UPGRADATION GRANTS
8.1 Para 4(iv) of the Presidential Order constituting our Commission stipulates that recommendations may be made taking into consideration, inter alia, "the requirements of States for modernization of administration ......... and for upgrading the standards in non-developmental sectors and services, and the manner in which such expenditure can be monitored." The aspects of administration requiring modernization have been further amplified, using illustrations of computerization of land records and providing faster channels of communication upto and above the district level. Being illustrative, however, the examples cannot be construed to mean that these must necessarily be taken up or to preclude consideration of any other aspect of administration.
8.2 The requirement of upgrading standards of State administration, as a specific consideration underpinning the recommendations of Finance Commissions, appeared for the first time in the terms of reference of the Sixth Commission. Much before that, however, the First Commission had in their report discussed in detail the need for general and specific grants. In para 16 of Chapter VII of their report, the First Commission recorded "We believe that both the methods of conditional and unconditional grants should have their part to play in the scheme of assistance by the Centre. Unconditional grants should reinforce the general resources of the State Governments, which they would be free to allocate among competing purposes according to their best judgement, subject to the usual administrative and parliamentary checks. Grants for broad purposes may be given to stimulate the expansion of particular categories of services rather than specified schemes under those categories." Thus, in pursuance of its belief that primary education needed to be encouraged, the First Commission recommended, without being specifically asked to do so, grants for primary education to eight States in proportion to the number of children of school going age not attending schools till then.
8.3 The Third Commission , likewise, took a view that impetus should be given to the development of communications to open up backward areas The Commission, therefore, recommended grants for the development of communications.
8.4 By the time the Sixth Commission was set up, it was realised that the upgradation of standards of administration required to be looked into by the Finance Commission. Accordingly the terms of reference of successive Finance Commissions, from the Sixth to the Eighth, require them to consider the need for upgradation of standards of state administration in one form or the other.
8.5 The terms of reference of the three Commissions refer to the need for upgrading the administration in `backward' States with a view to bringing them to the level of more advanced States. The Sixth Commission wanted the standards of general administration in backward States to be brought to the "levels obtaining in the more advanced States over a period of ten years". The Seventh Commission confined the upgradation of standards in backward States to "non-developmental sectors and services" but introduced a more up-to-date comparison with more advanced States i.e. "over the period covered by the report of the Commission." The terms of reference of the Eighth Commission reiterated the requirement of upgradation of standards in "non- developmental sectors and services" to bring them to the "levels obtaining or likely to obtain" in the more advanced States. Unlike the terms of reference of the Sixth and Seventh Commissions, which referred only to the States "which are backward", the Eighth Commission was required to consider the need for upgradation of States in general and `in particular' of States which are backward. The Seventh and Eighth Commissions also introduced the element of monitoring of expenditure on upgradation. The terms of reference of the Ninth Commission did not require it to consider upgradation of the standards of administration.
8.6 The Sixth Commission drew a distinction between the need for making a `provision' for upgradation of State administration and `entitlement' of a State to receive the grant. In broad terms, the provision needed was worked out on the basis of per capita expenditure needed to bring the services in selected items of administration to the level of all States average by 1978- 79. This was added to the expenditure estimates of States for the award period. The entitlement to a grant arose only if the result of the aforesaid exercise showed a revenue gap. The Sixth Commission had "concerned itself only with expenditure on revenue account and not on capital and loan accounts" though it had averred that it could deal with all the requirements of the States for upgradation of standards of administration including social services. The Seventh Commission examined the relative position of States in physical terms and made an assessment of the need for the upgradation of standards in terms of the norms set by it. The Seventh Commission also felt that it was open to them to recommend grants for capital expenditure apart from grants for revenue expenditure under article 275. The Commission did not recommend any grants to revenue surplus States. It felt that the revenue surplus States could, of their own, upgrade their standards of administration. The Eighth Commission also did not recommend any grants for upgradation of services to Gujarat, Haryana, Karnataka, Maharashtra, Punjab and Tamil Nadu as they had a sufficiently large surplus before devolution of taxes. The Ninth Commission was also required by its terms of reference to keep in view the special problems, if any, of each State. Accordingly, the Commission made recommendations in its first report regarding special problems in some of the States. Earlier, the Eighth Commission had also recommended grants for special problems in some States.
8.7 A statement indicating amounts recommended by the Eighth and Ninth Commissions, amounts approved by Inter- Ministerial Empowered Committee (IMEC) and releases made is at Annexure-VIII.1.
8.8 The aspirations of all the States in wishing to attain higher standards of administration in various sectors are reflected in the numerous proposals we have received. Together, the proposals amount to Rs. 1,17,519.77 crores. The
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special problems alone account for 41.7 per cent of the total amount.
8.9 It is obviously not possible for us to cover all the areas in which the States would like to improve their existing standards of services. Computerization of land records is one of the areas we are expected to look at. We discussed the possibilities in this regard with the Ministry of Rural Development and the National Informatics Centre (NIC) and were advised that the Eighth Plan already had a scheme for this purpose. We saw the implementation of this scheme of computerization of land records in several districts. By 1993-94 its coverage included 75 districts. 300 districts are scheduled to be covered by the end of the Eighth Plan and the remainder by the turn of the century. In view of this we decided not to pursue this matter further.
8.10 There is also a mention in our terms of reference of the need for providing faster channels of communication upto and above the district level. This has several dimensions. Telecommunication links are already fairly well spread-out and are being strengthened and made faster and more reliable with the help of technological advances and the participation of private industry. We understand that the Department of Telecommunications plans to link all district headquarters on the telex network and through digital media. The NIC has also established a country-wide network, called NICNET. Police communication, however, remains a weak area. We have dealt with this aspect while considering the upgradation of facilities for the police.
8.11 In identifying areas of upgradation, we have been largely guided by such considerations as their relevance and importance to administration and society, neglect across States and the long-term deleterious consequences If no remedial action is taken soon. State specific special problems have also been considered. On this basis, we have selected the following areas for upgradation :
A. District Administration
i) Police ii) Fire services iii) Jails iv) Record rooms v) Treasuries and Accounts
B. Education: i) Promotion of girls' education ii) Additional facilities for upper primary schools iii) Drinking water facilities in primary schools
C. Special Problems
8.12 Upgradation grants are not being recommended for those States which have been assessed to have an overall non- plan revenue surplus before devolution. In our view it is not only desirable but also necessary and possible for these States to give from their own resources priority allocation to the areas needing upgradation.
8.13 The need for such grants in respect of items under A and B in para 8.11 is examined as follows
A. District Administration:
i) Police Our proposals on this subject as well as fire services and jails have been formulated on the basis of information received from the States and in consultation with the Ministry of Home Affairs.
(a) Buildings for Police Stations/Out-posts : According to available data, there is an acute shortage of buildings for police stations and out-posts in almost all the States. As on 1st January 1993, there were 12,064 police stations and 5,899 out-posts in all the States. Out of these, 4,246 police stations and 3,002 out-posts did not have proper accommodation. Many of these operate from temporary sheds and tents. There is also a shortage of separate lock-up rooms for women. Such deficiencies are a drag on the operational efficiency of the police. We have assessed a requirement of Rs.28.76 crores to cover at least 10 per cent of the existing shortage of buildings for police stations/out-posts at an average cost of Rs.4 lakhs per building.
(b) Police Housing (Family Accommodation): Housing facility for the lower subordinate staff in the police is inadequate at present. While the all-States' average satisfaction level was of the order of 30.09 per cent, as on 1st January 1993, it was much lower in the case of several States; the lowest being 6.29 per cent in the case of Assam. We accept that a redressal of this situation is necessary as housing satisfaction has a bearing on the general levels of police performance. We feel that at least a minimum of 20 per cent satisfaction level should be reached in respect of all the States. Fourteen States fall in this category. In calculating the amounts required we have worked out the unit cost as Rs.1.25 lakhs for family accommodation with a plinth area of 435sq. ft. at the rate of Rs.285 per sq. ft. The requirement thus worked out for fourteen States is Rs.375.61 crores.
(c) Police Training: We find that training facilities for police personnel continue to be inadequate. We consider that investment in training is essential and have therefore assessed a requirement of Rs.56.47 crores for upgrading the facilities for training of subordinate police personnel in the States. The detailed schemes may be formulated by States in consultation with the Ministry of Home Affairs. The assessment made by us is on the basis of weightage assigned to population, strength of police personnel, and crime per lakh of population in the proportion of 30, 50 and 20 respectively.
(d) Police Telecommunication The importance of police telecommunication can hardly be over-emphasized. It has been brought to our notice that the scheme of POLNET seeks to upgrade the existing police telecommunication system and also extend it to rural and remote areas, at an approximate cost of Rs. 154.20 crores. This cost, estimated by the Ministry of Home Affairs, is to be shared by both the Central and State Governments. The non-recurring amount of the share of States works out to Rs. 94.38 crores and the recurring cost as Rs.11.07 crores. To facilitate quick implementation of the scheme, it is considered necessary to provide for the non-recurring cost of the share of States which are eligible for upgradation grants.
ii) Fire Services With growing industrialization, urbanization and development of congested markets, fire hazards have increased manifold. The development of fire services has not made commensurate headway. We are convinced that it would be prudent for States, to strengthen and upgrade fire fighting capabilities. This would include adequate and suitable modern equipment, effective fire call communication system, rescue equipment, training of manpower, well designed functional fire stations, adequate water availability and protective equipment
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for functionaries etc. The total requirement of funds needed for this purpose is assessed as Rs. 100 crores for all the States.
iii) jails Proposals have been received from States urging improvement of facilities in jails. It is hidden from none that the prevailing conditions leave much to be desired. We are aware that plan funds are available for this sector; the amounts, however, are not sufficient to make an appreciable dent on the problem. We have, therefore, provided Rs. 50 crores for repair and renovation of the existing accommodation for prisoners and Rs.30 crores for medical equipment, consumable items and sanitation, in the ratio of the capacity of jails in different States. The amounts provided for in respect of medical care etc. may be so used that not less than the proportionate allocation for female prisoners is ensured in each jail.
iv) Record Rooms Records are an important part of administration. They are required to be referred to time and again, over long periods, by different agencies. In districts, they are necessary for the proper and efficacious functioning of administration. Unfortunately, in most places the upkeep of records is in poor state and needs to be improved. Considering that in the districts, revenue records are crucial to the welfare of the large rural population, we have assessed the requirement under this sector based on estimates of operational holdings in a State and the area covered by them. Accordingly, we have assigned 60 per cent weightage to operational holdings and 40 per cent to area in arriving at the State-wise requirement. We have used the data for 1990-91. In respect of Assam, Bihar, Jammu & Kashmir, Meghalaya and Sikkim, information is available only upto 1985-86. We have therefore projected these on the basis of average growth rates of operational holdings/area in other States, to arrive at the figures for 1990-91. The averages have been taken separately for special category and non-special category States. We have thus assessed a requirement of Rs.100 crores for construction of/ addition to record rooms and provision of ancillary equipment for modernization. This provision will not be available for staff.
v) Treasuries and Accounts We have received proposals from several State Governments in respect of the creation of new treasuries/sub- treasuries, construction of new buildings, purchase of furniture, office equipment, racks, almirahs, computers, data entry machines, provision for staff, imparting of training etc. The Commission's attention has also been drawn towards considerable delays in rendition of accounts for reasons of lack of adequate and skilled staff, mechanical aids etc.
We are not inclined to support staff proposals or proposals for expenditure on normal expansion or equipping of treasuries. States should be able to deal with such items on their own. We are, however, of the view that computerization of district treasuries would go a long way in improving the managerial control of both the State and district level administration. It would also make for speedy and accurate generation of accounting information that might be needed for purposes of better planning, budgeting and monitoring. Information regarding the number of district level treasuries and the state of computerization thereof, has been obtained from the off ice of the Comptroller and Auditor General of India, Accountants General, NIC and States. Computerization of treasuries has been found to be at various stages in different States. While some of the States have achieved computerization of all treasuries, others are still to do so. Many have not embarked on computerization as yet. We have taken the view that at least all the district level treasuries should be computerized. We have, for this purpose, assessed a requirement of Rs. 23.10 crores at an average unit cost of Rs. 10 lakhs per treasury. The details of the latter are indicated in Annexure VIII.2
A statement showing State-wise requirement for each sector under District Administration is given in Table 1.
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Table 1
Requirement for Upgradation of District Administration
(Rs. Lakhs)
State Building for Police Police Police Fire Jails Record Computeri- Total
Police Stati- Housing Training Telecomm- Services Rooms station of (2 to 10)
ons/Outposts unications Repairs and Medical Treasuries
Renovation Facilities
1 2 3 4 5 6 7 8 9 10 11
Andhra
Pradesh 204.00 --- 401.51 683.00 400.00 257.00 154.00 871.83 --- 2971.34
Arunachal
Pradesh 32.00 537.50 10.96 163.75 200.00 --- --- 13.65 60.00 1017.86
Assam 68.00 8291.25 179.81 374.50 200.00 154.00 92.00 226.67 230.00 9816.23
Bihar 504.00 5267.50 524.73 919.25 700.00 587.00 353.00 989.19 400.00 10244.67
Goa 20.00 --- 10.21 44.75 200.00 7.00 4.00 5.73 20.00 311.69
Gujarat 240.00 --- 291.62 399.50 500.00 135.00 81.00 446.37 --- 2093.49
Haryana 100.00 3611.25 124.23 246.50 200.00 90.00 54.00 175.68 --- 4601.66
Himachal
Pradesh 32.00 1471.25 43.89 178.75 300.00 14.00 9.00 71.99 20.00 2140.88
Jammu &
Kashmir 32.00 2466.25 84.54 214.25 300.00 32.00 19.00 98.02 150.00 3396.06
Karnataka 112.00 --- 273.27 429.00 300.00 190.00 114.00 622.46 --- 2040.73
Kerala 128.00 1028.75 192.24 322.25 300.00 140.00 84.00 348.42 --- 2543.66
Madhya
Pradesh 140.00 --- 449.07 889.25 800.00 414.00 248.00 1006.52 --- 3946.84
Maharashtra 172.00 --- 571.32 611.50 1000.00 441.00 264.00 1038.04 --- 4097.86
Manipur 28.00 1382.50 26.46 124.25 200.00 43.00 26.00 12.21 --- 1842.42
Meghalaya 8.00 --- 22.14 107.50 200.00 14.00 8.00 17.95 50.00 427.59
Mizoram 12.00 282.50 11.89 58.75 100.00 15.00 9.00 5.46 30.00 524.60
Nagaland 28.00 1606.25 31.72 122.25 200.00 30.00 18.00 31.36 90.00 2157.58
Orissa 120.00 200.09 399.50 400.00 182.00 109.00 350.00 180.00 1940.59
Punjab 68.00 6271.25 185.55 312.00 300.00 180.00 108.00 160.22 140.00 7725.02
Rajasthan 124.00 --- 288.63 581.00 500.00 212.00 127.00 793.66 340.00 2966.29
Sikkim 16.00 38.75 5.93 68.75 200.00 1.00 1.00 4.84 10.00 346.27
Tamil Nadu 220.00 --- 369.62 623.50 400.00 467.00 280.00 630.52 --- 2990.64
Tripura 8.00 818.75 30.63 62.25 100.00 20.00 12.00 25.33 20.00 1096.96
Uttar
Pradesh 224.00 --- 907.62 1149.25 1200.00 886.00 532.00 1563.75 460.00 6922.62
West Bengal 236.00 4487.50 409.67 352.50 800.00 489.00 294.00 490.13 110.00 7668.80
Total 2876.00 37561.25 5647.35 9437.75 10000.00 5000.00 3000.00 10000.00 2310.00 85832.35
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B. Education :
i) Promotion of Girls' Education There is a strong correlation between rise in female literacy and the decline in fertility and infant mortality rates. Low female literacy has been a source of many other social ills. While much has been achieved in the sphere of education through planned effort, girls education continues to lag behind. It is, therefore, felt that the States which have very low female literacy rates may be assisted by upgradation grants for specific districts. Thus, 83 districts where female literacy rates were below 20 per cent and 199 districts with rates between 20 and 40 percent in 1991, have been identified for upgradation grants. The assessment has been made on the basis of Rs.20 lakhs and Rs. 10 lakhs respectively per district per year. The total requirement works out to Rs. 182.50 crores.
ii) Additional facilities for upper primary schools: On the basis of the Fifth All India Educational Survey (AIES,1986, published in 1992) only 67 per cent of the upper primary schools had drinking water facilities. We feel this percentage should be raised to at least 80 percent. Even more important is the necessity of providing for separate toilet facilities for girls at the upper primary level to ensure that they do not discontinue education for want of basic amenities. The present availability of this facility is of the order of 12.7 per cent. We feel that in the interest of promoting girls education it is necessary to reach a level of at least 75 percent satisfaction in this regard by the year 2000. The number of girls and co-educational schools in 1993 have been arrived at by applying the ratio prevailing in 1986 to the total number of schools in each State. The same unit cost of drinking water facility has been taken as in the case of primary schools; the unit cost for low-cost sanitation has been taken as Rs. 10,000. Accordingly a total requirement of Rs. 1 16.93 crores has been estimated.
iii) Drinking water facilities in primary schools: As per the Educational Survey (referred to above) only 52.8 per cent of primary schools had drinking water facilities. For some States, the percentage was even lower. In view of the abysmally low levels of such a basic and essential facility, we have decided to provide upgradation grants for drinking water in all primary schools of the country. We have arrived at the number of schools requiring this facility by applying the ratio obtaining in AIES 1986 to the number of schools in 1992-93 in each State. At an average unit cost of Rs. 15000 for a hand pump, we have assessed a requirement of Rs.456.32 crores.
A statement showing State-wise requirement for upgradation in the educational sector is given in Table 2.
Table 2
Requirement for Upgradation of Education
(Rs. Lakhs)
States Girls Education Upper Primary School Primary Total
School Col. 4
Female Literacy in Distt. Drinking Toilets Total 7 and 8
Water for Girls
Less than Between Total Drinking
20% 20%-40% Water
1 2 3 4 5 6 7 8 9
Andhra Pradesh 200.00 850.00 1050.00 144.75 391.70 536.45 4329.84 5916.29
Arunachal Pradesh 300.00 400.00 700.00 6.60 17.90 24.50 89.30 813.80
Assam --- 500.00 500.00 289.05 415.10 704.15 3665.44 4869.59
Bihar 1800.00 1100.00 2900.00 61.50 884.40 945.90 4221.96 8067.86
Goa --- --- 1.80 6.20 8.00 59.30 67.30
Gujarat --- 150.00 150.00 255.00 1048.10 1303.10 949.31 2402.41
Haryana --- 350.00 350.00 --- 72.70 72.70 211.95 634.65
Himachal Pradesh --- 200.00 200.00 28.35 71.50 99.85 562.33 862.18
Jammu & Kashmir 1000.00 200.00 1200.00 173.55 86.70 260.25 1020.72 2480.97
Karnataka --- 450.00 450.00 333.15 1083.30 1416.45 1962.89 3829.34
Kerala --- --- --- 37.20 162.20 199.40 239.87 439.27
Madhya Pradesh 1000.00 1450.00 2450.00 478.20 759.40 1237.60 7003.02 10690.62
Maharashtra --- 450.00 450.00 462.45 1152.80 1615.25 3391.73 5456.98
Manipur --- 200.00 200.00 32.55 44.80 77.35 353.99 631.34
Meghalaya --- 100.00 100.00 44.25 48.30 92.55 551.46 744.01
Mizoram --- --- --- 43.05 35.50 78.55 109.46 188.01
Nagaland --- 50.00 50.00 19.35 22.00 41.35 146.77 238.12
Orissa 200.00 400.00 600.00 641.55 841.10 1482.65 4656.16 6738.81
Punjab --- 150.00 150.00 --- 68.90 68.90 186.99 405.89
Rajasthan 1900.00 400.00 2300.00 50.10 386.60 436.70 2284.34 5021.04
Sikkim --- 50.00 50.00 4.65 8.30 12.95 46.79 109.74
Tamil Nadu --- 150.00 150.00 --- 248.40 248.40 695.53 1093.93
Tripura --- 50.00 50.00 18.00 31.10 49.10 194.34 293.44
Uttar Pradesh 1900.00 1900.00 3800.00 148.65 334.40 483.05 5548.63 9831.68
West Bengal --- 400.00 400.00 7.50 190.70 198.20 3149.63 3747.83
Total 8300.00 9950.00 18250.00 3281.25 8412.10 11693.35 45631.75 75575.10