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Holistic Panchayat Raj


Towards Holistic
Panchayat Raj

Arguing that “bad Panchayat Raj is perhaps worse then no Panchayat Raj”, the report stresses that Panchayat Raj must not deteriorate into sarpanch raj. To this end, the Report urges that PRIs be structured legally and administratively to function as collegiate bodies, with all elected members being involved in preparing programmes, key decisions being taken by the Panchayat as a whole and not at the whim and fancy of the President, and implementation being under the effective supervision of the Panchayat members concerned and not just the sarpanch

It is not by coincidence that this article carries the same title as our Report1, for this is by way of an introduction to a Report that we believe should be essential reading for all those who would like to see the fulfillment of Gandhiji’s dream for independent India. Replying to a query on his “Dream for Independent India”, he wrote in his journal, Young India, 10 September 1930:

“I shall work for an India in which the poorest will feel it is his country, in whose making he has an effective voice”

This vision is inscribed on the cover of the Report and constitutes its leitmotif.

There is no way in which the aam admi, let alone the poorest Indian, can have a sense of belonging in a Parliament in which his MP represents 15-20 lakh others, or an effective voice in decisions are taken in remote State capitals or Delhi, let alone even in the inaccessible reaches of the Collector’s office. 65 years after Independence, almost every Indian feels alienated from the political and administrative process, the sense of alienation being the greater the lower down the economic scale and social hierarchy that person finds himself or herself in, and also the more distanced he or she is geographically from the imposing Bhawans where his or her future is decided. Six and a half decades of democracy leave most individuals as distant from having an “effective voice” in the making of their country as their parents and grandparents were under colonial rule.

The one ray of hope is a return to Gandhian first principles. Gandhji wanted our democratic institutions to be built on the foundations of Panchayat Raj, as evidenced in the 1946 publication by Shriman Narayan Agarwal, A Gandhi Constitution for Independent India, that Gandhiji himself endorsed in entirety in the Foreword he wrote to the book.

After many travails, Parliament eventually incorporated key elements of the Gandhian vision in our scheme of government, by passing, virtually unanimously, the 73rd and 74th amendments to the Constitution in December 1992 followed by The Provisions of the Panchayats (Extension to Scheduled Areas) Act, 1996 [PESA] in December 1996, as required by Part IX(The Panchayats) of the Constitution. The Constitution describes PRIs as “institutions of self-government”, not self-governance, a distinction vital to the effective empowerment of the Panchayats.

Nearly a quarter century later, we have some Panchayat Raj but not “holistic” Panchayat Raj. Our Report aims at correcting that deficiency. More specifically, it aims to ensure far greater efficiency in the delivery of public goods and services by shifting the burden of bottom-up planning and last-mile delivery to the Panchayat Raj Institutions (PRI) from a bureaucratic mode of delivery that has patently failed.

How dramatically the present system of delivery has failed is well illustrated by two sets of irrefutable facts. One, whereas Central budgetary expenditure on social sector and anti-poverty programmes has grown by 25 times since the onset of economic reforms (from around Rs. 7500 crore in 1992-93 to over Rs. 2 lakh crore in the current budget), our ranking on the UN Human Development Index continues to hover around 135 as it did at the start of economic reforms. We appear to be like Alice in Wonderland: the faster we run, the more we remain where we were. The Report characterizes this as “treadmill growth”.

The second set of facts derives from the Twelfth Five-Year Plan documents: that whereas our economy has grown at nearly 8 per cent over the previous Plan period, the rate of poverty alleviation, which languished at under 0.8 per cent in the previous eleven years, is now averaging no more than 1.5 per cent per annum. Thus, widening disparity and inequality has been compounded by gross failure to make optimal use of the additional Government revenues generated by reforms even if the Union Government has evolved over 150 Centrally Sponsored Schemes, with very much higher budgetary allocations than could have been conceived of 25 years ago. This appalling waste of resources is much more disturbing than the so-called “leakages” affecting subsides or even the falling growth rates in the face of “stimulus” through revenues foregone in the amount of over Rs.25 lakh crore furnished to the productive elements of our economy since 2007.

Neither growth nor justice will be secured without more equitable sharing of resources between the 70 percent “poor and vulnerable” segments of our population, identified by the late Dr. Arjun Sengupta in his celebrated 2007 Report, and the better-off segments of our people on whom we are increasingly relying to enlarge the national cake.

While promoting equity in the distribution of incremental national income falls outside the ambit of our Expert Committee’s Terms of Reference, the more efficient delivery of public goods and services, particularly the 29 public goods and services listed in the Eleventh Schedule as the illustrative domain of Panchayat Raj, constitute the essence of what we have to say.

We find that, notwithstanding the inclusion of many areas covered by Centrally Sponsored Schemes (CSS) in the State List of the Seventh Schedule, in practice, the bulk of the funding for these programmes comes from the Central Government and is governed by CSS guidelines that are astonishingly detailed and have to be adhered to if funding to States under CSS is to be smooth and continuous. Indeed, one witness maintained that about 80 per cent of the work-time of a Joint Secretary in Delhi concerned with these programmes is taken up in ensuring that installments are released and Utilization Certificates (UCs) are examined in conformity with the guidelines.

Unfortunately, CSS guidelines only very rarely oblige State governments to effectively devolve Functions, Finances and Functionaries to Panchayat Raj Institutions. PRIs are occasionally mentioned as an option but in such a passing and casual manner that State bureaucracies prefer to themselves be the delivery agency or set up parallel bodies to do their bidding as registered societies (whose accounts are not subject to local or CAG audit). This leaches the entire delivery system of any responsibility to the intended beneficiaries. In the absence of accountability to the local community, and the transparency in transactions that such accountability would impose, while vast sums of money are expended and a widening network of gigantic mechanisms of delivery are devised, the beneficiaries themselves are, for the most part, reduced to beggars with their begging bowls or silent spectators to decisions that intimately impinge on the welfare of themselves and their families.

Thus, the principal reason for the failure of our systems of governance to make “the poorest feel it is their country, in whose making they have an effective voice” is that, notwithstanding the 73rd and 74th amendments, Panchayat Raj has little or no role in CSS. There are two exceptions to this generalization: MNREGA, that has given a place under the sun to the Village Panchayat (or, at any rate, to the village sarpanch) and the Backward Regions Grant Fund that makes grassroots planning the “sine qua non”, as Prime Minister Dr. Manmohan Singh has said, of the BRGF. If district planning in accordance with Constitutional provisions can be obligatory and mandatory for the most backward districts of the country, why can this not be done for the more advanced districts or, indeed, for other CSS in the same backward districts?

This failure in CSS has attained the most alarming proportions in tribal districts infected with Left-Wing Extremism (LWE). Notwithstanding the searing indictment in the Debu Bandyopadhyay Committee Report of 2008 on Development Challenges in Extremist-Affected Areas of the maladministration of development programmes in Fifth Schedule areas (that are almost co-terminus with LWE districts), the Integrated Action Plan for LWE districts, now under consideration for merging into BRGF, by-passes both Constitutional provisions as also PESA, thus alienating the local community from participative development. Without participative planning and implementation, there can be no inclusive growth. Inclusive growth without inclusive governance is the inevitable consequence of relying more on the bureaucracy and less on the people to set or attain development goals.

Our Report emphasizes that, notwithstanding various failed initiatives undertaken in the past decade, what appears to fundamentally confound the higher echelons of the bureaucracy in orienting CSS towards PRIs is an inadequate understanding of the processes involved in effective devolution. Therefore, the heart of the Report is the presentation of model Activity Maps for eight key CSS (National Livelihoods Mission ; National Drinking Water Mission and the Sanitation component of the Nirmal Bharat Yojana; Accelerated Irrigation Benefit Programme and Command Area Development Programme; Sarva Shiksha Abhiyan ; National Rural Health Mission; Integrated Child Development Services; Additional Central Assistance for Tribal Sub-Plans; Rajiv Gandhi Vidyutikaran Yojana) to demonstrate how to ensure an adequate role for PRIs in planning and implementation by devolving to them the 3 Fs (Functions, Finances and Functionaries) in a scientific, clear-cut manner on the basis of the principle of subsidiarity reflected through the prism of the basic principles of sound public administration.

The principle of subsidiarity holds that whatever can be done at a lower level must be done at that level and no higher level. Reciprocally, the principle of subsidiarity also holds that whatever cannot be done at a lower level must be done at the appropriate higher level and no lower. To determine the appropriate level for any given activity, the principles of sound public administration are invoked to provide for the categorization of activities to facilitate the process of deciding the appropriate level for devolution.

Where the Activity Maps included in Volume 4 of the Report go further conceptually than earlier exercises is in their going beyond Functions to also incorporate the parallel and simultaneous devolution of Finances and Functionaries to provide the PRIs with the wherewithal to effectively and efficiently undertake the duties that would devolve on them through the mandatory inclusion in CSS guidelines of Activity Maps for each CSS. Thus, for example, the Committee’s examination of the Guidelines for the Sarva Shiksha Abhiyan reveal that, as per the extant Guidelines, some 325 “activities” have to be undertaken before the teaching of “A for Apple; B for Ball” can even begin. Of these, approximately 200 activities must necessarily be undertaken at the Central or State level, and about 100 have necessarily to be performed at the district or sub-district or individual school level. The Committee’s Model Activity Map for SSA details which activity could ideally be attributed to which of the six levels of government involved (Centre, State, district panchayat; intermediate panchayat; village panchayat; and school-level) without, however, losing expert technocratic support as the existing registered societies (such as the School Management Committee) would either be brought under the PRIs or established with an integral relationship to the PRIs to render them accountable and responsible to the local community through Gram/Ward Sabhas. The Map also details which activity would require what share of finances and which agencies (Functionaries), bureaucratic or expert, for the optimal performance of the task. The Report recommends that explicit provision be made for all CSS Activity Maps to be projected as “models” to the States, leaving it to the States to modify the Activity Maps to suit local conditions. Thus, at the stage of implementation, Activity Maps would assume the character of State-specific Activity Maps that can be adjusted over time at the discretion of State governments or in consultation with the Centre, but all CSS would have State-specific Activity Maps carving out the domain of the PRIs in that State for each CSS.  

The suggested methodology for scientific devolution on the basis of objective criteria would end the apparent confrontation between State interest and PRI interests that has thus far stymied effective devolution. All six levels become cooperators in a joint endeavour to secure best results. No one is left out; all are included, and the Gandhian dream is progressively realised.

The suggested methodology also gives the lie to the common perception, reflected in the Twelfth Plan document, that Panchayat Raj being the responsibility of the States, there is little the Centre can (or should) do to push matters forward. In fact, had there not been the required “political will”, the longest and most detailed amendments ever to the Constitution could hardly have been passed virtually unanimously in both Houses of Parliament. If there were no “political will”, the approval to the amendments of half the State legislatures required before securing Presidential assent for the entry into force of the Bill would not have been obtained within four months, as actually happened. If there were no “political will”, there would not have been that large measure of adherence to mandatory Constitutional provisions in respect of Panchayat Raj as has actually been the case – such as the passage of State-level conformity legislation, regular Panchayat elections, reservations, independent State-level election commissions, State-level finance commissions, local and CAG audit and social audit. Nor would we have seen as many as 15 States increasing reservations for women from 33 per cent to 50 per cent, as has actually happened.

Finally, it needs to be emphasized that although the pattern of devolution to PRIs has been extremely uneven, with some States like Kerala and Karnataka (and, recently, Maharashtra) in the lead and others like UP and Jharkhand as laggards, a bird's eye survey of Panchayat Raj over the last two decades shows Panchayat Raj as advancing everywhere and some laggards leap-frogging over more advanced States to give remarkable returns. Several examples spring to mind: Kerala itself, that went in one leap in the second half of the 1990s from virtually no Panchayat Raj to first position; Tripura that undertook the same Great Leap Forward in the past decade; Bihar that has zoomed ahead in recent years converting despair into hope; Haryana, Himachal and Rajasthan, that have made remarkable progress. Some hill States like Sikkim and Uttarakhand have shown it can be done; others like Arunachal Pradesh are still to set their house in order. Some of the smaller States like Goa have performed well although problems remain. The Union Territories, a Central responsibility, have been among the worst laggards. Assam, Andhra Pradesh, Madhya Pradesh and Gujarat are among the bigger States that had a head-start but have since stagnated. Barring Maharashtra in recent years, all nine States with Fifth Schedule areas have turned in a most disappointing performance in respect of implementing PESA provisions. The list is incomplete, but illustrative of the important point that 'political will' is not entirely lacking, as so easily assumed by many.

What is more relevant is that “bureaucratic will” has been woefully lacking, especially in Delhi. The Report quotes at length from the path-breaking inaugural address by Prime Minister Dr. Manmohan Singh at the first conference of chief ministers he convened within a month of assuming office on “Rural Prosperity and Poverty Alleviation through Panchayat Raj” (29 June 2004) in which he laid out such a cogent and comprehensive road map for Panchayat Raj that the Committee have adopted the Address as the template for their own Report. Note is then taken of the Prime Minister’s directive to the Cabinet Secretary to circularise all Secretaries in charge of CSS to modify their respective CSS guidelines to bring them in conformity with Constitutional provisions. The Cabinet Secretary did so on 8 November 2004, with the added proviso that the exercise must be completed within two months and reported to him personally.

That, alas, was the end. Three years later, finding that no Central Ministry was taking the Prime Minister’s directive seriously, the Union Panchayat Ministery persuaded the Cabinet Secretary to set up a committee comprising a secretary from the Cabinet Secretariat and the Panchayat Raj secretary to interact with their counterparts and produce the first round of Activity Maps to facilitate effective devolution to the PRIs under their respective CSS. 15 schemes were selected, accounting for more than two-thirds of all CSS expenditure, and in full consultation with the secretaries concerned, finalised and submitted to the Cabinet Secretary on 22 January 2008. However, no action has followed. For the last five years, the exercise has remained deadlocked with the Cabinet Secretariat saying it will not do it and a hapless Ministry of Panchayat Raj pleading that it cannot do it.

The Planning Commission had evinced considerable interest in taking forward District Planning as envisaged in the Constitution. A committee was constituted under the chairmanship of the legendary champion of Panchayat Raj, Shri V. Ramachandran, former Vice-Chairman of the Kerala State Planning Board. Based on the V.Ramachandran committee recommendations, the Planning Commission issued detailed guidelines to the State governments, saying all State plans had to include the component of district planning before being brought to the Planning Commission for approval. Unfortunately, the Planning Commission then put its own guidelines into cold storage and now appears to have abandoned the exercise altogether, notwithstanding the Manual for District Planning circulated by the Planning Commission on 1 April 2009. The unanimous Report of the NDC’s Empowered Sub-Committee on Panchayat Raj also languishes unimplemented in the cupboards of the Planning Commission.

We thus see that it is bureaucratic recalcitrance rather than any lack of political will that is the main hurdle. Alternatively, it is perhaps bureaucratic ineptitude, a lack of understanding of the methodology for effective devolution, that is holding up the appropriate modification of CSS guidelines as ordered by the political authority nearly a decade ago. This lacuna has now been filled by our Report demonstrating, with respect to eight key CSS, how effective devolution can be promoted by ensuring the inclusion of model Activity Maps in all CSS guidelines.

Besides Activity Mapping, the Committee have undertaken a detailed survey of the policy issues and sectoral issues involved in working towards “Holistic” Panchayat Raj. In successive chapters of the first Part of the Report dealing with broad policy issues, the Report has focussed on State action on devolution; the technicalities of District Planning; the Finances of the Panchayats; the intricacies of training and capacity building (the longest chapter in the Report); women in the Panchayats; and disadvantaged sections of the population, such as SC/ST, people with disabilities, and religious minorities in the Panchayat system, including, at some length, the rampant transgression of the legal and constitutional rights secured by the tribals through the Fifth Schedule, the 73rd amendment, the Forest Rights Act and PESA.

In the second Part, the Report takes up sectoral issues by compartmentalising CSS into seven chapters covering the gamut of the subjects mentioned in the Eleventh Schedule. These relate to rural livelihood; rural infrastructure; the productive sectors of the rural economy; education; health; women-related programmes; and schemes for the disadvantaged. The last chapter summarises the principal Observations and Recommendations of the Committee.

It would be impossible to incorporate into an article of 3500 words the range of recommendations in a Report running to 1500 pages and five volumes. But three sets of what the Report calls “Collateral Measures” stand out.

First, arguing that “bad Panchayat Raj is perhaps worse then no Panchayat Raj”, the report stresses that Panchayat Raj must not deteriorate into sarpanch raj. To this end, the Report urges that PRIs be structured legally and administratively to function as collegiate bodies, with all elected members being involved in preparing programmes, key decisions being taken by the Panchayat as a whole and not at the whim and fancy of the President, and implementation being under the effective supervision of the Panchayat members concerned and not just the sarpanch. While this will secure transparency of transactions, it would also enable accountability to the Gram/Ward Sabhas and the effective exercise of social audit responsibilities by Gram/Ward Sabhas. The fulcrum of the system is the Gram/Ward Sabha. It needs to be statutorily empowered to undertake supervisory functions, reflecting community needs and community satisfaction with the planning and implementation of schemes of economic development and social justice as envisaged in Articles 243G and 243ZD read with the Eleventh Schedule. The Report points to the “holistic” nature of the 73rd and 74th amendments and, therefore, the necessity for a holistic approach to the implementation in letter and spirit of the provisions of the Constitution.

Second, the Report dwells at length on the “sound finances” of the PRIs. Apart from important recommendations for the functioning of State Finance Commissions and the processing of SFC recommendations, as well as accounting and audit of Panchayat finances, and measures to encourage PRIs to raise their own resources, the Report commends successive Finance Commissions for having emerged as the single most important source of untied funds for the PRIs. Stressing the importance of incentivising, on the one hand, State governments to devolve, and, on the other, for PRIs to adopt transparency and accountability in their transactions, the Committee have requested the current Fourteenth Finance Commission to raise the share of PRIs in the divisible pool from the present level of 2.5 per cent to 6-7 per cent, and to restructure the current pattern to provide for (i) basic and performance grants to States to incentivise them to devolve and (ii) similar basic and performance grants to PRIs to incentivise them to adopt transparent and accountable practices. This will both impart stability to PRI finances and reduce the scope for corruption.

The third key set of “collateral measures” recommended relates to the imperative of invoking all relevant provisions of the Fifth Schedule and Part IX of the Constitution, and PESA/Forest Rights legislation, for thwarting the growing menace of Naxalism, the single most important challenge to internal security, as pointed out by the Prime Minister. Security measures, of course, have their place in this task of national priority; so does development – but neither will suffice unless participative development, based on inclusive governance, as envisaged in PESA, is actualised. More than any other single factor, is the failure to operationalise PESA that has resulted in so serious a deterioration of security in Fifth Schedule areas; and as the Centre has the right (and duty) under the Fifth Schedule to issue “directions” relating to the administration of these areas, the Report recommends that in view of the patent failure of most Fifth Schedule State governments to live up to the promise of PESA, the Centre is obliged under the Fifth Schedule to take matters in hand. If Naxalism is thwarted by recourse to PESA, a dramatic example would follow for States to replicate to maintain democratic stability at the level where it matters most – the grassroots.  

Mani Shankar Aiyar The author is a Member of Parliament in the Rajya Sabha after having served three five-year terms in the Lok Sabha as also Minister of Petroleum and Natural Gas (2004-06), Youth Affairs and Sports (2006-08), Development of the North-East Region (2006-09) and Panchayati Raj (2004-09). He was awarded the Outstanding Parliamentarian’ award. by the President in 2006. He served for 26 years in the Indian Foreign Service (1963-89).


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