions, such as District Planning Committees (DPCs), which remain non-functional in several states.
  • A 2020 report indicated that many DPCs failed to prepare integrated plans in 15 states, and in urban areas, staffing vacancies in municipal corporations were found to be around 30%.

Proposed Measures for Strengthening Democratic Decentralization:

• Enhancing Fiscal Autonomy: States must ensure the timely implementation of SFC recommendations, and local bodies should be encouraged to generate own-source revenue (OSR).
  • The Second Administrative Reforms Commission (2nd ARC) recommended enhancing the revenue base of local bodies and introducing transparent fiscal devolution mechanisms.
  • Additionally, municipal bonds and pooled financing mechanisms (like the Indore Model) should be encouraged to diversify revenue sources
• Empowering Local Bodies with Administrative Autonomy: Local governments should be granted full administrative autonomy, including the power to recruit personnel, regulate service conditions, and independently plan and execute budgets.
  • The practice of state governments approving local budgets should be abolished, enabling elected representatives to exercise complete control over their financial decisions.
  • Additionally, Panchayats and ULBs should be equipped with dedicated secretariats and trained staff to handle administrative tasks effectively.
• Improving Accountability through Participatory Governance: Engaging citizens in decision-making through Gram Sabhas and Ward Committees can lead to inclusive governance.
  • The Balwant Rai Mehta Committee emphasized the importance of community participation in governance, which should be made mandatory for enhancing accountability and responsiveness.
• Capacity Building and Training: Local governments should be equipped with the technical expertise to implement these tools, building on the recommendations from the G.V.K. Rao Committee.
  • The establishment of Local Governance Training Institutes (LGTIs) in each state can help bridge this gap by offering continuous training programs for elected officials and officials.
  • Furthermore, e-Governance tools should be integrated to improve efficiency, transparency, and service delivery in local governance.
• Strengthening Urban Governance: The Mayor-in-Council system, as suggested by the 2nd ARC, can streamline governance by providing a directly elected mayor with executive powers.
  • Additionally, urban local bodies should focus on land banks and municipal bonds to generate revenue independently of state allocations.
  • PPP models should be promoted for infrastructure development to reduce dependence on state transfers.

Conclusion:

To achieve true democratic decentralization, India must focus on the Three F's: Fiscal Autonomy for financial independence, Functional Autonomy for decision-making powers, and Fair Representation to ensure inclusive governance and active citizen participation. Only then can the vision of Gram Swaraj and urban self-rule truly take root in India's democratic fabric.