Resource Mobilisation and Utilisation by Panchayati Raj Institutions in UTs without Legislature

Jacob John and Ruchi Jain
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Jacob John: Kerala Development Society (KDS Delhi), New Delhi
Ruchi Jain: NCDEX Institute of Commodity Markets and Research, New Delhi.

Journal of Social and Economic Development, 2008, vol. 10, issue 2, 256-273

Abstract: Panchayati Raj Institutions (PRIs) in Union Territories (UTs) without a legislature have been grappling with many complex problems -- structural, administrative and fiscal. The Andaman and Nicobar Islands, Chandigarh, Daman and Diu, Dadra and Nagar Haveli and Lakshadweep Islands are the five UTs in India that do not have a legislature. This paper examines the essential features of the PRI system in these UTs, analyses the mobilisation and utilisation of funds by PRIs and suggests concrete measures to improve their functioning. The study reveals that though the administrative bodies of all the five UTs have specified that functions be transferred to PRIs, this is not being executed. In the absence of a legislature, the UT administrator and the bureaucracy have been holding powers. A huge amount of funds available with PRIs remain unspent every year primarily due to the lack of functions and functionaries. Significantly, the accumulated unspent balance with the PRIs has had an adverse effect on mobilisation of own source of revenue. Certain concrete steps that are essential to improve fund mobilisation and utilisation by the PRI system in the five UTs are suggested. Own source of revenue needs to be mobilised by strengthening tax assessment and collection process. The study highlights the urgency for the removal of the mismatch between activity mapping and corresponding funding of PRIs under various budget heads of UTs.

Date: 2008
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