The best thing the BJP coalition has done in its first 150 days in office is appoint A.M. Khusro as chairman of the Eleventh Finance Commission. Khusro is an outstanding agricultural economist. He has an understanding of, and a sympathy for, rural India which few intellectuals and fewer still of our middle classes have.Hitherto, most finance commissions have been primarily concerned with how to let states get a fair share of the national pie without the Centre cornering everything. That is a noble objective in itself. But none has asked itself the question: does the share secured by the states go to the intended beneficiaries or does it get diverted to other uses?I suspect the answer Khusro will come up with will be: while a substantial share of what is earmarked for propping up the welfare of urban India does in fact get spent to some extent as it should rural India gets a really raw deal. The money is not spent. When it is spent, it is misspent.The primary reason for this is while certain sections of urban India-the relatively well-off- have organised themselves through pressure groups or nepotistic networking to get something for themselves, the vast rural population is much less organised to access its entitlements.Part IX of the Constitution, incorporating the amendments for the panchayats and nagarpalikas, has attempted to rectify this injustice by beginning a process of empowering elected representatives at the grassroots.The most encouraging feature of the new Finance Commission is not just that it slots the right man into the right niche but that it specifically mandates the commission to study in detail the "sound finances" of the local bodies, to quote from the Constitution. Moreover, this is to be done not merely as a way of throwing a few crumbs to the panchayats and municipalities but in the light of the totality of the provisions of Part IX.In the five years since we got Part IX, elected local bodies sanctioned and guaranteed by the Constitution have come up in almost all states of the country (the main exception being that republic of darkness, Bihar). Whereas earlier about 5,000 MPs and MLAs were all we had to represent close on 1,000 million people, the local bodies' elections have raised the figure to an impressive 30 lakh, of which 10 lakh are women.They cannot be dismissed nor their institutions dissolved without by-elections being held within six months. Nor can they be held in abeyance for decades, as had been happening earlier. We have been the world's largest democracy. We are now also the world's most representative democracy.Or should be. The problem is the state governments have by and large adhered to the letter of the Constitution in establishing the panchayats and nagarpalikas. Yet, they have denied these bodies responsibilities, authority, staff of their own, and, most important, finances.Thousands of crores of rupees earmarked for subjects that the Constitution and state laws have allocated to the panchayats or nagarpalikas have either been swallowed by state governments or entrusted to bureaucrats, not elected representatives, to spend.Khusro and his commission will be rescuing panchayati raj from this perversion of its purpose. Rural development and, above all, the safety net for the poorest of the poor (some one-third of our population) has been grossly inadequate primarily because the bureaucratised delivery of development to the grassroots has failed. The precondition for a boom in the rural economy is democracy at the grassroots. That involves the people in their own development and welfare.It ends the bane of the maai-baap sarkar that has retarded India's growth. And it takes us back to Mahatma Gandhi's vision ("No purna swarajya without gram swarajya"). Ignoring his insistence on making village panchayats the basis of our democracy was the biggest error of those who drafted and negotiated the Constitution. That error now stands rectified.The devolution of finances should, logically, flow from the decentralisation of responsibilities. But precisely because decentralisation has been insincere, the flow of money has been staunched by the various state governments.Khusro can make a revolutionary contribution to the sound finances of the panchayats and nagarpalikas. He can order (for the Central Finance Commission can order, the state finance commissions can only recommend) that all Central funds for subjects listed in the 11th and 12th schedules of the Constitution-which now stand decentralised by the highest law in the land to the third tier of governance be directly paid into the bank accounts of the elected local bodies.A conservative estimate puts the sum at over Rs 5,000 crore per annum. Depending upon the interpretation Khusro gives to the import of the schedules, the sum could rise to twice that figure, perhaps higher.Once funds are available to the panchayats, then, in a reversal of logic but in keeping with political realities, the decentralisation of powers will follow the devolution of funds. Only then will India blossom in the 21st century.The author is secretary, AICC. The views expressed here are his own. Published By: AtMigration Published On: Jun 10, 1998--- ENDS ---
