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There has been disparity between rural and urban areas across the country in terms of many socio-economic and infrastructural development indicators. People in rural areas, generally, have lower levels of literacy, inadequate access to health services, poor infrastructure, poor quality of basic amenities, and face agrarian distress, migration and unemployment. The agriculture and allied sector contributed only around 17 percent of the total GDP of the country in 2017 whereas more than 70 percent of rural population is dependent on this sector for livelihood.

The Union and State governments have been trying to address the aforementioned problems in rural areas by initiating several development programmes. Further, for addressing the problems in rural areas, Panchayati Raj Institutions (PRIs) were given a Constitutional status through enactment of the 73^rd Constitutional Amendment Act (CAA) in 1992. The core purpose of the CAA was empowering the PRIs through effective devolution of power in terms of functions, funds and functionaries so that they work as effective Institutions of Local Self-Government. CAA gave 29 functions to PRIs with adequate emphasis on preparation and implementation of Plans for economic development and social justice.  Through the CAA, PRIs have been given the power and provision for decision making, resource mobilisation, and control over expenditure, administrative power, decentralised planning and participatory budgeting at Gram Panchayat, Block Panchayat and District Panchayat levels. To empower PRIs, functions have been devolved, but genuine devolution through effective administrative and financial devolution to PRIs remains patchy in many states even after more than 25 years of CAA.

Despite the provisions in the CAA, functionaries have not been devolved to PRIs by many line departments except Rural Development and Panchayati Raj. Further, there are several sanctioned posts for various positions at different levels of governance in the line departments like Rural Development and Panchayati Raj lying vacant for a long time. For instance, in the Rural Development department of Uttar Pradesh, staff vacancies in the department stand at 28 per cent, but it varies across different levels of governance. The percentage of vacancy is 27.4 at the Block level, 13.9 for District Level Offices, 26 for Division Level Offices and 36.9 for State Development Services. Vacancy for the position of Gram Vikas Adhikari is 37.8 percent. Around 44.0 percent of total sanctioned posts are vacant under District Rural Development Authority in the State. The percentage of vacancies under the sanctioned posts of key officers varies at the district, block and GP in Panchayati Raj Department of Uttar Pradesh. It is 35 percent for the District Panchayati Raj Officers, 19 percent for the Assistant Development Officers and 24 percent for the Gram Panchayat Officers.

Similarly, in Rajasthan, the Block and Zilla Parishad have vacancies that stand at around 66 per cent and 63 per cent respectively. Gram Panchayats have more than 55 per cent vacant posts at the levels of Gram Sevak and Lower Divisional Clerk (LDC-II).  The vacancy for posts of Gram Sevak and LDC accounts for 37.9 and 63.0 per cent respectively.

Subsequent to the recommendations of the Fourteen Finance Commission (FFC), the Union government has devolved high magnitude of untied resources to the States. The share of the states in the divisible pool of central   taxes has gone up from 32 to 42 percent. However, so far the state governments have not utilized the untied resources for recruitment of human resources and filling up the vacancies in the Rural Development and Panchayati Raj departments.

At present, the main sources of finances for PRIs comprise the Centrally Sponsored Schemes (CSSs), State Sponsored Schemes, grants-in-aid as per recommendations of the State Finance Commissions (SFCs), the Central Finance Commission (CFC), and their Own Source Revenue (OSR). The CSS funds for rural development programmes are largely tied funds where PRIs have little discretion to decide their own expenditure priorities, whether it is for hiring of staff such as clerks, accountants, engineers or planners or for creating infrastructure for better implementation of rural development programmes.

Over the years a certain percentage of total allocation in CSS related to rural development programmes was made for meeting administrative costs towards hiring staff on a temporary basis. The major rural development programmes includes MGNREGS (6 percent), DAY-NRLM (6 Percent), PMAY-G (4 Percent), NSAP (3 Percent) and NRDWP (5 Percent). The Fourteenth Finance Commission (FFC) grants to Gram Panchayats gives them 10 per cent of total grant as establishment cost. However, these administrative costs towards hiring staff could not address the shortage of staff due to lack of proper human resource policies and appointment of staff on contractual basis. Further, PRIs do not have control over the staff recruited under rural development programmes.

It is found that lack of devolution of functionaries and shortage of staff at PRIs has been a major factor behind poor utilisation of funds, delay in completion of projects and inadequate collection of OSR. The grants like CSS, SFC and CFC released to the PRIs have not been utilised fully.  A major hurdle in this process has been the delay in submission of Gram Panchayat Development Plan and finance accounts to relevant institutions. Further, non-availability of staff delays the submission of utilisation certificates, which in turn causes delays in the release of funds in several flagship programmes like funds from CSS, the SFC and CFC grants at the State and PRI levels.

The views expressed in this piece are those of the author, and do not necessarily reflect the position of CBGA. You can reach Jawed Alam Khan at jawed@cbgaindia.org.