Report of the Portfolio Committee on Provincial and Local Government on an International Oversight Visit to Kerala, India, dated 27 February 2007:

The Portfolio Committee on Provincial and Local Government, having undertaken an international oversight visit to Kerala, India, reports as follows:

A. INTRODUCTION

The Portfolio Committee on Provincial and Local Government undertook a major study tour of municipalities from 20 to 30 January 2003 covering 41 municipalities, 3 metro sub-councils, 7 MECs and provincial departments, 4 ward committee and public meetings, 3 urban and rural nodes, and 3 Planning and Implementation Management Support Centres (PIMS). In several districts, the local municipality representatives not only raised issues about the districts to which they belong, but also the specific challenges and other issues relating specifically to their respective local municipalities. Several, in fact, gave full reports on the conditions in their local municipalities.

Flowing from the study tour of 2003, a report and supplementary report was produced and adopted by Parliament (See ATC No 53 – 2003 dated 13 May 2003 and ATC No 69 – 2003 dated 6 June 2003). One of the main challenges emanating from the report was that of public participation. The Committee felt that public participation and the involvement of residents in matters of local government was of strategic significance. More importantly it is at the heart of strengthening our system of local government and requires further study. Current mechanisms were partly drawn from international experience and therefore we thought Kerala in India, being thought of as one of the pioneers in this field, would yield interesting lessons.

Kerala was specifically chosen because there are a number of features of the Kerala system of government that are either similar to those obtaining in South Africa, or which have a bearing on possible future developments here. The Committee’s goal was to study the various dimensions of the decentralised and participatory developmental initiatives in Kerala. The Committee was keen to understand the different models of participatory development programmes currently being explored in Kerala - where huge leaps have been made in the devolution of powers and funds to local bodies.

Those who participated in the tour were: Mr Solomon Lechesa Tsenoli (Chairperson, African National Congress), Mr Mpho Morepye Sephwe Lekgoro (African National Congress), Mr Isaac Dank Mogase (African National Congress), Mr Willem Phillips Doman (Democratic Alliance), Mr Peter Francis Smith (Inkatha Freedom Party) and Mr Llewellyn Alexander Brown (Committee Secretary).

The central government and the regions (provinces) of Kerala were visited. These included visits to the Kerala Institute of Local Administration (Kila), Thrissur, Cochin, Varkala, Thiruvananthapuram, the Velookkkara Village Panchayat, the Thycattuseery Block Panchayat, the Perumbalam Village Panchayat, the Kudumbashree Units, the Municipal Corporation of Cochin, the Ernkulam District Panchayat and sessions with the Ministers of Local Government and Finance. Meetings involved a range of stakeholders including regional parliamentarians, local government councilors, government officials, academics and elected and official functionaries. All relevant institutions and role players were readily available to share their experiences with us in meetings supplemented by books and journals.

The study tour was facilitated by the South African High Commission in New Delhi in conjunction with the Department of Foreign Affairs. The Committee records its appreciation to the Commission and Department and in particular Ms M L Minnie, Acting High Commissioner, Dr S George the programme coordinator and Ms Lynne Abrahams of the Parliamentary Research Unit for the valuable research material she was able to supply the delegation prior to the departure. The Committee is also especially grateful to its secretary, Mr L Brown, for the enormous amount of work he did to ensure the success of the study tour.
B. OBJECTIVES OF THE STUDY TOUR
Apart from all of the above mentioned - the main objectives of the study tour were:
To interact with key policy makers behind the system of public participation.
To interact with implementers and practitioners.
To examine the systems institutional, financial, regulatory framework that underpins public participation.
To examine the history and other contextually relevant issues that support public participation.
C. BACKGROUND ON KERALA
1. Kerala is one of India’s 25 states, situated in the south-western tip of the
country, with the capital Thiruvananthapuram. Critical to Kerala’s governance model is the state’s political and social history. It was formed in 1956, by integrating the Malayalam-speaking states of Travancore and Cochin and the British province of Malabar. Kerala’s coastal area and its somewhat isolated location contributed to the State’s very specific climatic, religious, socio-political and economic characteristics. Its location allowed Kerala since very early to maintain contact with foreign cultures, and kept it little affected by the many wars that took place in India (Pillai, 1994). Kerala’s contact with foreign cultures in the past is still reflected in its unique pattern of religious affiliations, the most heterogeneous in India with 57% Hindus, 21.5% Christians, 21% Muslims and the remaining 0.5% Buddhists, animists and others (Pillai, 1994). Kerala combines this unique social structure in one of the most densely populated regions in the world.
Kerala's experience challenges conventional business arguments that for poor regions to progress they must first have economic growth. Kerala has taken a different path. Rather than waiting to increase the State's wealth, popular movements and left-wing governments have redistributed a significant level of the existing wealth. As a result the State has achieved a broad-based basic living standard

Kerala's unemployment runs about 25%. A quarter of the State GDP actually comes from remittances of Keralans working abroad. While this testifies to the high education levels achieved it also makes Kerala quite vulnerable to external events. As in much of the developing world, corporate practices have savaged the environment. Industrial fishing methods have destroyed fish stocks. Kerala has experienced major deforestation - leading the State to nationalise much of what remains. Villages have sued Coca Cola for destroying their water table through a bottling plant that extracts 1.5 million litres a day. Green revolution crops have drastically reduced biodiversity in coconut, bananas, and other plants leaving farmers highly vulnerable to changes in climate and pest conditions. Eighty-five percent of the State's cultivatable land focuses on rice and just ten cash crops. It has a population of around 32 million.

According to the census of 1991, the rate of literacy in Kerala is 94.59%. This literacy rate is more than double that of the country. This is attributed to the fact that throughout much of the 20th century, Kerala’s people organised to bring about near first world levels of literacy, life expectancy, birth rates and infant mortality, an effective public food distribution system, a land reform that undercut the exploitation of the privileged castes, and an agricultural labourers’ act that codified wages, working conditions, and benefits.

The Kerala Model therefore means that across the State one finds an educated population that has experienced major social reforms in recent times.




D. POLITICAL AND ADMINISTRATIVE STRUCTURES

India had a 3-tier system of government with the centre being the national government, the State and the Village Assembly at the micro level. Other intermediary government levels (District and Block) involved in development planning processes have since been introduced.

Previously, government structures tended to consolidate power and authority at the centre, however recent constitutional amendments in India have decentralised power and authority to the grassroots, especially political power. Sectoral committees at village level have been created to cater for general administration, education, health and social welfare, construction and development, and those receive their mandates from the Wards (the lowest but most important units of development planning in the villages).

The main aim of devolution of the planning process was explained as attempting to reduce bureaucracy and to allow people to take responsibility for development. Nevertheless, villages are still dependent on the higher levels of government for financial support. The national government provides a development framework and guidelines, and is generally responsible for ensuring that development happens and that the needs of the people are met. Finances are therefore mobilised at the centre and allocated down to the state, districts, and eventually to the blocks.

Decentralisation aims to strengthen and promote democracy to enable local participation in development processes as well as providing transparent, accountable and responsive governance. Thus the salient features of the 73^rd Amendment included the following:
To provide a 3-tier system of Panchayat Raj;
To hold Panchayat elections regularly every 5 years;
To provide reservation of seats for Scheduled Castes, Scheduled Tribes and women (not less than 33% of total seats);
To appoint State Finance Commissions (SFCs) to make recommendations regarding the financial powers of the Panchayats, and
To constitute District Planning Committees to prepare draft development plans for districts.

5. The new decentralised governance model is structured to provide an enabling environment for ordinary people to participate in the planning processes, especially the disadvantaged groups of the Indian society living in rural areas. Schedules 73 and 74 made allowance for what is known as the Reservation Clause. The states (provinces) have gone a long way in decentralisation though the Reservation Clause – reports received suggested a deep level of mobilisation (politically and socially). This clause provides for inclusion and representation of women and lower castes in the political structures. The representation is aimed at being proportional to the percentage population of Panchayats at all levels. In terms of the Reservation Clause, 30% of the seats and positions should be reserved for women and 10% for Other Backward Castes (OBC)


E. STRUCTURE OF PANCHAYATS

The Panchayat is an India political system that groups five villages in a quincunx (four peripheral villages around a central one). Each had appointed tasks and responsibilities, such as cart-making or basket-weaving. The central village, usually the largest of the Panchayat, traditionally handled food storage and meeting places for the officials, as well as their residence.

1. Village Panchayat - A Village Panchayat consists of between 1000 – 5000 voters and 10 – 20 members serving 10 to 20 wards. Voters in the Village Panchayat elect one member per ward to form a Village Panchayat Committee. This Committee is led by an elected Sarpanch or Village Head. In addition to this committee, residents of each village form committees to deal with local issues – these committees are coordinated by a Village Assembly. The Village Assembly is the lowest form of local government.

2. Block Panchayat – A Block Panchayat is composed of 10 – 25 Village Panchayats. Each Village Panchayat elects one member to represent it on the Block Panchayat Committee. The Block Panchayat Committee is headed by a president elected by the committee members.

3. District Panchayat – A District Panchayat consists of 10 –25 Block Panchayat. Each Block Panchayat elects one member to represent it on the District Panchayat Committee. This committee is headed by a CEO, who must be an appointed government official (rather that an elected politician).

4. Gram Swaraj - Provides for village self-rule that is expressed through the Village Panchayat. The political representation at the Village Panchayat level is one way in which communities can express their development needs.

In addition to the general functions prescribed by the Constitution, the Village Panchayat also has the power to raise its own revenue by imposing local taxes, conduct social audit of programmes and schemes implemented in the village, review, monitor and evaluate local development plans and ensure that regular Village Assembly meetings are held.

F. VILLAGE ASSEMBLY (GRAM SABHA)

1. At the village level, the concept of village self-rule (Gram Swaraj) is expressed through the “Gram Sabha” or Village Assembly. Each village has a Village Assembly which is composed of 7 standing committees, namely for Education, Health, Agriculture, Public Property, Infrastructure, Security and Social Justice. The specific roles and functions of these committees include:

Ownership of minor forest produce;
Approval of development plans;
Selection of beneficiaries under various programmes;
Consultation on land acquisition;
Management of minor water bodies;
Control of mineral leases;
Regulation/control of sale of intoxicants;
Prevent alienation of land and restore unlawfully alienated land;
Management of village markets;
Control institutions and functionaries in all social sectors.

2. Each committee may have up to 12 members and must elect a president. The presidents of these seven committees plus the Village Sarpanch form the Village Development Committee of the Village Assembly. This committee is responsible for coordinating development plans and priorities at village level. The Village Panchayat Committee in turn, consolidates the plans from the various villages under its jurisdiction, in the form of an annual development plan.

3. The Panchayats substantially remain only as implementing agencies and suppliers of inputs of government-conceived schemes. Resources such as budgets and staff largely remain with the government, and funds are provided to Panchayats tied to specific schemes.

G. THE PLANNING PROCESS

1. Village Panchayat Level
Each village elects a Village Assembly to facilitate the village level planning process. The Village Assembly (Gram Swaraj) is a statutory body that can sue and be sued. The Village Assembly prepares plans at the village level through its 7 sub-committees. The Assembly meets every month with a quorum of at least one third being women. Decisions are unanimously reached. The planning process has the following essential features:

Planning at the village level starts with ward meetings (usually attended exclusively by male household heads). During these meetings issues are raised and priorities set;
Those priorities are then submitted to the Village Assembly for adjudication;
Sub-committees of the Village Assembly consider the priorities and submit ideas for solutions to the Village Development committee;
The Village Development Committee sends its consolidated plans/priorities to the Village Panchayat.;
The Village Panchayat assesses priorities, discusses options and develops an integrated annual plan for the whole Panchayat;
The approved plan of the Panchayat with budget is then forwarded to the Block Panchayat and then to the District.

The Block Panchayat cannot alter the plans submitted by the Village Panchayat. The Block only exercises a monitoring role over the Village Panchayat. The Village Assembly sometimes receives direct projects or programmes from the Block Panchayat for approval and implementation. In such cases it is the responsibility of the Block Panchayat to ensure that funds are made available for the execution of the projects or programmes.

2. Block Panchayat Level
The Block Panchayat receives plans forwarded by the Village Panchayats under its jurisdiction. It then does an assessment on all and consolidates them into an integrated annual plan for the Block. Projects and Programmes that are beyond the jurisdiction of the Block are forwarded to the district for approval. It is the duty of the Block Panchayat to ensure that funds are made available for the execution of the projects and programmes approved by the Village Assemblies.

3. District Panchayat Level
At the district level, the District Planning Committee (DPC) embodies all the plans from the Block Panchayats into an integrated annual plan for the district. These plans are prepared based on inputs from the Village Panchayats and Block Panchayats. The approved plans including departmental budgets are sent to the State Planning Commission (SPC) for approval.

4. State Government Level
At the State Government level, district plans are received, discussed and voted upon by the State Planning Commission. However, 30% of the State funds by-pass the District and Blocks and go directly to the various Village Assemblies for project implementation.

5. National Government Level
At the National Government level there is a National Planning Commission (NPC), which is responsible for overall national planning functions. It receives plans and proposals from all State Governments, and considers them for funding.

DECENTRALISATION AND LOCAL GOVERNANCE

The democratic decentralisation process in Kerala has received national and international attention. The political will shown by the successive governments have been helpful in transforming the local bodies into institutions of local self-governance. This has contributed to enhancing the capacity of local governments to broaden and deepen the democratic process at the local level.

The core objective of decentralisation was to:
to promote local economic development by increasing production and productivity of agriculture
move towards greater social justice and reduction in gender disparities
improve governance i.r.o responsiveness, transparency and management
achieve improved efficiency of resources

Some of the challenges that decentralised governance in Kerala faces included:
the values generated have not been translated into local governance and they are not yet institutionalised
local governments have not internalised the concept of self-governance
lack of capacity to develop comprehensive plans and strategies for sustainable local economic development
redeployment of staff to local governments are still incomplete and local governments do not have sufficient staff to carry out the mandatory development responsibilities

In Kerala, a third of the plan fund is devolved to local governments for local level planning and separate guidelines are issued by the government for the utilisation of the funds in core sectors. Local government should earmark at least 30 percent for the productive sector.

The State Government has taken initiative in promoting best performance local governments through awards, certificates, prize money and additional plan assistance. These awards are given to three tier local governments at both state level and district level.


I. KUDUMBASHREE MODEL (STATE POVERTY ERADICATION MISSION)

The State Poverty Eradication Mission was launched in Kerala in 1998 with the explicit mission to eradicate absolute poverty within a period of ten years. Kudumbashree, which means “prosperity for the family”, also works in partnership with The National Bank for Agriculture and Rural Development (NABARD), commercial banks and international agencies such as UNICEF.

Kudumbashree fosters community organisation through the formation of Neighbourhood Groups (NHGs), each which consists of between 15-20 women from families that fall below the poverty line. The number of NHGs formed through the Kudumbashree totals more than 7800 in the urban areas, while in the rural areas 105 604 groups has been formed, covering just fewer than 2 million families.

Each of these NHGs makes use of five volunteer organisers consisting of a Community Health Volunteer, Community Infrastructure Volunteer, Income Generation Volunteer, Secretary and President. NHGs form a federation at the level of local government wards, and these are in turn organised into Community Development Societies (CDS). CDSs are registered with the State government as non-profit organisations.

NHGs act as Thrift and Credit Societies (T&CSs) in which the members each contribute small amounts weekly as savings. Members are free to bring whatever amount they have as savings and there is no compulsion on their contribution. Before the formation of thrift societies, the only access for credit to the poor women in the State was the local moneylenders, who lend money at an exorbitant rate of interest. At the same time, the formal banking system and its services were almost inaccessible to the poor. Thrift societies pave the way for women to build up a credit record (albeit informal), because they not only save, but also lend to each other from the communal savings.

In its early stages, the money saved by the thrift society is used mainly for daily necessities such as food or fuel; however, it is the first step towards using the savings to start up income-generating projects. These informal NHG banks are run on transparent principles agreed on by the group, and members of the group receive training from NABARD on accounting practices.

One of Kudumbashree’s core strategies is directly linking self-help groups with financial resources, training and other resources. At the more advanced stage of the NHG’s development, the money saved by the women is deposited in a nearby bank in a joint account operated jointly by the President and Secretary of the NHG. Once a Neighbourhood Group has participated in their own small savings scheme for at least six months, they are assessed. Upon positive assessment, they are eligible for a government grant of 25 000 rupees. The Group uses this money to secure materials for income-generating projects that range from traditional handloom weaving to wood carving to computer assembly and maintenance.

J. POVERTY REDUCTION

Kerala has considerable achievements in the coverage of basic
minimum services. However, the poorest of the poor have not benefited significantly from the anti-poverty programmes.

As an initial step the destitute have to be identified using criteria
developed by Kudumbashree. All families qualifying at least seven out of the following nine criteria may be listed as destitute families:
Kutcha house.
No access to safe drinking water.
No access to sanitary latrines.
Illiterate adult in the family.
Family having not more than one earning member.
Family getting barely two meals a day or less.
Presence of children below the age of five in the family.
Alcoholic or drug addict in the family.
Scheduled Caste or Scheduled Tribe family.

In addition to the above, the short listed families may be verified
with reference to the following factors at the next stage. All the short listed families having at least one of the criteria mentioned below would qualify to be called a destitute family:
Having no landed property to create their own dwelling place.
Spending nighttime in public places or streets.
Unwed mothers, single parents or those separated women living in distress.
Young widows who are economically poor or women who have passed the age of marriage and remain unmarried.
Those subject to severe, chronic and incurable diseases or physically and mentally challenged.
No healthy member below the age of sixty to win bread for the family.
Beggars who resort to beggary as a vocation.
Women subject to atrocities.

Once the list of destitute families has been drawn up by the NHGs
they would visit individual families to draw a profile of the family. The list of identified families is placed before the Grama Sabha for approval.

Once the list is finalised the trained volunteers interact with these
families and prepare family-based micro-plans to assist families
until they are no longer destitute and a tracking system is put in place to monitor progress.

K. OBSERVATIONS

Municipalities in Kerala enjoyed extensive competence over a number of matters that are in South Africa the prime competence of provinces and/or the national government. This was particularly applicable with respect to social services such as housing and welfare. Kerala’s political leadership expressly subscribed to the principle of subsidiarity in structuring its decentralisation programme.

The Kerala system also has three categories (city, urban and village), but there is no typology within each category. Moreover, the rural system is three-tiered rather than two-tiered (as in South Africa). The system appears to work.

In Kerala the state had devolved not only its powers and budget, but also its staff. This resulted in capacity being present in even the poorest and weakest municipalities.

The manner in which Community Based Organisations (CBOs) are integrated into the governance system is striking. Indeed, it is sometimes almost a misnomer that they are termed CBOs because they are seemingly local welfare organs of state rather than autonomous organs of civil society. Be that as it may, the system clearly delivers.

The relationship between the state (province) and municipalities seems healthy in as much as the state cannot interfere unilaterally in municipalities as long as the latter execute its function properly. It is praiseworthy that the state have to consult the Municipal Ombudsman before it can interfere.

As far as planning is concerned, it is admirable that India follows the approach from bottom up – starting at the local village level. It is noteworthy that they plan in five year cycles.

The emphasis on woman participation and upliftment was outstanding. Because of the history of India, there is a concentrated effort to mainstream women and women issues. One third of positions on Panchayats (councils) are reserved for women.

Weekly meetings with a structured agenda are held and all money matters are dealt with at these meetings. An interesting project of their municipalities was to provide for computer literacy for one member per family to enable all families to derive benefit from it. As far as officials are concerned the politicians expressed that the two main concerns were corruption and lack of execution of the policies of the council. One overall impression is the thrust for decentralization in governance of India.

The success in Kerala lay in the high levels of literacy, long history of social and political mobilisation and a thorough land reform programme

L. RECOMMENDATIONS

The Committee would like to urge the Minister and Department to ensure the following:

That municipalities should have more input on public works buildings and programs of government.

That municipalities should be encouraged to strengthen their consultation process and reporting back to communities on a regular basis and encourage participation by communities on issues of basic services especially housing and sanitation.

That municipalities reinforce the need for concentrated efforts to encourage the upliftment and support for effective participation of women in matters that affect them. There was a need to focus more sharply on women in the fight against poverty.

That municipalities investigate the utility for improving our system of participation as per the Kerala model. Powers of ward committees is a key issue.

That municipalities focus attention on the poor and marginalised groups as demonstrated by the 10% quota on projects towards scheduled tribes.

That municipalities examine innovative ways in which capacity at local level can be improved using provincial staff (mentoring, secondment, deployment etc).

That delivery partnerships between institutions of civil society and government are strengthened.

That the creation of a relationship and partnership with the Department of Local Self Government in Kerala and the Kerala Institute of Local Administration in India because of their particular experience be explored.

Report to be considered.