Federal System of Governance and International Practice on Concurrent Power in Nepal

1. Federal System of Governance andInternational Practice on Concurrent Power (The Prospects and Challenges of Federalism in Nepal) Presentation on Supreme Court Bar Association 8 June 2018, Friday Dr.ChandraKantaGyawali, (Senior Advocate,Supreme Court of Nepal Phd. in Constitutional Law)

2. Thematic Concept • Federalism :Re-structuring of the State and • International Practice on Concurrent Power • Theory and Power Sharing Model in the World • Structure of State and Distribution of State Power • Structure of State • Distribution of State Power • Exercise of Financial powers • Distribution of Sources of Revenue Inclusive Representation • Concept of Inclusive Representation • Inclusive Representation under the constitution of Nepal • Election Result ,2017/18 • Exercise of inclusive representation in the process of Federalization

3. Federalism • Federalism is as distribution of powers and responsibilities. • It presents an objective, balanced, description, analysis of the distribution of powers and responsibilities in the federal Constitution and practice in 27 countries . • (Spain , South Africa and Ethiopia unitary to federal) • . For each federation there is an in -depth examination of such themes as (1) the distribution of governmental , political, monetary, fiscal, administrative, and policy responsibilities;

4. Cont… (2) Symmetry and asymmetry in the distribution of responsibilities; (3) The reasons and ways in which powers and responsibilities are explicitly and implicitly exclusive, concurrent, or shared in the constitution; (4) The reasons and ways in which responsibilities become divided and shared in actual governmental practice; (5) Current controversies over the division and or sharing of powers and responsibilities; and (6) Assessments of the executive and concurrent exercise of powers and responsibilities.

5. Cont… • Federalism is also seen as method of good governance in which political accommodation. • It is conflicting ideologies, disparate groups and seemingly irreconcilable positions. • The federal system is a device of shared governance, and the constitutions of federal polities "creative balance" • It is between the need for an effective federal centre and the need for effectively empowered constituent federal units.

6. Cont… • There is also need to balance the factors promoting a federal – institutional model of self – rule with those promoting shared rule. • Federalism is not always best, and there is no best version of federalism. • Federalism seems particularly suited to democracies with very large populations or territories or with highly diverse populations that are regionally concentrated. • Over time, federalism requires a significant part of the population to have a sense of identity with the whole country, as well lively and engaged political communities at the regional levels.

7. Model Of Federal System • Full federal System • Semi or Quasi -federal system • Central government enjoys maximum power than state power: Canada and India • Centralized and Peripheral federal system(USA) • (Centralized is very strong and state remain weaker) • Formal and effective federal system • (Pakistan, Nigeria, Mexico and Sudan) • Permissive federal system • (Australia, Malaysia and Russian federation) • Cooperative federal system • (Germany, South Africa, India and Canada)

8. Cont… • Competitive Federal System • (Belgium, Brazil, Australia and Switzerland) • Planned or majority Federal System • (Russian Federation) • Asymmetric and Symmetric Federal System • (Unequal distribution of power , art 370-71 in Indian contituion make special provision for the state of Jammu and kasmir , Andra pradesh, Arunachal pradesh, Assam , Goa,Mizoram, Manipur Nagaland, and Sikim and Equal power or same power can use all state in USA

9. Cont… • Cooperative Federalism • (Share power and responsibility equally and either three or two tires of governments are partners in exercise of governmental authority.) • Fiscal Federalism (Financial relationship between different level of governments) Creative Federalism ( All governments are involves common planning but it is replaced by cooperative federalism)

10. Classification based on mode of creation of the federation • Coming Together and Holding Together • One Identity and Much Identity • Born and Became Federation

11. Theory of Division Power • Dualist Power • Inter -locking Power • Enumerated Power • Residuary Power • Subsidiary Power

12. International Practice on Concurrent Power • Concurrent powers in USA are powers in nations with a federal system of government that are shared by both the federal government and each constituent political unit such as a state or province . • These powers may be exercised simultaneously within the same territory, in relation to the same body of citizens, and regarding the same subject-matter.

13. Cont.. • Concurrent powers are contrasted with reserved powers and exclusive federal powers . • Federal law is supreme, and therefore it may preempt to a state or provincial law in case of conflict. • Concurrent powers can therefore be divided into two kinds: those not generally subject to federal preemption (like the power to tax private citizens); and, other concurrent powers.

14. Cont… • Concurrent powers refer to political powers that are shared by both the state and federal governments. • A number of powers are given to the federal government by th • e U.S. Constitution, without barring those same powers to each individual state. • Such powers as establishing a court system, taxation, and regulating elections are common examples of concurrent powers of federal and state government.

15. Cont… • Concurrent powers provide for the needs at each level of government in order to keep people safe, deter criminal activities, support the economy, and prevent and punish criminal behavior. • Political or legislative powers, exercised independently or simultaneously, by both federal and state governments.

16. Cont… • Concurrent powers are powers enjoyed by both the state and federal government. • These powers may be exercised simultaneously, in the same area, and among the same group of citizens. • For instance, residents of most states are required to pay both federal and state taxes. This is because taxation is a subject of concurrent powers.

17. Cont… • In the event there is a conflict of powers held concurrently by the state and federal government, federal law and powers supersede state law and powers. • The point of concurrent powers is that there are many actions necessary to governmental operation at both the state and federal level. • These include such services as maintenance and operation of the government itself, maintaining public facilities and roads, and maintaining fire departments and law enforcement.

18. Cont… • These things cost money, and this is the reason for taxation. • While some people feel it is unfair or unconstitutional to essentially be taxed twice, concurrent powers afforded by the Constitution enables each governmental body providing such services to collect taxes from the citizens within the jurisdiction.

19. SCHEDULE 4 - FUNCTIONAL AREAS OF CONCURRENT NATIONAL AND PROVINCIAL LEGISLATIVE COMPETENCE in South Africa • Administration of indigenous forests  • Agriculture  • Airports other than international and national airports  • Animal control and diseases  • Casinos, racing, gambling and wagering, excluding • lotteries and sports pools  • Consumer protection 

20. Cont… • Cultural matters  • Disaster management  • Education at all levels, excluding tertiary education  • Environment  • Health services  • Housing  • Indigenous law and customary law.

21. Concurrent Power in India • The Concurrent List or List-III(Seventh Schedule) is a list of 52 items (though the last item is numbered 47) given in the Seventh Schedule  to the Constitution of India. • It includes the power to be considered by both the central and state government. • The legislative section is divided into three lists: Union List, State List and Concurrent List.

22. Cont… • Unlike the federal governments of the United States, Switzerland or Australia, residual powers remain with the Union Government, as with the Canadian federal government. • Uniformity is desirable but not essential on items in the concurrent list. •  If any provision of a law made by the Legislature of a State is repugnant to any provision of a law made by parliament which Parliament is competent to enact,

23. Cont… • To any provision of an existing law with respect to one of the matters enumerated in the Concurrent List, • Then, the law made by Parliament, whether passed before or after the law made by the Legislature of such State, • or, as the case may be, the existing law, shall prevail and the law made by the Legislature of the State shall, to the extent of the repugnancy, be void

24. Concurrent List in India • The 52 items currently on the list are: • 1. Criminal law, including all matters included in the Indian Penal Code  naval, military or air forces or any other armed forces of the Union in aid of the civil power. • 2. Criminal procedure, including all matters included in the Code of Criminal Procedure at the commencement of this constitution.

25. Cont… • 3. Preventive detention, for reasons connected with the security of a State, the maintenance of public order, or the maintenance of supplies and services essential to the community; persons subjected to such detention. • 4. Removal from one State to another State of prisoners, accused persons and persons subjected to preventive detention for reasons specified in Entry 3 of this list. .

26. Cont… • 5. Marriage and divorce, infants and minors, adoption, wills, intestacy and succession

27. How do you analyze state Restructuring? Concept of Restructuring of the State of Nepal • It may be fair to say that the discourse on state restructuring in Nepal is focused on two perspectives or models: • One is the ethnic perspective, and • The other is what might be called the socio-economic development perspective.

28. Cont… • The ethnic model advocates for the formation of states or provinces covering territories historically inhabited by some major ethnic communities. • History is the starting point. The argument is that it is the lack of recognition of territorial ethnic identities, their language, traditions, culture and aspirations that has resulted in the rise of a partisan state, • where Hindu caste groups such as the Chhetris and Bahuns have exercised the monopoly of power and received the open patronage of the state. 

29. Cont… • Exercised the monopoly of power and received the open patronage of the state. I believe that federalization is just a means to an end. The end is the creation of a prosperous Nepal where prosperity is shared by all irrespective of ethnicity, caste or class. • The rational for federalism in Nepal has to rest on three premises. The first is the recognition of the ethnic, linguistic, cultural and regional identity and aspirations of the diverse population groups that inhabit Nepal. • Shared ownership of the state requires that progressive ethnic, cultural and regional identities are given due recognition.

30. Structure of State and distribution of State Power • Structure of State: • The main structure of the Federal Democratic Republic of Nepal shall be of three levels, • Namely: • The Federation, • The State and • The Local level. • The Federation, State and Local levels shall exercise the power of State of Nepal pursuant to this Constitution and law.

31. States and Village and Municipalities • There shall be States consisting of the Districts as mentioned in Schedule-4 existing in Nepal at the time of commencement of this Constitution. • There shall be Village Bodies, Municipalities and District Assemblies under the Local level. • Any Special, Protected or Autonomous Region can be set by the Federal law for social, cultural protection or economic development.

32. Cont… • The Federation, State and Local levels shall protect Nepal's freedom, • sovereignty, territorial integrity, independence, • national interest, • overall development, • multi-party, competitive, • democratic, republican,

33. Cont… • Federal system of governance, • Human rights and • Fundamental rights, • Rule of law, separation of powers and • Check and balance, • Egalitarian society based on pluralism and equality, inclusive representation and identity.

34. Distribution of State power: • The powers of the Federation shall be vested in the matters • Enumerated in Schedule-5, and • Such powers shall be exercised pursuant to this Constitution and the Federal law. • The powers of a State shall be vested in the matters enumerated in Schedule-6, and

35. Cont… • The powers shall be exercised pursuant to this Constitution and the State law. • The concurrent powers of the Federation and the State shall be vested in the matters enumerated in Schedule-7, and • Such powers shall be exercised pursuant to this Constitution, the Federal law and the State law.

36. Cont… • The powers of the Local level shall be vested in the matters enumerated • in Schedule-8, and such powers shall be exercised pursuant to this Constitution and the law made by the Village Assembly or Municipal Assembly. • The concurrent powers of the Federation, State and Local levels shall be vested in the matters enumerated in Schedule-9, and

37. Cont… • Such Powers shall be exercised pursuant to this Constitution, the Federal law, • The State law and the law made by the Village Assembly or Municipal Assembly. • Any law to be made by the State Assembly, Village Assembly or Municipal Assembly shall be so made as not to be inconsistent with the Federal law, and • Any law made by the State Assembly, Village Assembly or Municipal Assembly which is inconsistent with the Federal law

38. Exercise of Financial Powers • The Federation, State and Local level shall make laws, • Make annual budget, • Decisions, • Formulate and implement policies and • Plans on any matters related to financial powers • Within their respective jurisdictions.

39. Cont… • The Federation may so make necessary policies, • Standards and laws on any of the matters enumerated in the Concurrent List and • Other areas of financial powers as to be applicable also to the States. • The Federation, State and Local level shall make budget of their respective levels, and the time for submission of budget by the State

40. Cont… • Local level shall be as provided for in the Federal law. • The Federation, State and Local level shall provide for the equitable distribution of benefits derived from the use of natural resources or development. • Certain portions of such benefits shall be distributed, pursuant to law, in forms of royalty, services or goods to the project affected regions and local communities. • Federation, State and Local level shall be as provided for in the Federal law. • 60. Distribution of sources

41. Cont… • If, in utilizing natural resources, the local community desires to make investment therein, • The Federation, State and Local level shall accord priority to such investment in such portion as provided by law on the basis of the nature and size of such investment. • The Government of Nepal shall have power to obtain foreign assistance and borrow loans. Such assistance or loans shall be so obtained or borrowed as to have macro-economic stability of the country.

42. Distribution of sources of revenue: • The Federation, State and Local level may impose taxes on matters falling within their respective jurisdiction and collect revenue from these sources. • Provided that provisions relating to the imposition of taxes and collection of revenue on matters that fall within the Concurrent List and on matters that are not included in the List of any level shall be as determined by the Government of Nepal.

43. Cont… • The Government of Nepal shall make provisions for the equitable distribution of the collected revenue to the Federation, State and Local level. • The amount of fiscal transfer receivable by the State and Local level shall be as recommended by the National Natural Resources and Fiscal Commission. • The Government of Nepal shall, on the basis of the need of expenditure and revenue

44. Cont… • Capacity, distribute fiscal equalization grants to the State and Local level. • Each State shall, in accordance with the State law, distribute fiscal equalization grants out of the grants received from the Government of Nepal and revenues collected from its sources, on the basis of the need of expenditure and revenue capacity of its subordinate Local level.

45. Cont… • Provisions relating to distribution of conditional grants, complementary grants or special grants for other purposes to be provided by the Government of Nepal from the Federal Consolidated Fund shall be as provided for in the Federal law.

46. Proportional Inclusion in The State Organs in Process of Federalization in Nepal • First Constituent Assembly: The First Constituent Assembly (CA) in Nepal was dissolved without promulgating the new constitution in 2012, • But the second CA successfully promulgated the Constitution of Nepal on 20 September, 2015. • Nepal, for the first time, as a federation is divided into 1 Federal Gov., 7 States and 753 Local Units.

47. Vertical and Horizontal Division of Power • Vertical division of power through three tier of Parliaments and governments as federal, state and local level with the constitution. • Itself formulating structural framework and defining sources of power. • Horizontal separation of powers at each level of government and concept of shared -rule and self- rule are not easy to incorporate in a simple way.

48. Federal legislature • Federal legislature is bicameral. • House of Representatives shall consist 275 members. • (FPTP) 165 election constituencies on the basis of population and geography. • Proportional 110, country being considered as single electoral constituency ensuring just, and inclusive) • National Assembly shall consist of fifty nine members

49. Cont… • 56 by an electoral college including at least 3 Women, 1 Dalit, 1 from persons with Disabilities or Minorities from each state • 3 members consisting of at least one Woman. • Fifty six members elected from an Electoral College comprising members of Provincial Assembly and local level. • Including at least three women, one dalit, one person with disability or minority(21 women,7dalits,7 disability and others 21 =56) • Three members, including at least one woman, to be nominated by the President.

50. Mixed Electoral System • Mixed Electoral System (FPTP in 60 % and PR 40 %) at federal and state level legislature. Inclusive FPTP Electoral System in Executive or village Assembly or Municipal Assembly.