Local self-governance

Indian Political System(BPSC) Centre - State Relations

Context: The article explains the working of local self-governance in India. It also explains the normative basis of local self-governance.

The 73rd and 74th constitutional amendments, which established panchayats and municipalities, respectively, were passed by the Parliament in December 1992.
These amendments mandated that State governments constitute panchayats (at the village, block and district levels) and municipalities (in the form of municipal corporations, municipal councils and nagar panchayats) in every region.
They sought to institute a third tier of governance in the federal framework through the devolution of functions, funds, and functionaries to local governments.
But despite these reforms, municipal governments are often seen to be ineffective in addressing even the most basic needs of citizens, such as reliable water supply and walkable footpaths.

Local self-governance is associated with the concept of subsidiarity and is typically grounded on two broad arguments.
First, it provides for the efficient provision of public goods since governments with smaller jurisdictions can provide services as per the preferences of their residents.
Second, it promotes deeper democracy since governments that are closer to the people allow citizens to engage with public affairs more easily.
Strengthening local democracy and delegating tasks to achieve the goals of economic development and social fairness are the basic values that the amendments seek to ingrain.
Above amendments demand that States grant municipalities and panchayats the authority they need “to enable them to function as institutions of self-government,” including the ability to create and carry out plans and programmes for economic growth and social justice.
They also mandate the regular conduct of local elections, provide for the reservation of seats for Scheduled Castes, Schedules Tribes and women in local councils, and institute participative forums like gram sabhas in panchayats and ward committees in municipal corporations.

Local governments, especially municipalities, operate with limited autonomy and authority mainly due to the inherent limitations of the 74th amendment such as discretion given to the States regarding the devolution of powers and levying of local taxes.
Failure of State governments and courts to implement and interpret the amendment in letter and spirit also limits the authority of local governments.
Since cities are economic powerhouses and controlling urban land is crucial for funding State governments and political parties, state governments are reluctant to apply the 74th amendment.
A narrow interpretation of the 74th amendment by the courts has allowed State governments to retain their control over cities.

The Patna High Court’s recent order declaring some provisions of the Bihar Municipal (Amendment) Act, 2021 as unconstitutional is path-breaking since it tested State municipal laws against the letter and spirit of the 74th Amendment and can potentially reset the position of local governments in India’s federal framework.
The court also pointed out that though the state legislature has the power to legislate on matters concerning municipal bodies, however, its involvement in the functioning of local bodies has to be minimal.
By virtue of the amendments made to the Bihar Municipal Act, 2007, inter alia, all the powers of appointment, selection, posting, and transfer of employees of Grade-C & D were taken over by the State Government.
Local governments must be empowered with an inviolable and clearly defined legislative and executive jurisdiction, effective control of the local bureaucracy and adequate and non-discretionary fiscal devolution, and direct empowerment of stakeholders over local institutions and public services to correct the distortions and imbalances in our plural democracy.

As India is undergoing a centralising shift in its politics, economy, and culture, there’s also been a renewed assertion of federalism. Debates on federalism should include larger discussions on how power should be divided and shared between governments at the Union, State, and local levels since local governments are, normatively and structurally, an integral part of the federal framework of the Constitution.