Context

The failure of the State governments to release funds in time has forced the local government heads to utilise either private resources or borrow large amounts to complete Panchayat activities and meet various targets.

Rural local self-governance in India:

• Panchayati Raj Institution (PRI)is a system of rural local self-government in India.
• PRI was constitutionalized through the 73rd Constitutional Amendment Act, 1992to build democracy at the grass roots level and was entrusted with the task of rural development in the country.
• This act has added a new Part-IX to the Constitution of India. This part is entitled as ‘The Panchayats’ and consists of provisions from Articles 243 to 243 O.
• In addition, the act has also added a new Eleventh Scheduleto the Constitution. This schedule contains 29 functional items of the Panchayats. It deals with Article 243-G.

In its present form and structure PRI has completed 30 years of existence. However, a lot remains to be done in order to further decentralization and strengthen democracy at the grass root level.

What is the basis of Local self-governance in India?

• Local self-governance is linked to the idea of subsidiarity and is typically grounded on two broad arguments.
  • First, it provides for the efficient provision of public goods since governments with smaller jurisdictions can provide services as per the preferences of their residents.
  • Second, it promotes deeper democracy since governments that are closer to the people allow citizens to engage with public affairs more easily.
• The democratic decentralization through the 73rd and 74th CAAhas entrusted the Local self-government with the main task of local governance, while the district administration plays an enabling and coordinating role.
• However, in several cases bureaucratic inertia and lack of empowerment of LSG (local self-government) have hindered the objective of decentralized local governance (enshrined in Art.40 of the DPSP), needing immediate reform in this regard.
• However, India is undergoing a centralising shift in its politics, economy, and culture.

What are the loopholes in the local governance structure?

• Limited autonomy and authority: Despite the constitutional promise of local self-governance, local governments, especially municipalities, operate with limited autonomy and authority.
  • Limitations include the discretion given to the States regarding the devolution of powers and levying of local taxes.
  • State governments are reluctant to implement the 74th amendmentas cities are economic powerhouses and controlling urban land is important for financing State governments and political parties.
• Narrowing the scope of Municipalities: The courts have also mostly interpreted the 74th amendment narrowly, allowing State governments to retain their control over cities.
  • The 2021 amendment transferred the powers of appointment of Grade C and D employees of municipalities from the Empowered Standing Committeeof the municipality to the State government-controlled Directorate of Municipal Administration.