Panchayats and municipalities: the 73rd and 74th Amendments

India has roughly a quarter of a million panchayats and several thousand urban local bodies, and together they elect millions of representatives — among them more than a million women. That scale exists because of two amendments passed in 1992. Before them, local government depended entirely on the will of each state; after them, it had a constitutional floor.

The road to 1992

Local self-government had been in the Constitution from the start — but only as a Directive Principle (Article 40), unenforceable and widely neglected.

The 73rd Amendment: panchayats (Part IX, Articles 243–243O)

Compulsory provisions

These must be followed by every state:

• Gram sabha (Article 243A) — the body of all registered voters in a village.
• Three-tier system at village, intermediate and district levels — except that states with a population below 20 lakh need not have the intermediate tier.
• Direct elections to seats at all levels.
• Five-year term; if dissolved early, elections within six months.
• Reservation for SCs and STs in proportion to their population.
• Reservation for women of not less than one-third of seats and of chairperson posts. Many states have gone further and reserve 50 per cent.
• State Election Commission (Article 243K) to conduct elections.
• State Finance Commission (Article 243I) every five years to review panchayat finances.

Voluntary provisions

Left to each state:

• which functions to devolve, from the 29 subjects listed in the Eleventh Schedule (agriculture, minor irrigation, drinking water, rural housing, primary education, health, poverty alleviation and others);
• which taxes, fees and grants to assign;
• reservation for backward classes;
• representation of MPs and MLAs in panchayat bodies.

The 74th Amendment: municipalities (Part IXA, Articles 243P–243ZG)

Parallel provisions for urban areas:

• Three types of bodies: nagar panchayat (area in transition from rural to urban), municipal council (smaller urban area) and municipal corporation (larger urban area).
• Direct elections, a five-year term, reservations for SCs, STs and women on the same pattern.
• Wards committees for municipalities above a population of three lakh.
• The Twelfth Schedule lists 18 functions — urban planning, regulation of land use, roads and bridges, water supply, public health and sanitation, slum improvement, urban poverty alleviation and others.
• District Planning Committee (Article 243ZD) to consolidate plans of panchayats and municipalities.
• Metropolitan Planning Committee (Article 243ZE) for metropolitan areas.

PESA, 1996

The 73rd Amendment did not automatically apply to Fifth Schedule (scheduled) areas. The Panchayats (Extension to the Scheduled Areas) Act, 1996 extended it with modifications, giving gram sabhas in these areas special powers — over minor forest produce, land alienation, local markets and consultation before land acquisition — in keeping with tribal customs.

Implementation has been uneven; several states took years to frame rules under it. PESA remains central to GS II and GS III questions on tribal rights and left-wing extremism.

The 3Fs: funds, functions, functionaries

The standard way to assess devolution is to ask whether local bodies have:

• Functions — real authority over the subjects in the Eleventh and Twelfth Schedules, not just a list on paper;
• Funds — their own revenue (property tax, fees) plus predictable transfers from states and the Finance Commission;
• Functionaries — staff who report to them, not to line departments.

In most states, devolution is strongest on functions on paper and weakest on functionaries. Local bodies often have responsibilities without the staff or money to meet them.

Persistent problems

• Weak finances — low own-source revenue; heavy dependence on grants; State Finance Commissions constituted late or their reports ignored.
• Parallel bodies — district-level agencies and scheme-specific committees that bypass elected bodies.
• Proxy representation — elected women represented in practice by male relatives (the "sarpanch-pati" phenomenon), though evidence also shows reservation has increased women's participation and changed public spending priorities in many places.
• Delayed elections — especially of urban bodies, sometimes for years.
• Capacity — limited training and technical support for elected representatives and staff.
• Urban governance — mayors in many cities have limited executive power; planning is often controlled by state-level development authorities.

Reforms often proposed

• Activity mapping in every state — clearly assigning each function to a level of government.
• Timely, empowered State Finance Commissions, and devolution that is formula-based and predictable.
• Stronger own-source revenue, especially property tax in cities.
• Dedicated cadres of staff for local bodies.
• Empowered mayors with fixed terms in larger cities.
• Regular social audits and active gram sabhas to strengthen accountability.

Practice questions

1. Prelims-type: How many subjects are listed in the Eleventh and Twelfth Schedules? Which states are exempt from having an intermediate tier of panchayats?
2. Mains-type (150 words): What is the significance of PESA, 1996 for self-governance in scheduled areas?
3. Mains-type (250 words): "Three decades after the 73rd and 74th Amendments, local governments in India have responsibilities without resources." Critically examine.