The protest has brought to focus the extent of corruption in local bodies. The campaigners of Mahottari district did not make any lofty demands but simply wanted investigation into the misuse of grants by secretary of Banauli Danauli village development committee (VDC) and members of local political mechanism. The plight and repercussions of corruption felt by the local women of Mahottari district largely corresponds to the sentiments of people in other districts as well.
The formation of local political mechanism, a temporary arrangement to allocate, expend and oversee local development resources, seems to have exacerbated corruption index in the local bodies (LBs) since it was formed in 2005. Political psychology of the mechanism is that loot public money the way you can as nothing will happen to you because government´s track record in prosecuting people on charges of corruption is poor. In Nepal, we reward the corrupt and penalize the poor with high inflation and taxes, and by stashing away tax-paid money from the state treasury.
The most disturbing phenomenon today is fiscal malpractice by the local bodies. For every road built, for every bridge, culvert, black-topping and sidewalk constructed, the figures spell a gross mismanagement of public funds. Billions of rupees are spent annually. By any standards, this figure begs serious public scrutiny and oversight. Protracted vacuum of elected officials in LBs and political insensitivity toward revitalizing them has spurred unprecedented misuse of public funds.
Quality assurance in infrastructure built with public money is hardly an issue. From contractors to contract-lenders, they just want to finish the money filling up their pockets with sizable profits and commissions. For instance, chunk of grants to LBs is being spent on road constructions. Many VDCs are constructing roads in credit by hiring bulldozers under condition that contractors would be paid only from forthcoming fiscal year´s budget. Even if new blended block grants guidelines give priority to upgrading already-constructed tracks barring opening of new tracks, still hefty amount of grants is spent on bulldozing new tracks under political influence because they provide enormous opportunities for corruption, commission and kickbacks.
Local bodies´ grants operation guidelines do not allow use of heavy machinery equipments to construct roads but many User´s Committees (UCs) still enjoy hiring bulldozers and excavators, and later inflate bills through fake muster rolls claiming that roads are constructed manually. Municipalities, District Development Committees (DDCs) and VDCs are autonomous micro-level democratic institutions. They deliver basic services to the people and spend millions of rupees for local development and social security purposes.
There is a bizarre practice among the local bodies to exhaust budgetary allocations just for the sake of exhausting it. In a recent monitoring visit to some of the village development committees in Jajarkot and Dailekh districts, I noticed some of the projects were contracted and implemented when the end of fiscal year was a few weeks away.
But absence of elected representatives in LBs has thrown them into disarray for almost a decade. They have been passive and non-functional since 2002 as local governance modules. This has brought into question the effectiveness of the use of local resources, their allocation and productivity.
Over the years, government has increased the amount of grants it allocates to the local bodies. In fiscal year (FY) 2005/06, the total amount of block grants provided to them was Rs 4.3 billion which has risen to Rs 12 billion during in 2009/10, an increase of almost 300 percent. Exponential rise in allocations to the LBs is also because of Local Governance and Community Development Program (LGCDP), topping up grants supported by 14 development partners.
Around Rs 45 billion is annually allocated for the local development initiatives. Where does this money actually end up? Though the grants to the LBs has been inflated over the years, capacity of the LBs to allocate, manage and monitor the use of funds remains weak because of highhandedness and influence of unaccountable local all-party mechanism.
The local bodies are being run by civil servants with support of local all-party mechanism. These are just makeshift provisions to fill in the vacuum. But this arrangement is neither accountable nor transparent in using development funds. One of the prominent forms of corruption at the local level is "consensual corruption".
Political influence has an upper hand in disbursement of grants in the LBs. Local political mechanism that is in place since 2005 has failed to ensure transparency and accountability in allocation, management and use of billions of rupees annually. Without elected officials, these grassroots democratic institutions have turned into lucrative space for consensual corruption shared by government officials, political parties and UCs.
The DDC of Kathmandu distributed Rs 80 million as financial assistance to various political party outfits last year. This is a breach of DDC grants mobilization guidelines which stipulates that either 1 percent of its internal income or 100,000 rupees, whichever is less, can only be distributed as financial assistance. The Ministry of Local Development (MoLD) officials admit that majority of DDCs have been dolling out hefty sums as donations and assistance under political party pressure. The MoLD even issued a circular to various DDCs to immediately stop donating development funds to political party cadres and organizations.
What is more surprising is that even the DDC audit reports fail to mention the extent of financial assistance. How can we allow such a grotesque figure of tax-paid money to go unaccounted? It shows that even the auditors are beneficiaries of the pie. Otherwise, why don´t they mention such financial anomalies that breach the guidelines? Is not this a case of consensual corruption?
Political parties themselves don´t want to hold local elections. They know that it will deprive them of their access to public money. Whichever party leads the government, there is always a talk of revitalizing the local bodies. Even the then minister for local development, Urmila Aryal, floated a proposal for People´s Representative Council (PRC) to run local bodies. The proposal was that PRCs would be formed comprising representatives of political parties at the local level on basis of the votes they obtained in the Constituent Assembly elections.
The fear psyche among the fringe and even big parties like Nepal Congress was that their space in PRCs would not be secured because of low number of votes they gained in the CA elections. No doubt, fresh mandate is the best option. But it is unlikely at present due to political apathy. How can we allow local-level democratic institutions to be paralyzed for nearly a decade?
There is a bizarre practice among the local bodies to exhaust budgetary allocations just for the sake of exhausting it. In a recent monitoring visit to some of the VDCs in Jajarkot and Dailekh districts, I noticed some of the projects were contracted and implemented when the end of fiscal year was a few weeks away. How can quality be maintained in development infrastructures when funds are approved, allocated, used and settled just in a few weeks? Finish-at-any-cost mentality is also deeply-rooted among the mainstream political leaders.
Three Maoist ministers in Jhalanath Khanal-led government transferred Rs 120 million to their respective constituencies for non-budgetary programs weeks before the expiry of the last fiscal year. Such haphazard distribution of budgets under political pressure has only created opportunities for misuse and corruption.
Therefore, the government should either hold the local elections at the soonest possible or come up with an agreeable proposal to equip the LBs with adequate authority and human resources to function effectively. A system of checks and balances will have to be put in place to ensure transparency, accountability and efficiency in the management of development budget during political transition. We must know that these grassroots institutions alone don´t ensure democracy unless they are effectively functional. Ultimately, local democracy demands a law-compliant, accountable and elected leadership overseen by vigilant citizenry. After all, good governance is a combination of accountable leadership and vibrant citizenry.
pbhattarai2001@gmail.com
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