A three-tier structure of the Indian administration for rural development is called Panchayati Raj. The aim of the Panchayati Raj is to develop local self-governments in districts, zones, and villages.

Rural development is one of the main objectives of Panchayati Raj and this has been established in all states of India except Nagaland, Meghalaya, and Mizoram, in all Union Territories except Delhi. and certain other areas. These areas include:

  1. The scheduled areas and the tribal areas in the states
  2. The hill area of Manipur for which a district council exists and
  3. Darjeeling district of West Bengal for which Darjeeling Gorkha Hill Council exists

Panchayati Raj Institutions

Panchayati Raj Institution (PRI) is a system of rural local self-government in India.

Local Self Government is the management of local affairs by such local bodies who have been elected by the local people.

PRI was constitutionalized through the 73rd Constitutional Amendment Act, 1992 to build democracy at the grassroots level and was entrusted with the task of rural development in the country.

Evolution of Panchayati Raj in India

  • After the Constitution came into force, Article 40 made a mention of panchayats, and Article 246 empowers the state legislature to legislate with respect to any subject relating to local self-government.
  • However, this inclusion of panchayats into the Constitution was not unanimously agreed upon by the then decision-makers, with the major opposition having come from the framer of the Constitution himself i.e. B.R.Ambedkar.
    • It was after much discussion among the supporters and opponents of the village panchayat that the panchayats finally got a place for themselves in the Constitution as Article 40 of the Directive Principles of State Policy.
  • Since the Directive Principles are not binding principles, the result was the absence of a uniform structure of these bodies throughout the country.
  • After independence, as a development initiative, India had implemented the Community Development Programmes (CDP) on the eve of Gandhi Jayanti, the 2nd October 1952 under the major influence of the Etawah Project undertaken by the American expert, Albert Mayer.
    • It encompassed almost all activities of rural development which were to be implemented with the help of village panchayats along with the participation of people.
    • In 1953, the National Extension Service was also introduced as a prologue to CDP. But the program did not yield much result.
  • There were various reasons for the failure of CDP like bureaucracy and excessive politics, lack of people participation, lack of trained and qualified staff, and lack of local bodies interest in implementing the CDP especially the village panchayats.
  • In 1957, the National Development Council constituted a committee headed by Balwant Rai Mehta to look into the working of community development programmes.
    • The team observed that the major reason for the failure of the CDP was the lack of people’s participation.
    • The committee suggested a three-tier PRIs, namely, Grama Panchayats (GPs) at the village level, Panchayat Samiti (PSs) at the block level, and Zilla Parishad (ZPs) at the district level.
  • As a result of this scheme of democratic decentralization was launched in Rajasthan on October 2, 1959.
  • In Andhra Pradesh, the scheme was introduced on 1st November 1959. The necessary legislation had also been passed and implemented in Assam, Gujarat, Karnataka, Madhya Pradesh, Maharashtra, Orissa, and Punjab, etc.
  • The appointment of the Ashok Mehta Committee in 1977 did bring new thinking in the concepts and practice of the Panchayat Raj.
    • The committee recommended a two-tier Panchayat Raj institutional structure consisting of Zilla Parishad and Mandal Panchayat.
  • In order to use planning expertise and to secure administrative support, the district was suggested as the first point of decentralization below the state level.
  • Based on its recommendation, some of the states like Karnataka incorporated them effectively.
  • In subsequent years in order to revive and give a new lease of life to the panchayats, the Government of India had appointed various committees.
  • The most important among them are the Hanumantha Rao Committee (1983), G.V.K. Rao Committee (1985), L.M.Singhvi Committee (1986) and the Sarkaria Commission on Centre-State relations (1988), P.K. Thungan Committee (1989), and Harlal Singh Kharra Committee (1990).
  • The G.V.K. Rao Committee (1985) recommended making the “district” as the basic unit of planning and also holding regular elections while the L.M.Singhvi committee recommended providing more financial resources and constitutional status to the panchayats to strengthen them.
  • The Amendment phase began with the 64th Amendment Bill (1989) which was introduced by Rajiv Gandhi seeking to strengthen the PRIs but the Bill was not passed in the Rajya Sabha.
  • The Constitution (74th Amendment) Bill (a combined bill for the PRIs and municipalities) was introduced in 1990, but was never taken up for discussion.
  • It was during the Prime Ministership of P.V.Narasimha Rao that a comprehensive amendment was introduced in the form of the Constitution 72nd Amendment Bill in September 1991.
  • 73rd and 74th Constitutional Amendments were passed by Parliament in December 1992. Through these amendments, local self-governance was introduced in rural and urban India.
  • The Acts came into force as the Constitution (73rd Amendment) Act, 1992 on April 24, 1993, and the Constitution (74th Amendment) Act, 1992 on June 1, 1993.
  • The following areas have been exempted from the operation of the Act because of the socio-cultural and administrative considerations:
    • Scheduled areas listed under the V Schedule in the states of Andhra Pradesh, Bihar, Gujarat, Himachal Pradesh, Madhya Pradesh, Maharashtra, Orissa, and Rajasthan.
    • The states of Nagaland, Meghalaya, and Mizoram.
    • The hill areas of the district of Darjeeling in the state of West Bengal for which Darjeeling Gorkha Hill Council exists.
  • In conformity with provisions in the Constitution Amendment Act, an Act called the Provisions of Panchayats (Extension to the Scheduled Areas) Act, 1996 passed by the Government of India.

Salient Features of the Constitution 73rd and 74th Amendments

  • These amendments added two new parts to the Constitution, namely, added Part IX titled “The Panchayats” (added by 73rd Amendment) and Part IXA titled “The Municipalities” (added by 74th Amendment).
  • Basic units of democratic system-Gram Sabhas (villages) and Ward Committees (Municipalities) comprising all the adult members registered as voters.
  • Three-tier system of panchayats at village, intermediate block/taluk/mandal and district levels except in States with population is below 20 lakhs (Article 243B).
  • Seats at all levels to be filled by direct elections Article 243C (2).
  • Seats reserved for Scheduled Castes (SCs) and Scheduled Tribes (STs) and the chairpersons of the Panchayats at all levels also shall be reserved for SCs and STs in proportion to their population.
  • One-third of the total number of seats to be reserved for women.
  • One third of the seats reserved for SCs and STs also reserved for women.
  • One-third offices of chairpersons at all levels reserved for women (Article 243D).
  • Uniform five year term and elections to constitute new bodies to be completed before the expiry of the term.
  • In the event of dissolution, elections compulsorily within six months (Article 243E).
  • Independent Election Commission in each State for superintendence, direction and control of the electoral rolls (Article 243K).
  • Panchayats to prepare plans for economic development and social justice in respect of subjects as devolved by law to the various levels of Panchayats including the subjects as illustrated in Eleventh Schedule (Article 243G).
  • 74th Amendment provides for a District Planning Committee to consolidate the plans prepared by Panchayats and Municipalities (Article 243ZD).
  • Budgetary allocation from State Governments, share of revenue of certain taxes, collection and retention of the revenue it raises, Central Government programmes and grants, Union Finance Commission grants (Article 243H).
  • Establish a Finance Commission in each State to determine the principles on the basis of which adequate financial resources would be ensured for panchayats and municipalities (Article 243I).
  • The Eleventh Scheduled of the Constitution places as many as 29 functions within the purview of the Panchayati Raj bodies.

PESA Act of 1996

The provisions of Part IX are not applicable to the Fifth Schedule areas. The Parliament can extend this Part to such areas with modifications and exceptions as it may specify. Under these provisions, Parliament enacted Provisions of the Panchayats (Extension to the Scheduled Areas) Act, popularly known as the PESA Act or the extension act.

Objectives of the PESA Act:

  1. To extend the provisions of Part IX to the scheduled areas.
  2. To provide self-rule for the tribal population.
  3. To have village governance with participatory democracy.
  4. To evolve participatory governance consistent with the traditional practices.
  5. To preserve and safeguard traditions and customs of the tribal population.
  6. To empower panchayats with powers conducive to tribal requirements.
  7. To prevent panchayats at a higher level from assuming powers and authority of panchayats at a lower level.

Issues

  • The grey area is the lack of adequate funds. There is a need to enlarge the domain of panchayats to be able to raise their own funds.
  • The interference of area MPs and MLAs in the functioning of panchayats also adversely affected their performance.
  • The 73rd amendment only mandated the creation of local self-governing bodies and left the decision to delegate powers, functions, and finances to the state legislatures, therein lies the failure of PRIs.
  • The transfer of various governance functions—like the provision of education, health, sanitation, and water was not mandated. Instead, the amendment listed the functions that could be transferred and left it to the state legislature to actually devolve functions.
    • There has been very little devolution of authority and functions in the last 26 years.
  • Because these functions were never devolved, state executive authorities have proliferated to carry out these functions. The most common example is the terrible state water boards.
  • The major failure of the Amendment is the lack of finances for PRIs. Local governments can either raise their own revenue through local taxes or receive intergovernmental transfers.
  • The power to tax, even for subjects falling within the purview of PRIs, has to be specifically authorized by the state legislature. The 73rd Amendment let this be a choice open to the state legislatures—a choice that most states have not exercised.
  • The second avenue of revenue generation is intergovernmental transfers, where state governments devolve a certain percentage of their revenue to PRIs. The constitutional amendment created provisions for State Finance Commissions to recommend the revenue share between state and local governments. However, these are merely recommendations and the state governments are not bound by them.
  • Though finance commissions, at every level, have advocated for greater devolution of funds, there has been little action by states to devolve funds.
  • PRIs are reluctant to take on projects that require any meaningful financial outlay and are often unable to solve even the most basic local governance needs.
  • PRIs also suffer from structural deficiencies i.e. no secretarial support and lower levels of technical knowledge which restricted the aggregation of bottom-up planning.
  • There is a presence of adhocism i.e. lack of clear setting of agenda in gram sabha, gram samiti meetings, and no proper structure.
  • Though women and SC/STs has got representation in PRIs through reservation mandated by the 73rd amendment but there is a presence of Panch-Pati and Proxy representation in the case of women and SC/STs representatives respectively.
  • Accountability arrangements remain very weak even after 26 years of PRIs constitutional arrangement.
  • The issue of ambiguity in the division of functions and funds has allowed concentration of powers with the states and thereby restraining the elective representatives who are more aware and sensitive to the ground level issues to take control.

Suggestions

  • Genuine fiscal federalism i.e. fiscal autonomy accompanied by fiscal responsibility can provide a long-term solution without this PRIs will only be an expensive failure.
  • 6th report of 2nd ARC, ‘Local Governance- An inspiring journey into the future’’, had recommended that there should be a clear-cut demarcation of functions of each tier of the government.
  • States should adopt the concept of ‘activity mapping’, wherein each state clearly delineates the responsibilities and roles for the different tiers of the government in respect to the subjects listed in Schedule XI.
  • The subjects should be divided and assigned to the different tiers on the basis of accountability to the public.
  • States like Karnataka and Kerala have taken some steps in this direction but overall progress has been highly uneven.
  • There is a need for bottom-up planning especially at the district level, based on grassroots inputs received from Gram Sabha.
  • Karnataka has created a separate bureaucratic cadre for Panchayats to get away from the practice of deputation of officials who often overpowered the elected representatives.
    • Such practices need to be replicated in other states for strengthening the true character of local self-governance.
  • The center also needs to financially incentivize states to encourage effective devolution to the panchayats in functions, finances, and functionaries.
  • Training should be provided to local representatives to develop expertise so that they contribute more in the planning and implementation of policies and programmes.
  • To solve the problem of proxy representation social empowerment must precede the political empowerment.
  • Recently states like Rajasthan and Haryana have set certain minimum qualification standards for Panchayat elections. Such necessary eligibility can help in improving the effectiveness of the governance mechanism.
  • These standards should apply for MLAs and MPs also and in this direction, the government should speeding up efforts for universal education.
  • There should be clear mechanisms to ensure that States comply with the constitutional provisions, particularly in the appointment and implementation of the recommendations of the State Finance Commissions (SFCs).
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