Funds for clean air: Get the blueprint right

Committed funds for clean air action excites hope. Needs strong performance metrics. But there are also risks of underfunding some key sectors of pollution

By Anumita Roychowdhury
Published: Friday 06 November 2020
Funds for clean air – get the blueprint right. Photo: https://imaggeo.egu.eu/

The Union Ministry of Finance has released Rs 2,200 crore to 15 states for clean air action in million-plus cities. It was given on the basis of recommendations of the 15th Finance Commission.

The amount is the first instalment and is meant for improvement in air quality over a period of five years. Despite the pandemic disruption, the Union government has kept its fiscal promise of disbursing Rs 4,400 crore for million-plus cities in its Union Budget for 2020-21.

It is good news for all those who have been waiting for committed funding to make clean air action a reality.

This money is available for “formulating and implementing plans for ensuring cleaner air”. But are we prepared with the performance metrics for this new spending to deliver on clean air goals?

Before this allocation was made, the operational guidelines for the implementation of this local body grant was issued in June 2020.

This has made the Union environment ministry responsible for developing city-wise and year-wise targets on ambient air quality for 2020-2025, based on annual average concentration of PM10 and PM2.5 to monitor improvement.

This is backed by the 15th Finance Commission’s overall target of five per cent annual reduction over five years. This grant will fund air quality measures, including capacity-building of the local bodies and air quality monitoring.

Its focus on 42 urban agglomerations that include several municipalities is a departure from the city-centric focus of the National Clean Air Programme (NCAP) and approximates the airshed management approach.  

The state finance departments have been asked to transfer grants-in-aid directly to all these local bodies within 10 working days of receipt from the Union government without any deduction.

If there is delay, the state governments will have to release the amount with interest according to the effective rate of interest on market borrowings / state development loans for the previous year.

Good step, but...

For the first time substantial and dedicated central funding has been committed for air pollution control. This has stirred strong interest as hard money brings certainty into planning and implementation.

But this has also raised several questions about the scope of action, performance measurement, mechanism and processes and institutional arrangement to make a difference.

Co-existence with NCAP

This injection of funds into the urban local body (ULB) system is consistent with the provision of the 74th Amendment of the Constitution.

The amendment empowers the Finance Commission to review finances of municipalities to assign taxes, share taxes and give grants-in-aid to the municipalities.

The new funding will be routed through the state finance departments, the state urban development departments and the targeted ULBs. The big difference is that for the first time, the Finance Commission has explicitly linked this fund with air quality goals.

This has certainly brought much needed resources in deficient municipal systems and infrastructure. This can be used to deal with all streams of waste, construction, dust generation, pavements, parking restraints and in some cases even bus operations that are needed for air pollution control.

These are the ULB functions and responsibility that are also part of the clean air action plans of the non-attainment cities under the NCAP. Infusion of resources in the ULB system can certainly strengthen these areas that suffer from enormous infrastructure deficit.

However, the guidelines for ULB funding has not made any linkage or alignment with the ongoing NCAP programme that has remained underfunded.

In fact, budgetary allocation for NCAP that covers 122 cities is a mere Rs 450 crore and grossly inadequate for transformative changes. While the ULB funding will be routed through the urban development departments in states, the NCAP fund is channelised through the air quality regulators – state pollution control boards. How will the two twain meet for maximum impact?

The two systems will have divergent framework of monitoring, reporting and accountability. The state governments need creative and innovative solutions to align the ULB funding with the NCAP process for maximum leveraging and prevent action in silos.

The chief secretary level committees that have already been formed for NCAP monitoring at the state level need to ensure this alignment to prevent duplication of action plans.

Risk of underfunding

Dedicated funding to improve municipal capacity and infrastructure has a strong potential for pollution control from widely dispersed sources of pollution that are difficult to control.

The new money can bridge the infrastructure gap for waste management and recycling for a zero landfill policy, douse dust from construction and roads, make footpaths and cycle tracks accessible and safe and promote parking measures to restrain vehicle usage.

But there is a serious risk of other key sectors of pollution — industry, power plants, vehicles and transport, and clean fuel strategy, remaining neglected and under-funded as these sources are outside the ambit of the ULB responsibility.

How can five per cent annual reduction in particulate pollution which is a target of both ULB and NCAP funding, be achieved with ULB action alone and without adequate resources to combat toxic pollution from other prominent sectors.

As the new fund is expected to flow based on the business rules of the government departments, there is no clarity how multi-sector action is possible through interdepartmental funding.

The Finance Commission has allowed a supportive grant from this kitty for the state pollution control boards to strengthen air quality monitoring to support ULB action.

But how this imbalance between the financial power of the ULB fund and underfunding of NCAP will play out at the state level is not clear yet.

State pollution control boards (SPCB) need a more substantive scope for spending of this fund and the Finance Commission must allow them to do so.

SPCBs need to include ambient air quality monitoring at local and airshed level with regulatory monitors and satellite data. Smart monitoring of local exposures and source-based emissions monitoring for enforcement and good data protocol for reporting verifiable improvement in air quality should also be included. But underfunding of other pollution sectors will remain a serious concern. 

How to measure performance?

The ULB funding has come with an air quality target as well as accountability framework. If air quality improvement target is not achieved, the balance undistributed fund can be withheld and redistributed.

The environment ministry will have to step in right away to detail out the process and performance indicators and service level benchmarks for each sector to make improvement trackable and verifiable. This also needs metric for explicit alignment with NCAP implementation.

But this high level air quality target of year-on-year improvement needs to be supported by process level outcome to first fix the systems and infrastructure across all ULBs to make a verifiable progress.

This is needed to make air quality based outcomes effective and achievable. The experience with NCAP implementation has already exposed weak local capacities, enormous deficit in infrastructure and inadequate designing of solutions across all sectors.

Therefore, this funding should be designed for broader reforms. Identify key buckets of action from the integrated action plan. While preparing the financial plans for this ULB funding, also define the financial plan for other pollution sectors under the NCAP process.

Identify how the integrated action will be done via state / national grants, industry investment, polluter pay principle or dedicated green revenue and contingency plan if anything should go wrong with the funding sources in any sector.

Even the institutional arrangement for monitoring of the two programmes seems a little hazy. Under the NCAP process, SPCBs and air quality regulators under the aegis of the chief secretary level committees are responsible for coordinating, monitoring and seeking progress reports from all departments including ULBs to track multi-departmental action.

The new ULB funding tilts this balance as the SPCBs will now assist the ULBs with monitoring or in whatever manner the role is defined.

Under NCAP and the compliance mechanism of the Air Act, air quality regulator is also responsible for penal action for non-compliance and ULBs are bound by that. Therefore, the compliance framework for both the programmes and the respective roles of agencies will have to be better defined for operational and reporting purpose. This requires high level compliance monitoring programme for both the programmes.

This new money for real action is exciting and a great opportunity for green recovery at this time of economic disruption. We now need to get the blueprint right for the real and verifiable change.

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