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Discuss the issues of fiscal independence specific to urban local bodies. Also, make some suggestions to improve local finance and account in what way extant fiscal illusion is a great deterrent to mobilisation.

Topic : Functions and responsibilities of the Union and the States, issues and challenges pertaining to the federal structure, devolution of powers and finances up to local levels and challenges therein.

1. Discuss the issues of fiscal independence specific to urban local bodies. Also, make some suggestions to improve local finance and account in what way extant fiscal illusion is a great deterrent to mobilisation. (250 words)

Reference: Financial Express 

Why the question:

The author presents to us the financial difficulties that the urban local bodies are facing in the current times.

Key Demand of the question:

One must bring out the issues of fiscal independence specific to urban local bodies. Also, make some suggestions to improve local finance and account in what way extant fiscal illusion is a great deterrent to mobilisation.

Directive:

Discuss – This is an all-encompassing directive – you have to debate on paper by going through the details of the issues concerned by examining each one of them. You have to give reasons for both for and against arguments.

Structure of the answer:

Introduction:

Briefly talk about the urban local bodies, their mandate, functioning with special emphasis on their fiscal factor.

Body:

It is quarter century since the creation of municipalities under 74th Constitutional Amendment Act. It is imperative at this juncture to assess the progress of municipal governance in India.

Discuss the concerns associated with special focus on fiscal mobilisation.

Suggest what needs to be done to overcome the issue of the extant fiscal issues.

Explain that the stable source of revenue for the local government bodies whether from their own sources or in the form of grants should lie at the heart of efforts to empower them.

Conclusion:

The present model of urban governance vesting power in a singular municipality should be relooked. Urban governance reforms should focus on political empowerment of local government that promotes local democratic accountability.

CategoriesINSIGHTS