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The devolution deficit -KC Sivaramakrishnan
-The Indian Express


Why we need to revisit the 74th Amendment

The National Panchayati Raj Day to mark the enactment of the 73rd Constitutional Amendment was observed on April 24 with due ceremony but little hype. Whatever the reasons for the celebration, even those are not available for the 74th Amendment dealing with municipalities.

The Government of India's first line of defence on this issue is that these are state subjects. Nevertheless, the Union government did enter the domain of the states substantially, despite opposition from chief ministers like Jyoti Basu, M. Karunanidhi and N.T. Rama Rao. Between the governments of Rajiv Gandhi, V.P. Singh and P.V. Narasimha Rao, the 73rd and 74th Amendments required five different drafts, two joint parliamentary committee reports and ratification by the states before they became law in 1992.

Article 243B requires every state to establish panchayats at the village, intermediate and district levels. In the case of municipalities, Article 243Q contains a similar stipulation, but it is followed by a proviso that a municipality may not be constituted in an urban area if it is specified as an industrial township where municipal services are provided by an industrial establishment. The preceding Article 243P states that a "municipality means an institution of self-government constituted under Article 243Q". The emphasis is on self-government, not on water supply and drainage. It should also be mentioned that this proviso was absent in the bill introduced in Lok Sabha in September 1991 and it was not an issue for consideration for the JPC. The proviso was introduced as a government amendment only after the bill was received from the JPC in July 1992 and a most important purpose of the 74th Amendment, that of creating constitutionally mandated municipal bodies of self-governance for all urban areas, was sidetracked.

According to Census 2011, there are 7,935 urban places. Of these, 4,041 are clothed in the garb of a corporation, municipality or nagar panchayat. The remaining 3,894 are only census towns, which have to remain content with that statistical certification. The list of such census towns without urban local self-government includes Noida and Kharagpur, and makes for extraordinary reading.

The Veerappa Moily Commission in its sixth report on local governance recommended that private townships and gated colonies, including SEZs, must be placed under the jurisdiction of a local body, though they may have some autonomy for provision of infrastructure and services and collection of user charges. In October 2007, the government formally accepted this recommendation. However, the Union and state governments have been quite eager to seize every opportunity to exclude territories from municipal administration.

The proviso to Article 243Q is not a mere loophole. The message it conveys is that a democratic dispensation is not compatible with development, in cynical disregard of the principal intent of the amendment, which is local self-government.

Much has been written about the functional and financial domain of urban local bodies. The 11th, 12th and 13th Finance Commissions have all urged clarity and enhancement of financial resources, including an independent tax domain. Both the M.N. Venkatachaliah and Moily commissions have urged mandatory functions. The 12th Schedule, which is no more than a list of 18 subjects, has become an embarrassment, because the general perception is that municipalities and corporations are mandated to perform most functions relating to these subjects. But the reality is that few tasks under these subjects have been entrusted to the municipalities.

As for public participation, the 74th Amendment contains a stipulation for ward committees. In pursuing the arithmetic parallel of numerical representation, as in panchayats, the diversity and complexities of different urban areas have not been adequately considered. Resisted by the states as an incursion into their powers and resented by elected representatives as undermining their domain, ward committees exist in a few states like Kerala and West Bengal, but hardly function.

The amendment also included provisions for a district planning committee under Article 243ZD to secure development planning for the district, addressing both rural and urban concerns. Similarly, under Article 243ZE, a committee for metropolitan planning is required to be set up for each multi-municipal metropolitan area with a population of 10 lakh or more. Unfortunately, the composition of the two committees heavily favours elected members of the panchayats and municipalities. The proportion is four-fifths of the total number in the case of DPCs and two-thirds for MPCs. According to a recent CPR study, in the metropolitan areas of Mumbai, Kolkata, Chennai, Bangalore and Hyderabad, non-municipal urban territories, special purpose bodies, elected representatives of the state legislature and Parliament, as well as business and industry, are important stakeholders. The restricted design of the MPC does not allow for flexibility or adequacy of representation. This is a major reason why the MPC, though a constitutional requirement, has not been set-up at all, except in Kolkata and Mumbai. Even in these areas, they are practically non-functional. What, then, is the purpose of letting this flawed amendment remain as it is?

As one who was privileged to be involved in the drafting of this amendment, I have to admit that if clarity is the objective, this piece of legislation leaves much to be desired. Yet, the intent of the amendment - democratic decentralisation - cannot be compromised by the letter of the law. It is time we revisited this amendment and considered the changes needed.

The writer is chairman of the Centre for Policy Research, Delhi, and former secretary, urban development, Government of India