WB is knocking on the doors of WB! West Bengal’s Left Front government has approached the World Bank for funds. Concerned about its sliding popularity, even in rural areas, the government of West Bengal plans to strengthen the rural service delivery system with a $200 million soft loan from the World Bank.
At its last meeting with Bank officials in the last week of December, the broad outlines of the Improved Service Delivery by Panchayats (ISDP) project was agreed upon by both sides. The proposal has been forwarded to the Centre for its approval.
According to official sources, the project proposal is now at the Free Appraisal Mission stage. By mid-February the design of the entire project will be finalised and then the World Bank will give its final clearance after the proposal is vetted in its Board meeting in April. According to state government sources, the soft loan being negotiated with the World Bank will attract no interest and only 0.7 per cent service charge will be levied on it. The repayment of the loan will begin after 10 years for a 40 years period.
After the recent electoral setbacks, the state government's poor performance in implementing various centrally sponsored pro-poor programmes (such as NREGP or 100 days work, Indira Awas Yojana) has drawn flak from various quarters. The CPI(M) state committee also came to the conclusion while reviewing the successive electoral debacles that much of the disenchantment of the poor in rural Bengal with the Left is due to the non-performance or poor performance of the government’s service delivery system by Panchayats.
In this context, the government of West Bengal has taken initiatives to strengthen the panchayat system at the grass root level. As a first step, the government will target to strengthen 1,000 gram panchayats (roughly 27 per cent of the total GPs in the state).
The overall vision surrounding the ISDP’s development and design is to develop a block grant system which incentivises improved local government performance of Gram Panchayats as an integral part strengthening the broader Panchayat Raj Institutions’ (PRI) fiscal framework in West Bengal. The ISDP constitutes the initial step through which such a system can be introduced.
While significant sums will ultimately be invested in local infrastructure and service-delivery, the key development objectives of the project are institutional in character and focus on strengthening the overall functioning and accountability of targeted GPs rather than purely on physical asset creation.
The project will have three core components. First, a block (untied) grant flow from the state government will go directly to 1,000 Gram Panchayats to support local development and service delivery activities. The discretionary grant will be structured in a way to provide an incentive for strengthening institutional capacities and performance of the targeted GPs, and deepening bottom-up accountability.
Second, support for capacity-building focusing on the provision of training, the development of institutional systems (such as improved financial management systems); the roll-out of participatory planning processes will be created. It should be noted that the state government has already begun a PRI capacity-building programme using funds from its own and donor sources.
The project will supplement this programme in areas where additional resources are necessary and with a focus on linkages to the block grant component.
Finally, the project will support the development of a comprehensive performance monitoring system, focused on the institutional performance of PRIs.
