Panchayat Finance in West Bengal and Four other States (1990-91 To 1997-98 and 2005-06 To 2012-2013): A Critical Analysis

Objectives: To analyse the performance of the Panchayat Raj Institutions (PRIs) in West Bengal and other four states during the periods from 1990-1991 to 1997-1998 and from 2005-06 to 2012-2013 in terms of receipts and expenditures and utilization rates, to analyze the sectoral allocation out of total expenditure and utilization of funds for West Bengal and other four select states and finally to make a comparative study of the trend of total revenue and total expenditure of the PRIs in these states in between two different sub-periods.

Methods: Use of trend equitation’s (both conditional and unconditional depending upon the nature of the time series data), estimation of parameters and testing were used for data analysis and interpretation. In addition, some descriptive statistical techniques of data analysis were also applied in our study to analyse data and draw conclusions.

Findings: The study revealed that the Panchayat Raj Institutions shed very little fiscal autonomy and post 73rd amendment period could not alter the situation significantly at all albeit an improvement was noticed in the state of West Bengal in both the sub-periods and for Rajasthan and Gujarat each in the first and second sub periods respectively among five select states under study. The locally raised revenues were very negligible, with a high level of financial dependence and low level of fiscal autonomy still continue and these local bodies were bereft of any trait of self-governance. The transfers were made at the convenience and mercy of both state and central governments.

Application/Improvements: The policy implications arising from the study advocate that the critical question for long term sustainability of PRIs is closely linked to the success of its own resource generation capacity as well as infusing an omission and commission free democratic set up at the grassischolar_mains level.