Rationality in District Plan Resource Allocation
Decentralized development process was initiated by the government way back in 1976-77 and the state was pioneer in the country in pursuing growth centre strategy through micro level planning process. In fact, after implementation of first three plans at the national level, wider disparities between the states in growth and development made the decision making bodies to realize that a balance has to be maintained between national priorities and local needs.
Therefore, the fourth plan 1969-74 gave greater focus to planning at district level and attempted to evolve a strategy at grossroots level based on a growth centre concept.
The Jammu and Kashmir State was pioneer in initiating the decentralized development process popularly known as ‘Single Line Administration with twin objectives: (a)making planning more reflective of hopes and aspirations of common man; (b) ensuring speedy implementation of development programmes’ The District development Boards were constituted for institutionalization of district development process that included the plan resource allocation and became a reality from the execution of fifth fiver plan. But the plan resource allocation was more or less subjective and value judgment based by the Planning Department than any optimization solution-driven. It was PDP-Congress coalition government which desired to have district plan resource allocation based on rational criteria to address to development disparities both inter-regional and intra-regional often political plank of politicians in the state.
The then coalition government constituted a statutory Jammu and Kashmir State Finance Commission 2007-10 by enactment in 2006 with underlying preamble, “An Act to provide for ensuring equitable development for all regions in the State by equitable distribution of resources available for development at regional and district levels in the State of Jammu and Kashmir” (J&KSFC Act 2006). In the recent District Development Board meetings the government claims that it has approved, “structured schemes of financing district plans” which, of course, is in contravention to the optimization solutions based on UNDP methodology suggested by J&K State Finance Commission, 2010. The NC-INC coalition government evaded the implementation of the district plan resources on SFC criteria for no reason and followed the routine ritual during its tenure at the cost of district development. This is not expected from the ruling coalition as one of the coalition partners constituted the statutory commission at a financial cost of Rs 1.04 crore.
It shows that an arbitrary decision making, particularly in district development funding does more suit the political interests than the primary objectives of public aspirations and hopes underlying the philosophy of Single Line Administration envisaged in 1976 policy of decentralization.
Regional disparities and plan resource allocation
One of the slogans that political leaders have been exploiting, particularly since sixties, in the state is the so-called regional disparities in development and growth. Each region has substantiated its claim in the past as well as at present to have been ignored and discriminated against in the share of plan resources and hence lags behind.
On realizing the gravity of regional claims earlier an inquiry commission was appointed by the Government of Jammu and Kashmir in consultation with the central government under the Chairmanship of Dr P.B.Gajindergadkar in 1967 and the said commission, after analyzing the second and third plan data concluded that,” an overall assessment and leaving out of account unallocable part of expenditure cannot be said to have been unequally shared between the Jammu, and Kashmir regions.
There does not, therefore, seem to be justification for the complaint of their having been deliberate discrimination exercised against either region” (p 26). Over the years the regional aspiration could not overcome dissatisfaction, despite state intervention programmes from time to time, the perceptions and complaints continued to resurface from regions of the state, thereby re-enforcing the government to appoint yet another commission popularly called Justice Sikri Commission to look in to the regional grievances.
The commission in its report recommended in some districts of Peerpanchal and some districts of valley and Ladakh few intervention programmes on priority. However, the claims and counter claims of the regional discrimination continued by regions and political groups which SFC addressed in depth and made an attempt to set the controversy finally to rest.
The commission analysed the district plan expenditure region-wise from 1976-77 fiscal to 2006-07 and arrived at a finding that 42.69 percent expenditure were accounted for by Jammu region while 43.69 percent by Kashmir region and Ladakh 13.82 percent during the period under reference. Therefore, one does not find inequity in inter se distribution resources between the regions. Thus, the question of discrimination does not arise as far as the district plan resource allocation is concerned and the resources distribution tend to be equitable except the earlier years of VIII plan when it was more tilted to Jammu region.
The commission further analysed the state sector plan allocations and expenditure for which the region-wise break-up was available, approximately 85 percent of plan funds, except the joint sectors which are common beneficial to all regions like power, forests, science and technology, human resource, etc. Aggregating the plan expenditure from 1992 to 2007,(VIII plan to X plan period) the commission established that the Jammu region accounted for 41.69 percent of the resources while the Kashmir region showed 49.94 percent, slightly higher because of structural reasons, that is, existence of historically inherent tourism sector and irrigation and Ladakh region has shared the 8.37 percent.
Ranking of districts in development and deprivation
The degree of development is bifurcated in to three broad sub-sector indices, that is, Agricultural Development Index (ADI), Social Development Index (SDI) and Economic Welfare Index (EWI) and arithmetic mean of sum of these indices provide aggregate level of development of each district and region and are also ranked accordingly.
While the district Jammu ranks on the top of development with ADI value 0.4801 followed by Srinagar with aggregate development index value 0.4562, Pulwama having ADI value 0.4471 and Kathua 0.4262. The districts like Doda, Kupwara, Leh and Kargil stand at the tail-end in realizing the fruits of growth and continue to be most deprived districts with their ADI values 0.3213, 0.3346, 0.3311 and 0.3411 respectively.
While the district Kargil ranks at the bottom in educational development in 1980-81 with EDI value 0.0781 it emerges on 10th rank by the end of X plan with index value 0.2659. Today the districts like Rajouri, Udampur, Kupwara and Budgam are most deprived districts in educational development, while district Poonch, Leh, Rajouri and Pulwama are the most deprived districts in healthcare according to their respective index values (SFC Report 2010).
Therefore, while the two districts Jammu including Samba and Srinagar including Ganderbal rank on the top of existing level of development, the two districts Pulwama and Kathua emerge in the middle rank. The most deprived districts, based on their respective sectoral and aggregate index values, in Jammu region emerge Doda including Kishtawar and district Kupwara including Bandipore in Kashmir region.
Thus, the deprivation is equally distributed between the regions. Even in human development index (HDI), the district Jammu (HDI value 6969) and district Srinagar (HDI value 0.6602) rank on the top, while district Pulwama and Kathua rank in the middle and district Kupwara and Doda rank at the bottom in human development. Thus, the slogan of growth of one region at the cost of other region and relative disproportionate distribution of plan funds between the regions is established a myth.
Entitlement of district for plan funds
The State Finance Commission 2007-10, mandated by its terms of references, conducted in-depth analysis of socio-economic indicators and interacted with development administration general public and other stakeholders in all districts and vulnerable blocks.
The commission also examined the methods and approach for allocation of plan funds to districts and devolution of resources upon local bodies in the states of West Bengal, Maharashtra, Uttarakhand, Karnataka, Andhra Pradesh, Madhya Pradesh, Goa State and U.P, besides the 11th and 12th Union Finance Commissions. It analyzed 45 social and economic indicators using unchallengeable UNDP approach and methodology to arrive at levels of development and deprivations in the districts and estimated, thereby the degree of district development in terms of sub-sectoral indices, sectoral indices and estimated a composite index of development and deprivation for each district for the period 1980-81 and 2006-07.
Taking into account population, area and degree of district development/degree of deprivation, the commission established entitlement of each district in allocation of plan resources based on differential weight-age given to each parameter, that is, in case of area 20 percent, population 35 percent and degree of deprivation 45 percent including 5 percent a special dispensation for newly carved out districts. Based on the said mechanism the districts in Jammu region, with their respective entitlements, are allocated 42.96 percent of plan funds, the Kashmir region 43.33 percent and Ladakh region 13.71 percent of the total plan funds in-order to ensure equity in the distribution of resources. The same principle can be followed for devolution of plan resources at block level and upon local bodies.
The District Development Boards, instead of fixing the sectoral priorities based on SFC principle, continue to observe a routine ritual of holding district broad meetings and allocate plan funds arbitrarily rather than pursue criteria of equity and entitlement.
The Author is a former member J&K State Finance Commission