The 74th CAA introduced important changes for municipal governments. These changes are wide ranging and include provisions for reservations of seats, constitution of ward level committees, and SFCs amongst others. In the discussion below, we look at some of the most significant changes that the 74th CAA introduced.

It Improved the Relationship Between State and Municipal Governments

The 74th CAA established clear structures in the relationship between state and municipal governments (view Act here).

Before the Amendment, there was no formal recognition of how the two would operate with respect to each other. The state governments had their municipal acts but there was no constitutional mandate to actually follow them. Further, without the amendment, there was no way of ensuring that the state municipal acts would give at least some minimal autonomy to the municipal governments.

The Act defined the relationship by recommending clear division of functions and increased fiscal autonomy for municipalities. This was to make sure that there was minimal or no overlapping roles of the two governments, and that the dependency of the municipal government on the state government could be reduced.

Functions:

The 74th CAA provided 18 broad categories of functions, listed in Schedule 12, to be devolved to the municipal governments by the state governments. However, it was the discretion of the respective state governments to devolve functions as they deemed fit. In fact, in a panIndia study conducted by Nagrika, it was found that none of the states had devolved all 18 functions, while most municipal governments also undertook additional functions which were not part of the 18 functions.

These 18 functions cover a large area of service and infrastructure provision, including roads and bridges, sanitation, matters related to cultural and educational matters, and registration of vital statistics.

The broad categories cover many more functions within themselves. For example, one of the functions is ‘Water supply for domestic, industrial and commercial purposes’. But it can be broken down to multiple functions such as infrastructure creation, maintenance, generation of water, storing of water, distribution of water, etc. This depends on how individual states define each broad function and the functions they want to devolve to their municipal governments. For e.g. only in some states fire services are entrusted with city governments. Find the complete list of functions according to the 12th Schedule

Funds:

The Act mandated the establishment of SFCs and made them responsible for monitoring the finances of municipal governments. They were autonomous of state governments and made recommendations to the respective state governors regarding the distribution of ‘taxes, duties, tolls and fees’ between the state and municipal governments, the grants-in-aid for municipalities from the Consolidated Funds of the State, and other measures to improve municipal finances.

The creation of SFCs did not solve the problem of fiscal autonomy of the municipalities as the act did not make the recommendations made by the Commission binding for the state governments. Apart from this, the Act left it to the discretion of the state governments to make bylaws regarding imposition of taxes and sharing of funds with municipal governments through taxes, grant-in-aid etc.

Functionaries:

While the Act itself does not mention this aspect, the conversation regarding the 74th CAA is incomplete without the functionaries. The city officials carry out responsibilities and activities of the city government. By recommending the devolution of funds and functions, the Act made the presence of adequate functionaries at municipal governments an inherent provision as well. Functionaries are important in distancing the municipal governments from the state governments by providing a localised workforce to carry out functions at the city level themselves, thereby reducing the technical dependency on the state government. Some such functionaries include engineers, architects, health inspectors, tax collectors among others.

Ensuring Regular Elections

The 74th CAA extended the responsibility for the preparation of electoral rolls and undertaking of municipal elections to State Election Commissions (SECs). They not only conducted elections but also ensured that the rules laid out in the respective state’s municipal elections laws were followed. This provided for a body that was not under the direct control of the state governments to conduct municipal elections to guard against political interference. At present, SECs have been established for all states and union territories in India, except for J&K and Ladakh.

The presence of SECs has secured the institutionalisation of municipal elections through constitutional mandates. But it does not mean that elections at the local level are taking place regularly, without disruption. We will talk about them in our future articles of the Governance Series.

Ensuring Representation of Weaker Sections and Localised Concerns

The 74th CAA was responsible for ensuring the representation of women and persons belonging to Scheduled Caste (SC) and Scheduled Tribe (ST) categories by reserving seats for them in the elections under Article 243T. The Act leaves further powers with the state governments to reserve more seats as per their discretion.

For candidates from SC and ST categories, the number of seats to be reserved would be proportional to their population in the local area. For example, if SC and ST groups represented 10% and 20% of an area's population, then they would get 10% and 20% reservation for councillors’ seats respectively.At least 33% of the seats reserved for SC and ST persons were further reserved for women, as well as 33% of the total seats, including the seats reserved for women from SC and ST categories, would be reserved for women.

These reservations have helped to increase the number of local representatives in the municipal governments who come from disadvantaged backgrounds. This in turn helped bring up concerns and issues that are particular to these groups and were not represented earlier. For the purpose of representation, the following is how the reservation of seats will look for a municipality with a total of 60 seats and population shares of 30% and 10% for SC and ST categories respectively.

Apart from the reservations, the 74th CAA mandates the establishment of ward committees (WCs) for municipalities having a population of three lakhs or more under Article 243S. WCs provide for continued people’s participation even after the elections. The state government has the power to decide upon the composition of the WCs and the territorial jurisdiction, as well as the manner in which the WC seats are to be filled, but the local councillors are mandated members of the Committees.

As the WC was constitutionally mandated, it was a formal institution and thus, the municipality was to aid in the functioning of the Committee. WCs helped in taking the concerns of the people at the ward level to their councillors. These Committees also provided space for the people to debate the immediate needs of the area and hold the councillors accountable. Thus, they became ways of incorporating people’s participation into government decision-making from bottom up.

While states have amended their own municipal acts to reflect the changes suggested, not all changes have been adopted. This is largely because the Act explicitly mentions state legislators as the main deciding bodies for the adoption of elements of the amendment, leaving the provisions of the 74th Amendment Act and devolution of powers to city governments still a distant dream for many states.