KERALA: 7 years on

KERALA: 7 years on

In Kerala's Kozhikode district, there exists a village that doesn't depend on government dole: Olavanna's panchayat has been successfully running its own drinking water project since the 1990s. This is completely unlike the way the United Democratic Front (UDF) government functions. The Kerala Rural Water Supply and Sanitation Agency (KRWSSA), for instance, has borrowed Rs 300 crore from the World Bank to finance a Rs 450-crore drinking water and sanitation project in 80 panchayats. Loans have also been taken from other foreign institutions for roads, power and reforming governance. A Madhavan, president of Eramiyur panchayat in Palakkad district, also can't go the Olavanna way. "The World Bank (drinking water) project has already started here," Madhavan says sadly. "Tell me, how can they forget Olavanna?" asks A S K Nair, of the Centre for Earth Science Studies, Thiruvananthapuram. "Olavanna has become a metaphor for governance. Why hasn't Olavanna been replicated is a question being asked with increasing urgency today."

On December 17, 2003, the state planning board (SPB) announced that rural water supply schemes would be handed over to panchayats. But Madhavan and other panchayat leaders weren't impressed. "The biggest problem is local bodies don't want to take up water schemes because there are no clear guidelines," says V Ramachandran, vice-chairperson of SPB. Out of 1,053 water bodies selected, only 166 have been transferred. Why?

Panchayats allege the government's policy on managing water bodies is blind "The Kerala Water Authority selected schemes without consulting local government bodies. Most of these schemes are not working," says P Kamalkutty, secretary, local self-government (LSG) department, Thiruvananthapuram. When people protested, the Kerala Water Authority (KWA) decided to 'rehabilitate' the schemes and give them to beneficiary groups of panchayats. "The KWA is unable to run these schemes. How do they expect the panchayats to do so?" asks Nair.

The confusion doesn't end there. "The KWA was set up as an autonomous agency in 1986 to centralise water distribution. Now KWA has been declared unviable and the KRWSSA has been set up for this," says Nair.

The Rs 450-crore loan makes people like R Shashi, president of a beneficiary group in Ayilur panchayat in Palakkad district, uncomfortable. "What if the state government backtracks from repaying the World Bank? Will the burden then fall upon us?" he asks.

Loans: reform clause attached
Panchayats and opposition parties are against government's massive foreign borrowings. The modernising government programme (MGP), for which the Asian Development Bank (ADB) has given Rs 1,800 crore, is supposed to reform the state's finance and governance, but critics say it will dilute decentralisation. MGP has 100 programmes for policy reforms in 20 government departments. But MGP believes that institutions delivering government programmes to the people have to be improved too. Therefore, 3,000 'service delivery' institutions -- primary health centres, district hospitals, police stations and anganwadis -- will be developed as 'model institutions'. About 70 per cent of these institutions are directly under the panchayats, and so local bodies would be subject to massive reforms. P Kamaluttty, secretary, LSG, says Rs 250 crore will given to local bodies in 2004-05.

"External loans were just 1 per cent of the state plan under LDF. Today, it's 21 per cent. Governance by people's representatives is being demolished and a few bureaucrats whom the ADB favours call the shots today," says K M Shajahan, additional private secretary to V S Achutanandan, leader of opposition in the Kerala assembly. " UDF fought an election saying Kerala's debt was Rs 23,000 crore in 2001. Today the debt has risen to Rs. 37,000 crore and they are still borrowing," he says. Under MGP, the state government plans to amend the Panchayat Act to levy a health cess. Also, rules will be brought in for social audit, revenue assessment and human resource management. To panchayats this reeks of privatisation, for which they are being turned into mere implementing agencies.

The UDF government has also suggested forming an urban regulatory authority. Its urban policy statement talks of privatisation of services in the future: municipalities should withdraw from being service providers and become facilitators. Isn't this tampering? Chief Minister A K Antony rejects such fears. "When I want to give everything to panchayats there is a problem and if I don't honour their wishes, I am accused of tampering with decentralisation," he says. But to T M Thomas Isaac, LDF MLA and former member of the SPB, "Decentralisation for the World Bank or any other donor agency is downsizing the government and taking away its responsibilities. Yet, four years ago, Shivarajan could approve plans and implement them fast. In five years, the panchayat built 9,051 houses, 5,000 toilets, 360 drinking wells, 20 roads and three mini water conservation schemes. For the first five years, the panchayat spent all its money on programmes decided by the gram sabha. Kerala's first rural research centre on village economy and culture was set up here in 1998. "Local government was emerging as a new culture but it is no more now. People are hardly interested in the panchayat," says S Mohan, who helped set up the centre.

"For two years, I have been sitting over a request for 750 houses. The panchayat is no more in charge. The district technical committee delays programmes," says Shivarajan.

Down To Earth reported in 2000 that out of 1,000 local bodies, 200 were doing 'very well' and 300 were 'moderately successful'. Now, S M Vijayanand, secretary in charge of planning and economic affairs, estimates hardly 100 panchayats are functioning satisfactorily. "Rest are without power and money," says a senior official.

In October 2003, 10 panchayats ousted their president and vice-presidents. C S Vidyasagar, president of Vithura panchayat was one among them. "The reason for my removal was partly political and partly administrative," he says. Vithura may soon be without a panchayat. The state election commission has served notices to panchayat members, asking them to explain why they shouldn't be removed for not holding gram sabha meetings four times in a year. During 1996-2000, Vithura had ensured houses and irrigation for 50 per cent its residents. But now Vithura has been hit by political clashes caused by implementing delays.

Back to paper work
To ensure accountability, the finance department has asked panchayats to go through guidelines comprising seven clauses and 89 sub-clauses. They also have to be fluent in 150 government orders relating to their power and functions. Each panchayat is required to give a certificate that it is following each guideline. V J Jose, president of the Eerattupettah block panchayat in Kottayam district, discovered that he could allot only Rs 2,000 for a new toilet for a physically-challenged resident, though the cost was Rs. 3,000. "This is what they call decentralisation here," says Jose, a Congress worker, who has written a letter to LSG Minister Cherkkalam Abdullah, criticising the government's decentralisation programme. "The Thalappulam gram panchayat in Eerattupettah wanted to set up rain guards to help marginal farmers, but the block technical advisory committee and district planning committee objected saying it didn't meet the guideline on subsidy," says Jose. "It will take my staff four to five months to complete the paper work," he says.

"Panchayats have not been able to complete works on time because of delay in allocating and transferring funds, and poor co-ordination among officials," says a study done by CapDecK last year. People's participation has come down drastically since 1998, says another study conducted in 84 panchayats by K N Hari Lal, associate fellow with the Centre for Development Studies (CDS).

BCs, supposed to displace contractors and involve people in implementing projects, have been changed. Contractors and government engineers had joined hands to scuttle them. Today, new guidelines make it mandatory for village panchayats to tender works above Rs 25,000. The intent here may be good, but panchayats are unable to implement works. "We put out tenders for re-tarring roads and constructing water tanks, but no one has replied. Contractors know that they will have to wait for their money," says U K Narayanan, president, Mulamkunnathukkavu panchayat. "Food is served but we have no permission to eat," he says.

The treasury controls
Earlier, panchayat members managed funds with their gram sabha's approval. But in August 2003, panchayat accounts were put in the panchayat secretary's personal deposit account in August. The secretary, a government official, now signs all expense requests. "Panchayat presidents theoretically control the officials, but only the government can take action against them," says B K Aliyar, former president, Eerattupettah Panchayat. The Institute of Rural Management, Anand, has told the government that such 'dual control of officers' are a hurdle. "People like Isaac told us that there was no need for us to visit Thiruvananthapuram. But now we have to keep visiting the capital to get an incompetent official transferred or removed," says Jose. "My block development officer meets the district collector some 15 times a month. It is because the collector can suspend the block development officer, but we can only recommend action against our secretary," he says.

Abdullah told Down To Earth that local bodies have been getting funds regularly for four months. "In fact, the money for October (2003) has already been disbursed," he says. But Mulamkunnathukkavu in Thrissur district, the panchayat has a credit of Rs 15 lakh in its treasury account. "The cheques we issue are cleared only in the last week of a month and even then the government can, and has, imposed a treasury ban," says panchayat secretary Rema Devi. The Area Development Scheme, which gave each MLA Rs 50 lakh, has also hit local governance. " MLAs can arbitrararily decide what to do with their Rs 50 lakh. This has created a power centre against panchayats," claims Isaac. " MLAs demanded this fund during LDF's rule too but we managed to scuttle it," he says. The UDF government's separation of rural development and local self-government departments in 2001 is another setback to decentralisation. They had been merged in 1999 to shut down the district rural development authority (DRDA), which were challenging the DPCs. UDF also plans to revive the DRDAs.

Where did LDF go wrong?
Decentralisation wasn't perfect under the LDF too. "Political backing for decentralisation, whether in the LDF or UDF, is woefully lacking," says M K Prasad, former general secretary of Kerala Sastra Sahithya Parishad (KSSP), an important promoter of people's planning. Lack of political will in LDF was evident in the third year of the campaign itself, he says

"The CPI thought that resource persons in panchayats were CPI(M) supporters,"says Jos Chathukulam, of the Centre for Rural Management, Kottayam. "E M S Namboodripad was a strong champion of decentralisation but he never put forth his ideas in a party forum or a document. Maybe that's why CPI(M) has not wholeheartedly embraced the idea (see box: Conspiracy theory, the Left sees red)."The LDF was highly centralised and everything was concentrated in their office," says C P John, member of state planning board.

People participated, but the method was 'top down'. Some contend that corruption also became decentralised. Local bodies didn't have enough technical, administrative and financial resources. The bureaucracy refused to cooperate. In fact, officials used the state's coalition politics to their advantage. The CPI-dominated agriculture department refused to cooperate with the local bodies. Ultimately, the LDF gave in: the district collector was made the chairperson of the district level expert committee in 1997, and a retired official chief of the block level expert committee. "This compromise was a turning point," says Chathukulam.

"The real fight is between elected representatives and the bureaucracy, not the LDF and UDF. So if that conflict has not been resolved, then how can there be real decentralisation?" says Shaji. Kamalkutty agrees. "Mindsets have not changed at the top. The government is committed, but the secretaries oppose the programme," says Kamalkutty.

The UDF says the state's finances were so bad that it had to go in for loans. "Kerala faces an annual fiscal deficit of Rs 2,045 crore," the UDF said in a white paper on state finance after taking over in June 2001. "The government is unable to honour legal instruments drawn on it and the exchequer's credibility has fallen to abysmally low levels," said the paper. Amid this crisis, the state faces its biggest challenge: turning around its economy. The Tenth Five Year Plan (2002-7) is crucial because Kerala has to implement 1,40,000 development plans in 951 village panchayats in three years. Will decentralisation survive this phase?