Local democracy in disarray

Local democracy in disarray

Context

Twenty-five years after decentralised democratic governance was introduced, a look at why it has failed

Social failure

• While the economic reforms that were launched almost simultaneously with the decentralisation reforms made tremendous headway, making India the fastest-growing economy in the world today, local democracy has not much to write home about
• The village panchayats have not succeeded in enhancing the well-being, capabilities and freedom of citizens.

Reasons for a systemic failure

While the economic reforms were championed by the political class and received support from the bureaucracy, there was no perceptible hand-holding and support by the States to foster decentralised governance.

• There was no institutional decentralisation except in Kerala
• The roles and responsibilities of local governments remain ill-defined despite activity mapping in several States.
• States control funds, functions and functionaries, making autonomous governance almost impossible.
• Most States continue to create parallel bodies (often fiefdoms of ministers and senior bureaucrats) that make inroads into the functional domain of local governments.
• For example, Haryana has created a Rural Development Agency, presided over by the Chief Minister, to enter into the functional domain of panchayats.
• Legislative approval of these parallel bodies legitimises the process of weakening decentralised democracy.
• Increasing allocations to Members of Parliament Local Area Development Scheme, or MPLADS, which started in 1993, and their State-level counterparts, known as the MLALADS
• There is no mandate to create a DPC tasked to draft a district development plan that takes into account spatial planning, environmental conservation, rural-urban integration, etc.
• In States like Gujarat, the DPC has not been constituted. A potential instrument to reduce growing regional imbalances is left to rot.
• There is no credible fiscal data base and budget system among local governments now
• The Terms of Reference of the 15th Finance Commission, which sought to abolish Article 275 and ignore an integrated public finance regime, do not seem to opt for continuity
• Despite the reservation of seats for Adivasis, Dalits and women, these categories remain on the periphery, often as victims of atrocities and caste oppression rather than as active agents of social change
• Involving women’s agencies and the marginalised to lead social transformation at the grass-roots level remains an uphill task.
• Even after 25 years, local government expenditure as a percentage of total public sector expenditure comprising Union, State and local governments is only around 7% as compared to 24% in Europe, 27% in North America and 55% in Denmark
• The own source revenue of local governments as a share of total public sector own source revenue is only a little over 2% and if disaggregated, the Panchayat share is a negligible 0.3% (several States like Rajasthan, Punjab and Haryana have abolished property taxes and others do not collect taxes). This speaks of the fiscal weakness of village panchayats.

Conclusion

Local democracy in India is in deep disarray. Will the Prime Minister take time to look into this pathology and take remedial action in the interest of democracy, social inclusion and cooperative federalism?