74th Constitutional Amendment Act – Urban Local Bodies

About:

    • The 74th Amendment Act granted constitutional status to ULBs.
    • Added Part IX A (The Municipalities) to the constitution covering Article 243(P) to 243(ZG)
    • Added Twelfth Schedule covering 18 Subjects within the functions of the ULBs.
    • Mandatory provisions:
      • Direct election of members
      • 33% reservation to women
      • Constitution of State Finance Commission (SFC) and State Election Commission (SEC)
      • District Planning Committee and Metropolitan Planning Committee

Classification:

ParameterMunicipal CorporationMunicipalityNagar Panchayat
DefinitionGoverns large citiesGoverns medium-sized towns.Governs transitional areas
Population CriteriaMore than 10 lakh1 lakh to 10 lakh.Less than 1 lakh.
Governing HeadMayor & Municipal CommissionerPresident/ChairpersonChairperson
CompositionDirectly elected members, nominated members, and ward committees.Directly elected members and nominated members.Directly elected members and nominated members.
Executive body• Standing committee
• Chairman
• Municipal Commissioner
• Standing committee
• Chief Executive Officer (CEO)
• Standing committee
• Chief Executive Officer (CEO)
Deliberative bodyCouncilCouncilCouncil
Tenure5 years5 years5 years

Problems in ULBs

Funding

    • Dependence on Central & State Transfers
    • Inefficiency in Property Tax Collection- only 10-11% from property tax
    • Limited Taxation Powers
    • Delayed State Finance Commissions

Functional

    • Proliferation of Parastatal Agencies
    • Inadequate Devolution of Powers
    • Non-functional District Planning Committees (DPCs)

Functionaries

    • Rising corruption and criminal elements in urban governance.
    • Corporator Pati Syndrome
    • Bureaucratic interference
    • Staff Shortage as 35% of municipal posts remain vacant

Functionality

    • Unplanned Urbanization
    • Poor centre-state-local cooperation hampers policy implementation.

Types of ULBs:

Types of ULBFeatures
Municipal Corporation• Governs large cities (e.g., Delhi, Mumbai, Kolkata).
• Established by State Acts or Parliamentary Acts in Union Territories.
• Three authorities: Council (elected members, headed by a Mayor), Standing Committees, and Municipal Commissioner (executive authority, appointed by the state government).
Municipality• Governs medium-sized towns and smaller cities.
• Also called Municipal Council/Committee/Board.
• Three authorities: Council (elected members, headed by a President/Chairman), Standing Committees, and Chief Executive Officer (appointed by the state government).
Notified Area Committee• Administers fast-growing towns or areas not yet qualifying as municipalities.
• Entirely nominated body (not elected).
• Functions like a municipality but is controlled by the state government.
Town Area Committee• Governs small towns with limited municipal functions (e.g., drainage, roads, street lighting).
• May be fully elected, fully nominated, or a mix of both.
Cantonment Board• Governs civilian areas in military cantonments.
• Established under the Cantonments Act, 2006 and controlled by the Ministry of Defence.
• Members are partly elected and partly nominated, with military officer as the ex-officio president.
Township• Created by large public enterprises to provide civic amenities to workers.
• No elected members; administration is managed by a town administrator appointed by the enterprise.
Port Trust• Manages port areas (e.g., Mumbai, Kolkata, Chennai).
• Created by Parliamentary Acts.
• Consists of both elected and nominated members, headed by an official chairman.
Special Purpose Agency• Handles specific functions (e.g., water supply, housing, pollution control).
• Examples: Urban Development Authorities, Housing Boards, Transport Boards, Electricity Boards.
• Not under municipalities, functions independently.

DEEM Model (Direct election of mayor)

Arguments in favor of direct election of Mayor

    • Political Legitimacy
    • Enhances citizen participation in local governance.
    • Stable and Effective Leadership
    • Less interference from state governments.
    • Global Best Practices e.g. in New York, London, Paris

Arguments against direct election of Mayor

    • Conflict with Municipal Council can lead to deadlocks and policy paralysis.
    • Lack of administrative experience
    • Weakened state government oversight
    • Politicalization of urban governance

Current Status in India

    • Some states have directly elected Mayor: Madhya Pradesh, Chhattisgarh, Rajasthan (some cities).
    • In 2021, Madhya Pradesh reintroduced direct elections for Mayors after switching to indirect elections in 2015.
    • Delhi has indirectly elected Mayor, leading to governance issues due to conflicts between Mayor and state government.

Way forward

    • Decentralization of Powers
    • Improve Financial Management
    • Capacity Building
    • Strengthen collaboration with government, civil society, and private sector.
    • Encourage citizen advisory boards, town hall meetings, and feedback mechanisms.
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