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Context: The “State Finances, Study of Budgets of 2021-22” report, correctly identify the role of the city governments in meeting the challenges the pandemic has thrown up, the report also points to the draining of resources.
Role of local governments as per RBI report
Empowering financially: This could happen by ‘empowering them financially through higher resource availability.
Limited coverage of property tax: The RBI report also highlights the limited coverage of property tax and its failure in shoring up municipal corporation revenues.
Issues faced by city governments
The general approach towards urban empowerment has remained piecemeal in India.
The latter refers to urban reforms — empowering urban local bodies to perform 18 functions listed in the 12th Schedule.
The only exception to the rule has been the people’s plan model of Kerala where 40% of the State’s plan budget was for local bodies (directly) with a transfer of important subjects such as planning, etc.
How to achieve functional autonomy for city government
Nearly 35% of the population lives in urban centres.
Instead, finance commissions recommended grants to urban local bodies based on a formula of demographic profile.
The often-cited example is how cities in the Scandinavian countries manage their functions well — from city planning to mobility to waste management.
By: Shubham Tiwari ProfileResourcesReport error
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