The Fifth State Finance Commission is likely to moot firm measures to prompt local self-governments to rework their priorities and augment resource mobilisation to strengthen the financial base.
The commission, which is expected to submit its first report next month, is understood to have found that a majority of the local self-governments have deviated from their core civic functions such as refuse management and improvement and maintenance of basic public amenities, among others. It has taken note of the serious lapses in resource mobilisation and execution of Plan projects.
In this context, the commission will put forward suggestions that will make the local governments to rework their priorities and also drastically reduce their dependence on government assistance by shoring up their own revenue. The local governments are likely to be warned against their alleged indifference in tax assessment and apathy in tapping the tax potential. Rather than allotting a sum as maintenance grant, the commission may consider the option of restricting the allocation on the basis of the assets created in each local body.
The grave resource crunch of the government may not be an impediment in devolving funds to the local governments. Still, the commission will evaluate the financial position of the government before making the crucial recommendations, sources said.
Scrutiny
The alleged laxity in fund absorption will come up for a thorough scrutiny. Corporations, municipalities and district panchayats could expend only 50 per cent of the Plan funds left at their disposal. Doubts have been raised about the expenditure pattern since a lion’s share of the funds was expended at the fag end of the financial year in a totally unproductive manner. This calls for a change in the utilisation pattern and the commission may submit recommendations for streamlining the system in force, sources said.
The concurrent auditing system, especially in the case of civil works implemented by local governments, would also be reviewed by the commission. The commission has already interacted with elected members as well as officials of about 100 local governments and studied the problems being faced by them. It would offer suggestions to address their core issues, sources said.
Fifth State Finance Commission finds that majority of the local
self-governments have deviated from their core civic functions.
