States demand more central funds

Most chief ministers yesterday demanded more money from the Centre to strengthen panchayati raj institutions, and barring a few states, said that provision of drinking water, roads, employment, credit and rural housing could be carried out by the panchayats themselves.

They were speaking at the first chief ministers' conference on rural development and panchayati raj convened after the United Progressive Alliance (UPA) government came to power at the Centre.

Rajasthan Chief Minister Vasundhara Raje charged the UPA government with undermining state governments by attempting to provide funds directly to panchayats.

However, in his speech, Karnataka Chief Minister Dharam Singh, made a strong case for strengthening panchayati raj institutions and treating them as units for devolution of power, both economic and administrative.

But the refrain of many chief ministers including Rabri Devi of Bihar, was that the panchayat-level institutions had not come into their own yet, and needed the support of the state government to carry out development and asset creating activities.

"Most of the work being done by the panchayats are temporary in nature and till these local bodies come out of ad hocism, they will need the support of the state government for the selection of different programmes," she said.

Haryana Chief Minister OP Chautala said: "Panchayati raj bodies will be encouraged if they are provided with funds in addition to those given approval by the rural development ministry. This will help in enhanced focus on development projects and more benefit to the poor."

"Scheme-wise allocation by the rural development ministry and the plan panel should be stopped. There should be devolution of funds earmarked for rural areas by the Centre to panchayati raj institutions," Singh said.

He said expectations of rural people were increasing and there should be a paradigm shift in the approach towards rural development.

"Let the ministry and the Planning Commission work out a formula in consultation with the state governments to share central aid earmarked for rural development among various states based on need-based performance," he said.

Several chief ministers demanded a more equitable distribution of resources between the Centre and the state meant for rural development. Chautala said: "The Haryana government annually collects around Rs 300 crore as diesel cess, of which 50 per cent should be given to the state as part of the Prime Minister rural road programme."