The Role of Local Government in Shaping Democracy – 74th Constitutional Amendment

“Urban Local Government” signifies the mechanism by which the urban population exercises governance over a specified urban area, subject to the state government’s delineation. Ultimately, democracy means that power should be shared by the people; people in the villages and urban localities must have the power to decide what policies and programmes they want to adopt. 

The 74th Constitutional Amendment Act: An Overview

• Amendment of The Constitution: The 74th Constitutional Amendment Act, 1992 came into effect on 1 June 1993, introduced Part IX A (the Municipalities) which deals with the issues relating to municipalities. 
• Urban Local Bodies: The Act provided constitutional status to the Urban Local Bodies (ULBs).
• State Legislatures’ Authority: Article 243W of the 74th Constitutional Amendment authorized the State Legislatures to enact laws to endow local bodies with powers and authority as necessary to enable them to function as institutions of Self-Government
  •  It also makes provisions for devolution of powers and Responsibilities.
• 12th Schedule Functions: The 12th Schedule of the Constitution enumerates 18 specific functions to be devolved to ULBs

What is the Significance of the 74th Constitutional Amendment for Urban Governance?

• Urban Population: As per the 2011 Census, about 31% of India’s population lives in urban areas, hence the importance of the 74th Amendment Act increased multifold. 
  • In many ways, the 74th Constitutional Amendment is a repetition of the 73rd Amendment, except that it applies to urban areas. 
• Transfer of Functions: The Constitution also mandated the transfer of a list of functions from the State government to the urban local bodies. 
  • These functions have been listed in the Twelfth Schedule of the Constitution.

Positive and Negative Outcomes of the 73rd and 74th Constitutional Amendments: Did They Truly Empower Local Bodies?

Empowering Local Governance: Positive Outcomes of the 73rd and 74th Amendments in India

• State Implementation: All States have now passed legislation to implement the provisions of the 73rd and 74th Amendments. 

• Uniform Structures: The 73rd and 74th amendments have created uniformity in the structures of Panchayati Raj and Nagarpalika institutions across the country. 

• Reservations for Women: The provision for reservation for women at the Panchayats and Nagarpalikas has brought a new perspective and a greater sensitivity to discussions at local bodies.

Downsides of Local Governance: Reservations, Limited Empowerment, and Financial Dependency

• Reservations and Representation: Reservations for Scheduled Castes and Tribes, Backward classes have made local bodies more representative of the social reality they operate within, sometimes leading to tensions.
• Limited Subject Transfer: Many States have not transferred most of the subjects to the local bodies, making the local bodies toothless.
• Financial Dependence: The dependence of local bodies on the State and central governments for financial support has greatly eroded their capacity to operate effectively. 
• Revenue Generation: While rural local bodies raise 0.24% of the total revenues collected, they account for 4% of the total expenditure made by the government. 
  • So, they earn much less than they spend. 
• Grant Dependency: That makes them dependent on those who give them grants.

Conclusion

• Local governments continue to be agencies implementing the welfare and development schemes of the Central and State government.
  • Giving more power to local governments means that we should be prepared for real decentralization of power.