Local Democracy and Development: The Kerala People's Campaign for Decentralized Planning by T.M. Thomas Isaac & Richard W. Franke

Author:T.M. Thomas Isaac & Richard W. Franke [Isaac, T.M. Thomas & Franke, Richard W.]
Language: eng
Format: epub
Publisher: Leftword Books
Published: 2017-09-09T00:00:00+00:00

Municipalities

4212

38.33

16.29

3.26

3.29

1.00

14.55

5.35

15.19

2.73

100.00

Corporation

888

34.77

10.28

6.30

1.03

1.15

22.07

4.85

15.94

3.61

100.00

Total

67766

43.54

5.84

4.10

6.82

1.57

10.58

3.90

20.58

3.06

100.00

Source Consolidated from Annexure Forms 1997–98.

The effort made by the local bodies to go beyond the state grant was remarkable. The non-plan surplus from their own funds, voluntary labour and donations together came to around a quarter of the grant-in-aid given by the state government (columns 4 + 9 as a per cent of column 3). A significant proportion of beneficiary contribution, particularly in drinking water and road projects, could also be counted as additional resource mobilization.

Column 4 of Table 9.1 gives the share of internal resources mobilized by the bodies. Urban municipalities and corporations had a higher percentage of the plan outlay from their own revenues because of their superior financial position compared to the rural local bodies in Kerala. The block and district panchayats, with no taxation, could hardly raise any internal resources for the plan. Columns 5 and 6 of Table 9.1 present the contributions from state and centrally-sponsored schemes. The expected revenues from state-sponsored schemes are only 4.10 per cent of the outlay or 9.52 per cent of the state grant-in-aid. There is an obvious underestimation of this source of plan finance. The amount set apart for the state-sponsored schemes in the state budget was Rs 2,764 million as against the grant-in-aid Rs 7,490 million. Therefore, on average, local bodies could reasonably expect an amount equal to one-third of the grant-in-aid from the state-sponsored schemes. However, for the grama panchayats the reported revenue from this source is only 3.24 per cent of the outlay. This reflects lack of clarity regarding the probable share that a local body could expect from such schemes while preparing their plans. Similarly the centrally-sponsored schemes contribute only 1.03 per cent to the municipal corporations and 1.84 per cent to the district panchayats, 2.39 per cent to the grama panchayats and 3.29 per cent to the municipalities. In the block panchayats the share is 28.7 per cent. The data indicate that the failure to integrate the central and state schemes into the local plans was a major accounting weakness of the annual plans for 1997–98.

Another major hitch was the non-cooperation of the commercial banks with the People’s Campaign. They were unwilling to permit two or three bank officers for every block to serve in the expert committees. The financial contribution of the cooperative sector is only a sixth of the expected share from the commercial banks. The cooperative credit system plays a much larger role than the commercial banks in financing the agricultural and small-scale productive sectors in Kerala. There was not sufficient effort during the campaign’s first year to coordinate the cooperative movement with local planning.

At the grassroots level, local bodies attempted to tap larger resources through voluntary labour and donations than did the higher-level bodies. The same pattern applies for the contribution from the beneficiaries. Accounting of beneficiary contributions is prone to exaggeration although it was repeatedly explained that only complementary additional investment undertaken by the beneficiary could be included.

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