Local Finance, Fiscal Decentralisation and Decentralised Planning: A Kerala Experience

250 Pages·2020·2.211 MB·English

by  B. A. Prakash

LOCAL FINANCE,
FISCAL
DECENTRALISATION
AND
DECENTRALISED
PLANNING
A Kerala Experience
B. A. PRAKASH
LOCAL FINANCE,
FISCAL
DECENTRALISATION
AND
DECENTRALISED
PLANNING
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LOCAL FINANCE,
FISCAL
DECENTRALISATION
AND
DECENTRALISED
PLANNING
A Kerala Experience
B. A. PRAKASH
Copyright © B. A. Prakash, 2020
All rights reserved. No part of this book may be reproduced or utilized in any form or by any means,
electronic or mechanical, including photocopying, recording or by any information storage or retrieval
system, without permission in writing from the publisher.
First published in 2020 by
SAGE Publications India Pvt Ltd
B1/I-1 Mohan Cooperative Industrial Area
Mathura Road, New Delhi 110 044, India
www.sagepub.in
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Published by Vivek Mehra for SAGE Publications India Pvt Ltd. Typeset in 10.5/13 pt Berkeley by
Zaza Eunice, Hosur, Tamil Nadu, India.
Library of Congress Control Number: 2020930413
ISBN: 978-93-5388-306-5 (HB)
SAGE Team: Rajesh Dey, Syed Husain Naqvi, Madhurima Thapa
CONTENTS
List of Illustrations vii
List of Abbreviations xiii
Preface xvii
Chapter 1 Introduction 1
Chapter 2 Fiscal Decentralization:
Theoretical Issues 12
Chapter 3 Fiscal Decentralization and
Mobilization of Own Source of Revenue 29
Chapter 4 Finances of Gram Panchayats 41
Chapter 5 Finances of Block and District Panchayats 74
Chapter 6 Finances of Municipalities 92
Chapter 7 State Finance Commissions in Kerala:
A Review 118
Chapter 8 Fifth State Finance Commission in Kerala:
Devolution Recommendations and
Status of Implementation 136
Chapter 9 Decentralized Planning:
Plan Performance of Gram Panchayats 159
Chapter 10 Decentralized Planning: Plan Performance
of Municipal Corporations 193
vi Local Finance, Fiscal Decentralisation and Decentralised Planning
Chapter 11 Summary and Lessons from
Kerala’s Fiscal Decentralization 207
Bibliography 218
About the Author 222
Index 223
LIST OF ILLUSTRATIONS
FIGURES
8.1 Horizontal Devolution of 5th SFC 147
8.2 Development Fund 148
8.3 Maintenance Fund 148
8.4 General Purpose Fund 149
TABLES
1.1 Number of Rural and Urban LGs in Kerala
from 1995 to 2015 7
1.2 Number of Wards of LGs in Kerala 8
1.3 Average Area and Population of LGs in 2011 8
1.4 District-Wise Distribution of LGs
(as on 1 November 2015; in Number) 9
2.1 Governance Structure 20th Century versus
21st Century 16
2.2 The Components of a System of
Fiscal Decentralization 22
2.3 Fiscal Decentralization Indicators 25
2.4 Central Involvement in Local Functions 26
2.5 Indicators of Fiscal Decentralization 28
viii Local Finance, Fiscal Decentralisation and Decentralised Planning
4.1 Distribution of Sample GPs 42
4.2 Total Receipts per GP: Amount, Composition
and Growth Rate 43
4.3 Tax Revenue per GP: Amount, Growth Rate
and Composition 45
4.4 Non-tax Revenue per GP: Amount, Growth Rate
and Composition 47
4.5 Tax Arrears per GP in 2011–2012 and 2014–2015 48
4.6 Amount Received per GP through Devolution,
Central Grants, Etc.: Amount, Growth Rate
and Composition 50
4.7 CSS Receipts per GP: Amount, Growth Rate
and Composition 53
4.8 Welfare Pension Receipts per GP: Amount,
Growth Rate and Composition 55
4.9 Total Expenditure per GP: Amount,
Composition and Growth 57
4.10 Administrative Expenditure per GP: Amount,
Growth Rate and Composition 58
4.11 Establishment Expenditure per GP: Amount,
Growth Rate and Composition 59
4.12 Expenditure on Decentralized Plan per GP:
Amount, Growth Rate and Composition 61
4.13 Maintenance Expenditure per GP: Amount,
Growth Rate and Composition 62
4.14 O&M Expenditure per GP: Amount,
Growth Rate and Composition 63
4.15 Miscellaneous Expenditure per GP:
Amount, Growth Rate and Composition 65
4.16 Expenditure on Welfare Pension per GP:
Amount, Growth Rate and Composition 66
4.17 Expenditure on CSS per GP: Amount,
Growth Rate and Composition 68
4A.1 Welfare Pension and Number of
Beneficiaries (2004–2005) 70
4A.2 Total Number of Staff in Sample GPs 71
List of Illustrations ix
4A.3 Average Staff Strength per GP 72
4A.4 Total Staff Strength (Category-Wise) 73
5.1 Distribution of Sample Block Panchayats 75
5.2 Total Receipts per Block Panchayats: Amount,
Composition and Growth Rate 76
5.3 Amount Received per Block Panchayat through
Devolution: Amount, Composition and Growth Rate 77
5.4 CSS Receipts per Block Panchayat 78
5.5 Total Expenditure per Block Panchayat:
Amount, Composition and Growth Rate 79
5.6 Decentralized Plan per Block Panchayat:
Amount, Composition and Growth Rate 81
5.7 Maintenance Expenditure per Block Panchayat 82
5.8 CSS Expenditure per Block Panchayat 82
5.9 Distribution of District Panchayats 84
5.10 Total Receipts per District Panchayat:
Amount, Composition and Growth Rate 84
5.11 Amount Received per District Panchayat through
Devolution: Amount, Composition and Growth Rate 86
5.12 CSS Receipts per District Panchayat 87
5.13 Total Expenditure per District Panchayat:
Amount, Composition and Growth Rate 88
5.14 Decentralized Plan Programme per District Panchayat:
Amount, Composition and Growth Rate 89
5.15 Maintenance Expenditure per District Panchayat 90
6.1 Distribution of Sample Municipalities 93
6.2 Profile of Sample Municipalities 94
6.3 Total Receipts per Municipality: Amount,
Composition and Growth Rate 96
6.4 Tax Revenue per Municipality: Amount,
Composition and Growth Rate 97
6.5 Non-tax Revenue per Municipality: Amount,
Composition and Growth Rate 99
6.6 Tax and Non-tax Arrears per Municipality
in 2011–2012 and 2014–2015 100