Hyderabad, Nov 29 (FN Representative) 15th Central Finance Commission (CFC) Member Dr Ashok Lahiri on Tuesday said there is a need to strengthen the Panchayats to mobilise internal revenues for efficient service delivery, In his inaugural address at the two-day National Conclave on State Finance Commissions (SFC) organized by the National Institute of Rural Development and Panchayati Raj (NIRDPR) at Rajendranagar here, Dr Lahiri raised many issues relating to governance in Panchayati Raj Institutions. He pertinently pointed out that these local governments actually touch the people at the local level by providing them basic services. “Gandhiji greatly believed in grassroots democracy, and we see democracy in action only at Gram Sabha. There is a need to strengthen the Panchayats to mobilise internal revenues for efficient service delivery,” Dr Ashok Lahiri said.
Reminding that the 15th Central Finance Commission had recommended enhancing the professional tax from the existing limit of Rs 2,500 to Rs 18,000 per annum. “The Panchayats should mandatorily collect property tax, and it needs to be considered by the States,” he added. Sunil Kumar, Secretary, Ministry of Panchayat Raj (MoPR) explained the role of CFC and SFCs in strengthening Panchayati Raj Institutions. He said MoPR has drawn up a broad vision for the socio and economic transformation of rural areas through eGramSwaraj, SVAMITVA and Audit online, etc. Therefore, there is an urgent need to align the functioning of SFCs to maximise their contribution to strengthening the finances of Panchayats. Sunil Kumar expressed hope that this Conclave would deliberate on redefining the role and functioning of SFC in a collaborative and consultative manner. He assured that the recommendations of the Conclave would be taken up with the States for consideration and implementation. Dr C S Kumar, Additional Secretary, MoPR explained the background and objectives of the Conclave. He pointed out that finance is the lifeblood of the functioning of any organisation, and the SFC is significant in translating the mandate of the Constitution of India to make the Panchayats self-governing institutions.
Kumar said only nine states had constituted the 6th State Finance Commission (SFC), while another seven had established the 5th State Finance Commission. “There is a considerable variation in the functioning of SFCs and their recommendations. Though taxation powers are given to Panchayats in State Panchayati Raj Acts, rules are not framed in many States. With the results, Panchayats are unable to mobilise their own source revenues,” Dr Kumar said, adding that extensive deliberations amongst the relevant stakeholders would lead to an actionable roadmap to professionalise the SFCs. Dr G Narendra Kumar, Director General, NIRDPR said that the Conclave would focus on the issues for all-round analysis and working of SFCs, and suggest a broad roadmap and strategy towards bringing excellence to the functioning of SFCs in the future. About 40 distinguished dignitaries comprising Chairpersons & Members of SFCs, and the representatives from research institutions are taking part in the Conclave. The two-day deliberations would focus on the devolution formula adopted for the Local governments, processing and decisions on SFC recommendations, issues in the implementation of SFC recommendations, Coordination between SFC and CFC recommendations and implementation, Suggestions of SFC for generating OSR, and SFC recommendations on improving local governance.