Ascertain extent to which ‘core functions’ (Water supply, Sanitation, Roads and other means of communication, Streetlights and maintenance of community assets) were entrusted to Panchayats through law; Estimate costs of providing and maintaining core services of an acceptably defined standard. Study incomes and expenditures of RLBs;
Many critical activities relating to performance of core functions, nearly universally entrusted to village level RLBs. Wide variation in scope and range of entrusted responsibilities related to core functions devolved upon Intermediate and District Panchayats, ranging from these levels having a commanding sweep of functions to perform, to those where they merely were given advisory powers.
Descriptive information on a checklist Consolidated numerical data for entire state Numerical data from random sample, as selected by FFC Consistency checks undertaken form an annexe to the study report
DistrictIntermediateVillage Own Revenues9.6(1.6%)3.8 (0.4%)72.6 (11.3%) Transfers from Centre118.2 (19.0%)217.4 (25.6%)372.1 (60.7%) Central Finance Commission28.1 (4.5%)22.2 (2.6%)72.4 (8.5%) Assigned and Devolved funds from State 96.4 (15.5%)190.5 (22.4%)98.7 (11.6%) Grants in Aid from State357.5 (57.6%)365.6 (43.0%)42.1 (4.7%) Other Receipts10.5 (1.7%)50.3 (5.9%)14.1 (3.2%) District level; total revenues620.3(100%)849.7(100%)672.0 (100%) Rs/capita (%), Growth per annum during to Village level RLB: 4%. Intermediate level: 12% District level: 9%.
S.No State All levels Total transfers (Rs crore) Per capita transfers (Rs) 1 Karnataka Gujarat Tamil Nadu Kerala Uttar Pradesh Madhya Pradesh Bihar Rajasthan Orissa Maharashtra Chhattisgarh Punjab West Bengal Uttarakhand Sikkim Assam Andhra Pradesh Himachal Pradesh Haryana Tripura Total
High volumes could be because of non-plan salary transfers (Karnataka, Maharashtra, Gujarat) or misclassification (Sikkim)
Village Panchayats (69.0%) (70.1%) (71.9%) (71.9%) (73.6%) (75.3%) Intermediate Panchayats (14.7%) (12.3%) (12.7%) (16.1%) (14.4%) (13.8%) District Panchayats (16.2%) %) (15.4%) (12.0%) (12.1%) (10.9%) Total transfers
Level Tier wise details (Rs crore) Village level Intermediate level District level Grand Total Category wise details (Rs. Crore) Immovable property tax Other taxes User charges and non-tax revenues Total
Differences in State wide and sample RLB data, with former showing considerably higher figures Classification of expenditures as capital and revenue expenditure showed inconsistencies; so total expenditures were taken into account.
TOTAL EXPENDITURE (At all Levels) Average per capita Roads and Bridges Water Supply Buildings/ Community assets Street Lighting Sanitation, Storm water drainage and solid waste Other means of communication Other capital Expenditure Total expenditure
Differences in incomes and expenditures year after year may arise due to the following factors – States might not have reported opening or closing balances under the revenue and/or expenditure heads; System of inter-agency transfer within the three levels of RLBs might not be recognized. Unspent money for agency functions might be recredited to higher levels, where it might be classified as revenues all over again.
Dichotomy between de-jure expression of devolution and de-facto operation of deconcentration Many programmes implemented through deconcentration shown to be nominally undertaken at RLB level, Wide variation in the extent of funds given to the District and Intermediate Panchayats. Inter-agency transfers and re-crediting of funds takes place between the three levels of RLBs Many State and Central level programmes operated through ‘Mission’ offices, at the District and Intermediate levels, which channelize funds for specific programmes and ring fence these from both deconcentrated departmental accounting systems, and the tiered local government system
Dichotomy between de-jure expression of devolution and de-facto operation of deconcentration Many programmes implemented through deconcentration shown to be nominally undertaken at RLB level, Wide variation in the extent of funds given to the District and Intermediate Panchayats. Inter-agency transfers and re-crediting of funds takes place between the three levels of RLBs Many State and Central level programmes operated through ‘Mission’ offices, at the District and Intermediate levels, which channelize funds for specific programmes and ring fence these from both deconcentrated departmental accounting systems, and the tiered local government system
The Flow - Centre -> Karnataka -> District (Kolar) -> Taluk (Mulbagal) -> Panchayats (30 nos) Analysis of Karnataka state budget ( ) undertaken – devolved schemes, ‘overlapping schemes’ and ‘non-devolved’ schemes. A list of parastatals and parallel bodies operating in relevant geographic vicinity. Fundamental investigation - What is the money that gets spent in the geographic jurisdiction of a Grama Panchayat? Major deliverable - A comprehensive spreadsheet database enabling slice and dice of data to obtain insights on the trail
List of all schemes (Centre, State etc) Salary/Non Salary Classification amidst others Schemes codes and link codes of all the schemes Subcomponents of each scheme Routing - ZP, TP, GP schemes Flow of money across institutions Allocated, Released, Received and Expended particulars
Devolved sector envelop (Plan + Non Plan) - Rs crores Devolved Plan - Rs crores Devolved Non Plan - Rs crores Salaries - Rs crores 55.2% of overall devolved amount is salaries 54% of ZP schemes are salaries A staggering 71% of TP schemes are salaries
Better inform all stakeholders in each State of the State-specific scenario, so as to hopefully trigger wider political debate on the crux of the issue, ie, fiscal devolution Advocate for nationally accepted parameters of how fund flows are to be attributed to RLBs, specifically on how to treat (a) non-plan salary transfers, (b) allocations to and expenditures made by parallel bodies and user groups, (c) revenue transfers from the State of shared taxes, and (d) inter-agency transfers and recoupment of funds