Efforts for rural decentralization reforms have been undertaken before. What is special about the Government of Karnataka's 2002 Working Group effort? What is the malaise your government is trying to address?

I think this is part of a worldwide trend where we're looking at true decentralization. The problem with discussing decentralization is that it has such wide connotations and everybody has their own ideas about what this term actually means. But through international experiences, a lot of common components of decentralization are emerging. What can be said for evidence of decentralization?

  • It's not merely that you have money to spend, but that you have your own money to spend. It is increasingly becoming a part of decentralization that you rely on significant sources of local revenue which you can collect and spend.
  • You (the local govt) must have the power to hire, fire and select your personnel. On the other hand, if people work with you on deputation, this is merely an agency function for a higher tier of government.
  • There must be a direct accountability element, in the sense that if you do not deliver services that are clearly delineated as your services, then you should be accountable and punishable for that.

Now, sometimes in our hierarchical Panchayati Raj system, these pure components of decentralization are missing. For example - if you tested our Zilla Panchayats (ZP) and Taluka Panchayats (TP) against these international criteria of decentralization, they are more likely to be flagged as agencies of the state government, political agencies, but agencies nevertheless, rather than decentralized local self governments, whatever our protestations to the contrary may be.

Whereas gram panchayats, inspite of the fact that they only spend about 5% of the total devolutions from the state government, do meet some of these criteria. They have large amounts of discretion over the small amounts of money that they have and they are empowered to hire and fire. Karnataka has 30,000 appointed gram panchayat employees on the rolls, and they can be potentially fired by the gram panchayats. The panchayats are also have significant sources of revenue such as property taxes.

But have those revenue opportunities been tapped?

I wouldn't say they haven't. There are 265000 gram panchayats in India. We have 5659 in Karnataka which is about 2% of the country's total. Rs.528 crores is collected every year by way of property taxes from rural areas in the country. Karnataka collects Rs.60 crores. So we collect around 11% of the country's collections. So yes, per capita levels are low, but we add up pretty well compared to other states. 16% of gram panchayat expenditures in Karnataka are on average contributed to by their own revenue streams.

So the gram panchayat has the potential - it is the ugly duckling that can grow into a swan.

Many people tend to think of accountability for public institutions in a downward sense - that of people pressurizing institutions to work. And this is hard enough. If your ministry's goes by your recommendations, it will be introducing what seems like a new can of worms -- upward accountability for the panchayats. Aren't you adding a level of complexity to the baseline that is already not working?

No, I wouldn't say that, whatever the press may write about downward accountability. Downward accountability is a more romantic notion than upward accountability. We have been a hierarchical system, whether it's departmental hierarchy or panchayati raj hierarchy. Even though upward accountability systems don't really grab press attention, they do exist and have existed since a long time. This was in fact the basis of the Indian administration since the British system; a very strong system of upward accountability and strict hierarchy.

So that system has been in existence, it's not that one is trying to introduce a new system. But what one is trying to do, is being consistent to a matter of principle. The principle is that upward accountability systems have to independent of the government itself. Otherwise Panchayati Raj Institutions (PRI) would always be hand-maidens of the government. You cannot have a bureaucrat sitting in a chair exercising judgment over the actions of an elected body, as a matter of principle. So either you have another elected body doing that, which has its own political complications, or you setup up an independent body to do it. This is why we have suggested the institution of the ombudsman. Our recommendations were born out of obeisance to the principle that upward accountability mechanisms have to be independent of the government.
For more : Accountability in Panchayati Raj

How far down the road is Karnataka's Ministry of Rural Development with implementation of these reforms? Give us an idea of the challenges.

There about 8 to 10 very clear policy initiatives which have their direct birth in the reforms report. The most important of these are the suggested amendments to the Karnataka Panchayati Raj laws. The amendments suggested went to all party meetings for discussion, and they has been cleared by the state government. The draft legislation is now with the state legislature. Not everything recommended by the working group has been accepted, but a fair number have been, particularly the suggestions with respect to intensifying the gram sabha participation by the introduction of the Vasathi Sabha.

Now that this is before the state legislature, it is part of the political process. The legislature has to take it up, take a view on it, and pass the amendments to the Act, if they believe it is essential. This is one part of the policy initiatives towards reforms.
Update : Report in The Hindu, May 11, 2002.

There are two other very important policy initiatives. One is activity mapping. As I said, in decentralization you cannot enforce accountability unless there is a very clear delineation of functions. If functional responsibilities overlap, you can always hold somebody else accountable for your inactions. So activity mapping is an essential ingredient of decentralization. We don't require to change any law for this, but this initiative requires policy decisions and this is under consideration at the highest level of the state government right now.

The third aspect complementary to the legislative initiative and activity mapping, is the rationalization of schemes and the reduction of the huge number of heads of accounts to a much more smaller number. This initiative is also in an advanced stage. We've had discussions with various departments in the government and undertaken a consultative process with them. Their views and opinions on the proposed reforms have been sought; we hope that this will roll out soon.

Karnataka's Rural Development and Panchayat Raj Minister M Y Ghorpade recently refused to accede to the demand from MLAs of both ruling and opposition parties to give them a share in the funds of zilla panchayats.
Apart from these broad policy framework modifications -- one legislative and two significant administrative initiatives, which will define the emerging setup -- we are currently involved in a huge capacity building program. Our objective is to reach out to all 80,000 gram panchayat members in the state, and to the more than 10,000-15,000 gram panchayat employees who are directly concerned with assisting the PRIs in performing their functions. This year we are in the process of covering around 18,000 gram panchayat members through a very innovative satellite based training program. At every transmission of a lesson or session, the program touches about 2000 members. They can interact and speak to the panelists and we have local resource persons assisting the panchayat members at these sessions. So training is something that is going on. It also helps dispel the impression that people (at the grassroots) are not prepared for decentralization.

What sorts of training programs are these? Give us an example and what outcomes are fostered at these sessions that lead to the capacity building you are talking about?

The first thing is that capacity building is not training alone. I would classify capacity building into two categories. One is supply capacity building and the other is demand capacity building. Supply capacity building is something that the state should give everybody regardless of whether they are interested in it. This is something we should do as our obligations to ensure that the PRIs throw up competent representation. This is what we're engaged in now, we're undertaking training sessions for everybody.

This training basically revolves around a lot of audio-visual input such as films, discussions etc. Some of the films are pretty provocative, they are intended to be provocative to be so that we can have a lot of participation. There are some broad areas that we cover. These are the history of panchayati raj, a particular emphasis on the whole rationale behind reservations and women's issues in PR. A strong gender focus is the underlying theme behind all training programs, making women's issues very visible.

This phase has been completed. We've now taken up a second phase in which is basically about sectoral issues. We look at education, health, women and child welfare as one group. In March we plan to start a third phase of training which is on water supply and village sanitation.

After this, in the fourth phase we will look at accountability, social audits, citizens using the Right to Information Act, demanding information from the Panchayats, from the representatives, and so on. The final phase is the executive phase, where having sensitized people through these programs, our plan is to get them into a common mode, so that they prepare a village development plan. This is a planning process where all the enthusiasm and hope generated through the training programs results in the emergence of a village plan.

For the five phases of this program we are right now covering 44 taluks, reaching around 18,000 gram panchayat members as I mentioned earlier. For the next year (fiscal), funds permitting, we're hoping to cover the remaining 62000 gram panchayat members.

When do you see the village development plan part of your capacity building process actually taking shape?

For the 1330 gram panchayats we are currently involved in, the last phase of training will be in May 2003. It will end with the emergence of a development plan.

You talk of some radical things in your reforms report. Why do you say consensus is a dangerous thing for Panchayat level administrations? This is radical in the sense that it is coming from within the four walls of government!

I think we have got to look at the way Indian democracy functions. We do a lot of directed democracy. We believe that we need to have consensus, that consensus is a good thing. But consensus actually makes people not be committed on issues, and thereby they can avoid accountability. In many nascent democracies it has been found that tracking voting behaviour of the representatives is an excellent method of ensuring accountability. Members feel very uncomfortable with it, they would rather hide behind a consensus than be accountable for a decision.

I think we have got to deepen Indian democracy and make it conform to certain democratic principles. Dissent is not a wrong thing in a democracy. This is something that the our working group discussed. I know it goes against many traditionally held beliefs in India, but I think we're taking a step in the right direction.
For more : Democratising Panchayats

You say that there are scores of rural financing schemes at the Central government level that cause more problems than solve for the state governments. You have even said in public that these need to be wound up!

Budget allocations for Karnataka's panchayats increased
-The Hindu, Bangalore, April 3
Yes. I think its very important that the state government and central government when they speak of decentralization actually stick to the rules that they set for themselves. Decentralization cannot be achieved without destroying the prevailing hierarchies at some stage or other. Let's face it, you cannot decentralize in an area without questioning one's own relevance. Rural development is a state subject and yet you have a huge rural development ministry in the Govt of India at New Delhi running scores of schemes. This is not a new thing, in fact there have chief ministers in the National Development Council in Delhi who have raised the issue and many exercises have been initiated to reduce the plethora of schemes. The central government when its speaks of decentralization should stick to its promise of doing away with the plethora of funding it controls. But somehow we don't seem to take those final steps which involve dismantling structures which have become irrelevant.

I think it's a matter of time; and it is logical. Ultimately decentralization is a logical thing to do; you cannot have schemes only because you need give work to departments becoming rapidly obsolete; that's not how public money should be spent.

When you say it's a matter of time are you saying that enough pressure is going to come on the Centre from various State government rural development ministries or do you mean that this system will collapse on its own weight?

To address the first question, the system is not going to collapse on its own. But the system might change. This is a democracy. Many states, many chief ministers, including Karnataka's CM have made the point that the Centre must do away with irrelevant schemes. Digvijay Singh, the CM of MP has also raised this and the Planning Commission has said it as well. I think there is a lot of pressure building up and the logic is too clear for it to escape anyone. But it does take time. This ultimately a democracy and things tend to go a bit back and forth.

You see, the central government also has its concerns. In fact sometimes when you speak to the Centre, you get the sense that they believe that if they were to give everything back to the states, then the states will not spend the funds according to national priorities. They sometimes cite the cases of cash strapped state governments which divert money meant for specific purposes for critical expenses like salaries and other commitments.

But my point is that there are states and states. Karnataka is not that kind of a state. We do not divert Central funds for salaries and so we cannot be lumped with fiscally constrained states.

In one of your reforms recommendations, you rejected a change made in a previous legislation, under which the power to make reservations and delimiting of constituencies was vested with the Deputy Commissioner, an officer of the state government. You want that power to be restored to the State Election Commissioner. What real problems have come about because of vesting the delimiting of constituencies with the DC?

It's not that the DCs were not doing their jobs. It's a question of sticking consistently to a principle. You must have effective regulation mechanism when a decentralized system is in place. An effective regulation mechanism must be outside the government hierarchy, as I mentioned before. We stuck to that principle consistently. It's not that DC made mistakes or that they are amenable to pressure, etc. My experience does not show that there is a pattern emerging. But it is the consistent application of a principle that, if you consider the PRIs to be self governments in their own right in their own distinctive spheres - which is what the constitution says -- then you must have an independent agency which regulates their action outside the govt, and not government functionaries.

There are reports that your working group that came with these comprehensive reforms recommendations was very bureaucrat heavy. For example, N C Gundu Rao in his article of January 2003 in the Deccan Herald stated that your working group is using PRIs as guinea pigs for experimentation.

That is a pretty regrettable stand to take. First of all, labeling and condemnation is undesirable. For instance, to say that bureaucrats are anti-people, MLAs are anti-Panchayat Raj is completely wrong. There are no hard and fast rules or patterns. Sometimes when you go to a taluk, you find that the gram panchayat believes that the ZP is a bigger oppressor than the MLA. They prefer to go the MLA than the ZP. In other cases the MLAs are against gram panchayats, because of some local politics.

Consistently, what we find is that there is no pattern. So when there is no pattern, labeling of any nature is a pretty regrettable thing. Secondly, when Mr.Gundu Rao wrote the article he had not read the report and he admitted to that. It's a pretty sad thing to comment adversely on a report that one had not read in the first place.

There are many groups in Indian civil society that are demanding more transparency and decentralization in the normal process of democracy. Do you think the state government can take the help of self-help groups, rural trade associations or other groups to actually take your ministry's reforms forward?

Certainly. In rural areas for example we have these the 'stree shakti' groups, which are around 70,000 in number and we find interestingly that many of the stree shakti members are also panchayat members. So they carry across the concerns back and forth between civil society and the panchayats. In fact I would say that because of the relatively small number of citizens electing a panchayat member (around 400 people elect one member - whereas in urban areas the ratio is more like 10000 to 1), the interaction between the public and the elected members is much better in a rural area than in an urban area. The panchayat member has eye-contact with virtually every person who votes for her.

But there is a line that we would draw with respect to civil society organizations (CSOs). We must understand the position of civil society groups. They are vigilance groups and they exercise pressure and vigilance to ensure that the PRIs are not stepping out of line. Nowadays, there is a tendency to use the CSOs as substitutes for government departments or PRIs for direct delivery of services. I think this is not sustainable in the long run.

There is a fair amount of literature even with respect to India which shows that user groups tend to fade away within 5 to 6 years of project funding being stopped. Some government departments have this tendency to work below the PRIs by creating parallel institutions of user groups and user committees etc. This is not sustainable. I would very wary of using a user group as a substitute for a government department because a user group could be equally non-transparent. Furthermore, it is not a democratically elected body and it could be subject to elite capture also.