74 th Constitution Amendment Act 1992 (Part IX A Of the Constitution)

1. 74th Constitution Amendment Act 1992 (Part IX A Of the Constitution) Prof H M Mishra, Ph.D Sr. Consultant (CUG), AIGGPA, Bhopal

2. Urban Governance : Components and Dynamics • Higher dynamism and rapid changes • City=f(citizen, environment, processes) • Citizen – number, relationships, attitudes, needs, aspirations, language, etc. • Environment – physical and natural (water, air, buildings, pollution, etc. • Processes – governance mechanism, livelihood, legal framework, etc.

3. CONSTITUTION (seventy-fourth) AMENDMENT ACT • On enactment, 74th was seen as a watershed in decentralization and the harbinger of self-governance • Till date has been the most concerted attempt at creating local institutions of self-governance • Can be credited with considerable achievements in furthering democratic participation, social and gender equity, and probity and fair play in municipal elections • Fell far short of the objectives of real decentralization • Turning point for decentralization where decentralization failed to turn

4. CONSTITUTION (seventy-fourth) AMENDMENT ACT • Provisions about CONSTITUTION, COMPOSITION and DURATION of ULBs • Provisions about ELECTIONS and QUALIFICATIONS of members • Provisions about SOCIALandGENDER EQUITY • Provisions about theFUNCTIONAL DOMAIN of ULBs • Provisions about the FINANCIAL HEALTH of ULBs • Provisions about PLANNING aspects of ULBs

5. PROVISIONS OF AMENDMENT ACT • 243 Q CONSTITUTION • 243 R COMPOSITION • 243 S WARDS COMMITTEES • 243 T RESERVATIONS • 243 U DURATION • 243 V DISQUALIFICATION • 243 ZA STATE ELECTION COM

6. PROVISIONS OF AMENDMENT ACT • 243 W FUNCTIONS • 243 ZG SCHEDULE 12 • 243 X FINANCES • 243 Y FINANCE COMMISSION • 243 Z AUDIT OF ACCOUNTS • 243 ZD DPC • 243 ZE MPC • 243 ZF CONFORMITY LEG

7. CONFORMITY LEGISLATION • Some changes were made mandatory, others allowed discretion to States • In general, even for mandatory provisions, States dragged their feet • Where there was discretion, little space was provided to the spirit of the 74th • Discretions ended up in diverse interpretations and bewildering diversity

8. CONSTITUTION • 74th indicated population, density, revenue, non-agricultural activities as primary criteria for classification of Corp, Councils and Nagar Panchayats • Widest possible variations in such classification • Resistance to municipalization

9. COMPOSITION • Wide variation in the composition of wards • No accepted definition of knowledge and experience • Wide variations in the manner of elections of Mayors, Chairpersons, term of office and representation to MPs/MLAs • Similar variations in their removal • Domination of political expediency at the cost of good governance

10. FUNCTIONS and FINANCE • The Legislature of a State may, by law, endow Municipalities with such powers and authority as necessary to enable them to function as institutions of self-government and may contain provisions for the devolution of powers and responsibilities upon Municipalities …….. including those in relation to matters listed in the Twelfth Schedule • The Legislature of a State may, by law, authorize the Municipalities to levy, collect and appropriate such taxes, duties, tolls and fees, to assign to a Municipality such taxes, duties, tolls and fees levied and collectedby the State Government, to provide for making suchgrants-in-aid to Municipalities from Consolidated Fund of the State • The Finance Commission shall review and recommend principles for the above in order to improvethefinancial position and in the interests ofsound finance of the Municipalities • The State Legislature may, by law, provide for the maintenance of accounts by the Municipalities and the auditing of such accounts

11. FUNCTIONS • Wide variations in functions allocated to ULBs • Scant consideration in such allocation to the administrative capacity of ULBs • Continuation of many parastatals • Little improvement in the functional domain of ULBs as a consequence of the 74th Amendment

12. FINANCIAL DOMAIN • Left financial domain of the ULBs to the discretion of the States • No independent tax domain for the ULBs • Huge mismatch in their functions and finances • Recommendations of SFCs very sketchily complied with • AICMin court against States

13. PLANNING COMMITTEES • Enabling Acts put in place for the constitution of DPCs and MPCs by States • Few have actually constituted these Committees themselves • In general, State functionaries continue to dominate the Committees rather than ZPs • Massive confusion about the geographical jurisdictions of DPCs and MPCs • Planning Authorities continue to exist

14. DESIRABLE LEGISLATIVE CHANGES FOR THE FUTURE • Treat the 74th as a small beginning, not the ultimate in decentralization • Based on this decadal assessment, move towards a further generation of reforms • The overall objectives of decentralization – education (in running local democracy), empowerment (through democratic participation), efficiency (through informed local decision-making) and enrichment (through greater productivity) must drive all further reform • In the final analysis, all reform must strive to satisfy the norms of good urban governance

15. SPECIFIC LEGISLATIVE CHANGES • Mandated functional domain of ULBs • Mandated financial domain of ULBs • Some minimal uniformity in constitution andcomposition • Greater stability of ULB leadership • Primacyof local representatives in DPCs/MPCs be established

16. URBAN SECTOR REFORMS: ROAD AHEAD • The IndianURBAN AGENDA is fundamentally a STATE AGENDA • STATE URBAN SECTOR REFORMS will overwhelmingly impact CITY GOVERNANCE • The ROAD MAP for such reforms has already been set by the CONSTITUTION (SEVENTY-FOURTH) AMENDMENT ACT 1992 • STATE URBAN SECTOR REFORMS must, therefore, be in consonance with both the provisions and the SPIRIT of the CONSTITUTION • STATE REFORMS need customization to satisfactorily address the needs of NAGAR PANCHAYATS, MUN COUNCILS and MUN CORPORATIONS

17. KEY STATE REFORMS • LEGISLATION of a MUNICIPAL LAW that moves the STATE from its present primary role of REGULATOR to that of an ENABLER of INSTITUTIONS of SELF-GOVERNMENT. REPEAL of LAWSthat contravenethis spirit. • STATE engages primarily in laying down overall URBANPOLICY, urban STRATEGIES for implementing policy, with an overriding concern for EQUITABLE GROWTH of cities as far as possible through DISTRIBUTION OF GROWTH and opportunities of WEALTH CREATION • STATEsets the benchmarks forGOOD URBAN GOVERNACE and providesINCENTIVESto cities thatINNOVATEforGOOD MUNICIPAL MANAGEMENT in line withGoI INITIATIVES

18. KEY STATE REFORMS FUNCTIONAL • Determine functionsof ULBs in the light of their capacities. Logically Nagar Panchayats would perform fewer functions, Municipal Councils a larger number and Municipal Corporations many more • Determine legislative changes/administrative powers that would allow ULBs perform those functions • Amend laws/devolve decision-making authority on ULBs in line with those functions • Such decentralization, in the spirit of the Constitution, should go as far as making ULBs institutions of self government

19. KEY STATE REFORMS FINANCIAL • MatchFUNCTIONSofULBswithFINANCES • Determine instrumentsofFINANCE: taxes, fees, tolls, land-based instruments, outsourcing, private sector participation • Amend laws to allowinitiativesin these areas by ULBs • Set up State level financial intermediary to assist ULBs, especially the weaker ones, in pooling finance and in project formulation • Set the tone foraccounting reforms across all ULBs and assist them to get themselves credit rated

20. KEY STATE REFORMSGOOD URBAN GOVERNANCE • URBAN DECENTRALIZATION • MUNICIPAL FINANCE • URBAN EMVIRONMENT • INTEGRATION OF URBAN POVERTY • TRANSPARENCY & CIVIC ENGAGEMENT • MUNICIPAL MANAGEMENT & CAPACITY BUILDING

21. Thank you