Faced with a financing shortfall for the Jal Jeevan Mission (JJM), the Jal Shakti Ministry is pitching for additional funding of ₹82,000 crore from the 15th Finance Commission for the project to provide drinking water tap connections to every rural household by 2024. Only 18% of households are currently covered.
The Ministry also wants to control the flow of the Commission’s funds to panchayats for water and sanitation.
In a presentation made to the Commission this week, the Ministry showed that there had been a 45% shortfall in financing the JJM by both the Centre and the States in its first year of 2019-20. The planned Central share for the year was ₹ 20,798 crore, but actuals were only at ₹12,000 crore. The share due from States was ₹8,329 crore, but the shortfall was more than ₹4,200 crore. Similarly, in 2020-21 as well, there has been a 32% shortfall at the Central level.
Resource constraints
There are “post- COVID-19 resource constraints both at Centre and States,” the Ministry told the Commission. It pitched for additional funding of ₹82,000 crore to meet the need for capital intensive projects in water scarce areas, and areas where the water has been contaminated by arsenic or flouride, or has high-salinity levels.
Also read: Govt to launch Jal Jeevan Mission to bring piped water to households: Prime Minister
The Ministry also wished to take more direct control of the Commission’s grants to panchayats. In its interim report for 2020-21, the Commission had allocated ₹30,375 crore as tied grants to rural local bodies for drinking water and sanitation “in order to ensure additional funds to the local bodies over and above the funds allocated ... under the Centrally sponsored schemes, Swachh Bharat and Jal Jeevan Missions.”
Also read: Debating water quality
However, the Ministry complained that there is “no handholding and identification of work,” “no criteria and indicators to assess the performance of panchayati raj institutions” and “no pressure on gram panchayats to dovetail FC grants with JJM.” It proposed that the money be placed with the Jal Shakti Ministry instead, which would in turn release it to the panchayats, to ensure that they follow the JJM’s five-year village action plans.
This kind of centralisation would be a regression from the 14th Finance Commission’s move to empower panchayati raj institutions, says N.R. Bhanumurthy, professor at the National Institute of Public Finance and Policy.
“We cannot go back to a situation of putting strings on panchayat funds. It is true that there are issues at the panchayat level, with some having huge unused funds, but there must be other ways to deal with that,” he said.
Caution against conditions
Earlier, in a February 2020 meeting of the FC’s own advisory council, some members also offered caution against excessive conditions being placed on grants in their feedback on the 2020-21 recommendations. According to an FC note on the meeting, economist and council member Indira Rajaraman felt that, “Performance conditionalities are very difficult to assess in real-time. Either the payment gets delayed or it is not made at all.” Fellow council member Manoj Panda also felt that, “Too many conditions should not be imposed on grants.”
The JJM, which has a five-year budget of ₹3.6 lakh crore, had expected to get this money through a convergence of financing sources. The Finance Commission’s grants for panchayats would be used for grey water management and operation and maintenance of the water supply system. Apart from the direct budgetary allocation for JJM, the Ministry planned to use money with the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGA), and the Compensatory Afforestation Fund (CAMPA) to create sustainable water sources. Corporate social responsibility, community donations and parliamentarians’ funds for local area development would also be used for the village-level infrastructure.
