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| Home > Archive > Article: The Elected Representatives, the Executive and the Knowledge Gap |
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The Elected Representatives and the Executive: the Widening Knowledge Gap
Sharadini Rath
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Representative democracy has been the defining characteristic of the Indian State since Independence but there have been many changes made to the practical ways in which it functions. The world has changed nearly beyond recognition since the Constitution was first drafted and these changes have been accelerated the most since the early 1990’s when India went into the ‘liberalized’ mode, with global economic activities and trends firmly and irrevocably entering Indian economic policy arenas. This has been accompanied by the introduction of technology into the lives of common people at an ever increasing pace, both in terms of the durable goods available to the consumer and in the modes of manufacture. The telecom sector has seen the most dramatic of such booms with mobile technology taking root in all parts of the country. All these have also had a profound impact on the way government functions.
New Arms to the State Government
The structure and the functioning of the executive arm of government have responded rapidly to these changes. This has made the process of governance itself multilayered and far less monolithic than it used to be until the late 1980’s. One of the manifestations of this multilayered structure of governance is a proliferation of State owned/ run bodies such as corporations, regulators and societies that carry out specific functions of the government in much more loosely connected ways. Vast sums of money are devolved to these bodies along with a large share of the State’s functions, while at the same time making them somewhat more removed from the processes of checks and balances and political control. This happens primarily for two reasons. The first is that the functions that these bodies carry out are deemed to be specific enough by themselves and also saving a large enough portion of the energies of the government to justify their creation as separate entities. The second reason is that they often deal with the technical aspects of the implementation of government policy, which is understood by very few within the legislature itself. While elected bodies at both the Union and State levels retain final control over these bodies, they lack the technical ability to oversee their functioning by themselves, doing so only through the intermediate government functionaries. It is in this sense that government now functions with a far more multilayered structure than it ever did before. The monolithic nature of ministries and departments, where the political wing once held complete sway, is being changed fundamentally by the pressures of a globalized economy and technological necessity.
It is in this atmosphere of rapidly changing modes of governance that I wish to examine the basic tenets of political representation. After all, the Constitution addresses itself solely to the Union and State legislatures, leaving it to their collective wisdom to structure the implementing arm of governance (the executive) to suit the demands of the times and also retain the flexibility to change appropriately. If the legislatures are to do this ‘on behalf of the people’, then in the changed circumstances of the country as a whole and given the fact of the changing relationship between the legislature and the executive, what happens to representation and the way it manifests itself? Have we been able to adapt at all?
Instead of attempting the impossible by addressing this issue in the context of the country as a whole, I will do so in the restricted environs of the small to medium towns and cities of India. Urban India has always had a dichotomous position in the political economy of the country. Early policies of industrialization and much of the economic gains that the country has made in the last 15 years have been rooted in urban centers, usually the larger ones with histories of trade and manufacture.
The Ambiguous Position of the Urban Electorate
The business elite of India subscribe firmly to urban, and not rural, sensibilities but electoral politics has been firmly rooted in rural India. This is simply a matter of where most of the voting population resides. As a result, while urban centers are seen as the places where the real economic growth takes place, representation must still dominantly appeal to rural concerns to succeed in electoral politics. Urban populations, largely made up of inhomogeneous migrant groups that rarely share a strong enough bond to come together on a political platform, offer electoral constituencies that are hard to manage and do not pay large enough dividends in terms of political power. The business class has always connected itself to the political one not as a part of the urban population, but more through lobbies for favorable policy making where they compete with strong rural/ agricultural interests. If anything, the business elite have tended to set themselves apart from the large mass of the urban underclass, for good reason. This leaves the urban centers of India in a representational limbo; they are too small to win in the numbers game and too fractured to carry weight locally.
The profound changes in the overarching structures of governance and the ambiguous political position of the urban population (which remained at the forefront of economic growth) finally induced the Union Government to act. The Union Government therefore passed an act taking cognizance of the need for better urban governance, with a focus on providing of basic amenities and developing infrastructure – the immediate needs to be addressed.
Empowering Urban Local Bodies
In the defining preamble to Article 243 or the 74th Amendment of the Constitution of India, the reasons for passing such an act are clearly given:
In many States local bodies have become weak and ineffective on account of a variety of reasons, including the failure to hold regular elections, prolonged supersessions and inadequate devolution of powers and functions. As a result, Urban Local Bodies are not able to perform effectively as vibrant democratic units of self-government.
Having regard to these inadequacies, it is considered necessary that provisions relating to Urban Local Bodies are incorporated in the Constitution particularly for-
| 1 |
Putting on a firmer footing the relationship between the State Government and the Urban Local Bodies with respect to- |
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a |
The functions and taxation powers |
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b |
Arrangements for revenue sharing |
| 2 |
Ensuring regular conduct of elections; |
| 3 |
Ensuring timely elections in the case of supersession; |
| 4 |
Providing adequate representation for the weaker sections like Scheduled Castes, Scheduled Tribes and women. |
To further and more clearly define the powers, the authority and the responsibilities of Municipalities, the act lays down the following guiding principles to be followed by State Legislatures in formulating laws governing municipal functioning:
| (a) |
The Municipalities with such powers and authority as may be necessary to enable them to function as institutions of self-government and such law may contain provisions for the devolution of powers and responsibilities upon Municipalities, subject to such conditions as may be specified therein, with respect to- |
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(i) |
The preparation of plans for economic development and social justice; |
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(ii) |
The performance of functions and the implementation of schemes as may be entrusted to them including those in relation to the matters listed in the Twelfth Schedule; |
| (b) |
The Committees with such powers and authority as may be necessary to enable them to carry out the responsibilities conferred upon them including those in relation to the matters listed in the Twelfth Schedule. |
In order for there to be sufficient command over resources to carry out these functions, the act then sets out the following principles for the economic feasibility of these Municipalities:
| (a) |
Authorize a Municipality to levy, collect and appropriate such taxes, duties, tolls and fees in accordance with such procedure and subject to such limits; |
| (b) |
Assign to a Municipality such taxes, duties, tolls and fees levied and collected by the State Government for such purposes and subject to such conditions and limits; |
| (c) |
Provide for making such grants-in-aid to the Municipalities from the Consolidated Fund of the State; |
| (d) |
Provide for constitution of such Funds for crediting all moneys received, respectively, by or on behalf of the Municipalities and also for the withdrawal of such moneys therefrom. |
These are all addressed to the State Legislatures to form the basis on which each State can formulate its own preferred way of setting up the governance structure of municipalities. That all Municipal Acts passed by the State Legislature address themselves fundamentally to the elected representatives of the Urban Local Governments is in the manner of the constitutional mandate of both the Union and State governments.
In this article I will attempt to present qualitative and quantitative data that shows more than a decade after the 74th, some aspects of the state of the Municipality in Karnataka in terms of finances, functional ambit, and its relationship with the State Government. The issues of governance capability and the relationship with the State Government are often either perceptional within the institution of the Municipality or lie within the complex realms of political and administrative channels of governance that can be termed ‘informal’. In order to have a good basis for giving a picture of this aspect of municipal functioning, it will be useful to put some factual information pertaining to the state of municipal finances before the reader.
A Ground-level Investigation
It is often claimed that a good tax policy is one that is administered well, and a large part of good governance lies in good tax administration. One of the major powers of taxation devolved to municipalities under the 74th was the power to collect taxes on properties. Until 2001 the method of calculating this tax was based on the Annual Rental Value, which is assessed by the municipalities, and some percentage of this was raised as the property tax demand. Karnataka put into place a new tax regime for urban areas called the Self Assessment Scheme (SAS) in April 2002. This had two parts to it. It changed the formula used to calculate taxes on properties, using an area based rate with various other factors such as type of property and its age being taken into consideration. It also changed the way the tax was administered. Instead of raising demand and sending out bills to property owners, SAS mandated that property tax owners could calculate their own tax and pay it to the municipalities. Of course, there were time limits and municipalities could impose penalties for late or non-payment. However, it was a major tax reform for municipalities, both for tax calculation and tax administration. This entire reform was to be accompanied by Geographical Information System (GIS) surveys of all urban areas that would update and complete the list of taxable properties using the latest technology.
This was meant to achieve two things. The first was that it would broaden the tax base by identifying all properties and therefore bringing them into the tax net. The second was that it would increase compliance since it was both transparent and easy to do so. The expectation was that this would increase the property tax collections of municipalities by a large percentage and make them far more financially independent. The share of State devolutions to urban centers could then be reset based on what the municipalities could achieve within their own revenues.
The tables below give an idea of what happened to property tax collection to two sets of cities in Karnataka over the period 2001 to 2006. The first seven cities are those that share a boundary with the Bangalore city corporation. And the other three are located far from Bangalore, Karwar on the coast and Nippani and Gokak, which is near the northern border with Maharashtra.
Table 1: Percentage rise in property tax and total revenue for seven peri-Bangalore centers from 2002-03 to 2004-05
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% rise from 2002 to 2005 |
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Property Tax |
Total Revenue |
| 1. |
Bommanahalli |
67.50 |
31.48 |
| 2. |
Byatarayanapura |
125.80 |
7.01 |
| 3. |
Dasarahalli |
133.79 |
-40.55 |
| 4. |
K.R. Puram |
295.30 |
28.16 |
| 5. |
Mahadevpura |
100.90 |
1.99 |
| 6. |
R.R. Nagar |
146.10 |
26.24 |
| 7. |
Yelahanka |
148.32 |
-20.68 |
Table 2: Property tax and total revenue figures (in lakhs of rupees) for three north Karnataka centers from 2001-03 to 2004-05
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Nippani |
Karwar |
Gokak |
| Property tax |
| 2001-02 |
35.45 |
74.49 |
29.11 |
| 2002-03 |
9.19 |
75.51 |
2.51 |
| 2003-04 |
69.84 |
63.63 |
62.44 |
| 2004-05 |
43.08 |
52.30 |
50.13 |
| Total Revenue |
| 2001-02 |
498.09 |
414.04 |
342.05 |
| 2002-03 |
347.18 |
301.58 |
366.04 |
| 2003-04 |
409.70 |
260.39 |
321.26 |
| 2004-05 |
338.36 |
304.93 |
362.40 |
| 2001-02 |
498.09 |
414.04 |
342.05 |
Tables 1 and 2 show the impact of major municipal property tax reforms on two kinds of centers in Karnataka. While the peri-Bangalore centers showed a large rise in property tax collections, the impact on the north Karnataka cities is extremely uneven, with all three showing signs of declining tax revenues as time goes by. The most interesting impact, however, is seen on the total revenue situation of all these centers. They have all, at best, stagnated. Many have seen a consistent fall.
What does this mean? The major sources of revenue apart of property tax are those devolved by the State. The State Finance Commission set up as per the guidelines of the 74th formulates a way of devolving State revenues to Local Governments, both panchayats and municipalities. These, together with duties on sale of land and a few other minor taxes collected by the State Government on behalf of the municipality are devolved every year. Apart from this the State Government also gives grants for various specific activities that the municipalities are meant to carry out, such as building housing for the poor, sanitation in slums, and related capital works. This is where large chunks of revenues for the municipalities come from. In fact, only about 40% of the revenue of a municipality comes from its own resources, the rest 60% comes from the State Government grants. So revenue stabilization is largely dependent on how consistently and what measure the State devolves and grants funds to municipalities. The tables point to the nature of the financial and governance relationship between municipalities and the State Government. The absolute dependency of the municipalities on State devolutions and grants, even after accepting large scale property tax reforms - that did not benefit all centers to the same degree - is demonstrated by them.
The 'Disempowered' Municipality
Let us now look at the implications of this unstable financial situation to the municipalities in terms of the functions they are supposed to carry out. Planning for economic development and social justice is most likely to be adversely affected since all planning requires that sources of revenue be stable and highly predictable over reasonable periods of time. In fact, all planning, such as putting in place city-wide underground drainage systems and roads, are jeopardized for the same reason. The best that the municipalities can do is to take care of the day-to-day providing of basic services and making small incremental additions that are short term in nature. Nothing long term can even be envisaged. In any event, the total revenue of the municipalities as of date is by no means sufficient to even think about putting into place plans for infrastructure development that also foster economic growth. This means that the municipality must look to the State to help it to raise the necessary resources.
It is in this arena that the inherently weak political position of the municipalities comes into focus. The newly created (technologically savvy) arms of the State Government mentioned earlier also come into play in the negotiation between the municipality and the State Government on how the State Government must mobilize the required resources, and then on what institutional mechanisms must be put into place to maintain the ‘self-governing’ and democratic nature of the centers that accept these resources.
Do urban centers have the required nature of political representation to carry this entire process forward on terms that have them acting as equal partners with the State Government? This dilemma underpins the general sense of urban neglect that besets urban centers across India. The electorate in urban areas has still not caught up with the completely changed requirements of skills that their representatives must have in order to govern effectively. Unlike in the old days of the 70’s, the ‘technological distance’ between the skills of the average municipal councilor and those required to understand the processes of urban planning is now vast. Since the State Government is always going to be a major player in resource mobilization, it also going to attempt to set terms on how the resources are used. To counter the State Government in this matter to gain equitable terms, the elected representative in the municipality is going to have to gather technical and intellectual resources that at present no elected body in India really mobilizes for its own purposes.
So the very nature of representation itself is going to have to change drastically. This will have to have two parts to it. A clear understanding of the constitutionally mandated functions of the municipality, and that they go far beyond merely fixing street lights and collecting garbage once in a while. Urban planning and growth are functions that must be finally rooted in the institution of the municipality for it to work effectively. To lay claim to these functions in the arena of political representation is going to be a matter of how quickly and well councilors understand the need to mobilize human resources providing them with the skills to negotiate terms with the State Government. This in turn could determine whether urban centers grow or stagnate.
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| Sharadini Rath is one of the editors of Phalanx |
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The author raises many crucial questions about the power of local self-governments in urban centers which can also be extended to other areas. The capacity for self-government is restricted to the ability to plan expenditure and this is dependent on the access to ‘untied’ funds, i.e. finances not earmarked for a specific purpose. It is apparent that only finances raised locally through taxes will be genuinely untied because finances devolved by a higher level of government cannot be used to meet expenses determined and planned for locally by an elected body. An even more important issue involves the knowledge gap between the executive and the elected representatives. With the ‘technological distance’ between the executive and the elected body becoming larger, there is also the danger of power becoming informally concentrated in hands not accountable to the public. With the executive becoming more savvy technologically than the elected body, is not the threat of democracy becoming only nominal getting larger each day?
Editor |
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