1. law, govt and politics
2. government

2015
How Effective is Devolution Across Indian States
2.
Ranking of States in Devolution
2.1.
Introduction
This chapter seeks to develop a composite index to provide indicative ranking
of States on four different aspects of the functioning of PRIs.
2
Ranking of
States in
Devolution
Figure 2-1: Devolution Index - Ranking Parameter
It was also proposed to assess how the major CSS are implemented by the
PRIs and to rank the States according to their performances in CSS
implementation through PRIs. However because of inadequacies in data on
CSS this has been avoided.
The composite index developed seeks to capture Effective Devolution of
powers and resources as well as creation of mechanisms for responsive and
efficient governance in the PRIs. The Devolution Index constructed earlier
measured devolution from the standpoint of policy landmarks and executive
orders passed by the State governments. The attempt here is to understand
devolution from the spirit of the Constitutional mandate and the indicators
are designed to best assess the achievements of the States with respect to
this parameter.
2.2.
Data sources
As discussed in Chapter 1, two approaches of data collection were used for
this study. A questionnaire was designed for the State Panchayati Raj
departments, to obtain state-level aggregates on selected parameters.
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How Effective is Devolution Across Indian States
Parallel to this, primary data was collected from 41 DPs, 39 BPs and 42 GPs
using a structured questionnaire. The field data obtained allows for groundtruthing of data obtained from state-level aggregates and also facilitates
better understanding of specific constraints faced by PRIs. The indicators on
each component that are obtained from the state-level questionnaire and the
PRI-level questionnaire are not identical, though they reflect similar aspects of
devolution of functions, functionaries, finances and IGT.
Only 5% of DPs were selected for primary data collection and only one BP and
one GP were selected from the sample DPs4. Hence, in most of the States only
one or two DPs are included in the sample. The sample size is too small to be
representative of the State in a strictly statistical sense. The selected DPs are
close to the State average (median) in proportion of SC/ST population in total
population and share of agricultural workers in total rural workforce. It is
assumed that such a DP would be an ‘average performing DP’ in the State, in
the parameters that are being measured.
Information was sought
from the States
disaggregated to the
three tiers of
panchayats. This was the
first time that such data
was being collected.
4
The relative ranking of the States in terms of the indicators obtained from the
state-level questionnaire and the PRI-level questionnaires will vary. The
discrepancies may indicate wide disparities in the performance of PRIs within
the State. This is similar to sampling errors arising out of a very small sample
size. The discrepancies may also indicate divergence between the intended
and actual devolution in the fields captured by the field verification exercise.
2.3.
Limitations of data
Several challenges were faced at the time of data collection from State
governments and from the field. A detailed consideration of data gaps has
already been undertaken in Chapter 1, hence the discussions here will be
limited only to aspects of index construction. The questionnaire was complex
and the questions asked were very detailed and specific in nature.
Information was sought from the States disaggregated to the three tiers of
panchayats. This was the first time that such data was being collected.
A detailed discussion on sample selection is in Chapter 1
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How Effective is Devolution Across Indian States
The present official
statistical system, whose
architecture was
designed to serve the
needs of central and
state planning, does not
allow for collection,
aggregation and
dissemination of data
that are required for
planning and
administration by the
local bodies.
In most of the cases, the State governments did not have such data readily
available at their disposal. The data systems in the Panchayat Departments
are weak. For example many State governments could not provide
consolidated data on financial indicators such as own source revenue of
panchayats, development expenditure, funds received from CSS and SSS,
disaggregated by the three tiers of the panchayats. Even the number of SC, ST
and women elected representatives at the three tiers was difficult to obtain.
These are simple quantitative indicators that should have been readily
available from a departmental MIS or annual report.
To the extent that administrative records are the main sources of statistical
data, weak data systems do reflect the weakness of the State level panchayat
administration. However, non-availability of data is also a reflection of the
inability of the present statistical system in the country to cater to the data
needs of the panchayats. The present official statistical system, whose
architecture was designed to serve the needs of central and state planning,
does not allow for collection, aggregation and dissemination of data that are
required for planning and administration by the local bodies. There is an
immense need to build up systems for regular and systematic collection,
aggregation and dissemination of data for panchayats. A true assessment of
the status of devolution to the panchayats is contingent upon availability of
data of uniform quality on relevant parameters across all PRIs in the country.
The second problem faced while collecting data was ambiguity in definitions
across States. For example, there was no clear definition on what is a
transferred institution/ function/ scheme/ functionary and what should be the
relationship between a transferred institution/ function/ scheme / functionary
and the PRIs. A detailed list of existing village, block and district level
institutions/ functions/ functionaries have been provided. The institutions
were listed taking the responsibilities enlisted in the eleventh schedule as the
reference point. Specific questions were also designed to assess the actual
control exercised by the PRIs on the institution/scheme/ function/
functionary. In spite of such detailed design, satisfactory responses were not
forthcoming from most of the States. Such definitional ambiguity is also a
reflection of the disconnect between the line departments, the State
bureaucracy and the PRIs. Instead of complementing each other, they seem to
be functioning as parallel administrative structures, with the panchayats often
seen as junior partners.
As elaborated in Chapter 1, a large amount of effort for this report was for
collecting meaningful data, data that would reflect the actual and effective
status of devolution. Some of the indicators planned to be used in our analysis
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had to be dropped for data limitations. Within the limitations imposed by data availability, the report
has endeavoured to use the best available indicators and more detailed and objective quantification of
indicators.
2.4.
Components
2.4.1. Devolution of Functions
The ranking of States on the devolution of functions will be based on two indicators. The first set of
indicators tries to capture the detailed activities under each function transferred to the PRIs. The list of
functions included in the analysis covers the 29 sectoral functions mandated by the Constitution of India
as well as some general and administrative functions. The second set of indicators is the institutions
transferred to PRIs.
As indicated earlier there were definitional ambiguities in identifying transferred institutions. Therefore
through a process of elaborate communications with the States, an effort was made to grade the
institutions, working with PRIs as institutions under Substantive Functional Control (SFC) of the PRI,
Limited Functional Control of the PRI (LFC) and institutions Reporting to and only Receiving
Recommendations from PRIs (RRR). The institutions include the offices of the line departments at the
respective tier like the office of Deputy Director of Agriculture at the District Level or an actual
institution like Community Health Centre etc. For completeness, the programme setups for major CSS
programmes like National Rural Health Mission (NRHM), Sarva Siksha Abhiyan (SSA) etc., have been
included.
The ranking as described above has been done based on the relations between the PRI and the
institution, based on a checklist circulated to them. The checklist is provided in Table 2.1. The following
aspects of the interrelationships were considered:




The actual provision of resources from the PRI budget for the functioning of the institution,
The control of PRI over actual release of funds,
The control of the PRI or Standing Committee over expenditure,
The role of the PRI in deciding the programmes of the institution etc.
The aspect of control of functionaries was not included here since this is covered under functionaries
separately. Institutions receiving more than 50% of their budgetary allocations from the PRIs on a
regular basis and whose fund releases and / or expenditure are controlled by the PRI are treated as
under SFC. Institutions receiving at least part of their budgetary allocations from the PRIs on a regular
basis are treated as under LFC. Other institutions which regularly report details of their functioning to
the PRIs and may receive recommendations (which may or may not be considered) are treated as RRR.
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2.4.2. Devolution of Functionaries
Devolution of functionaries shall be based on two indicators viz., the number
of functionaries at the disposal of PRIs and the composition of the
functionaries. The first indicator measures the actual number of functionaries
including both own functionaries and transferred, available at the panchayat.
As far as functionaries
are concerned they see
the Chief Executive as
the Controlling Officer
and do not assign any
space to the Political
Executive in the matter
of their functioning
Various states have included functionaries who are under limited control of
the panchayat also here even though they were requested to include details
of functionaries who are only under the effective control of the Panchayats.
For instance functionaries reporting to the BDO (who is incidentally the Block
Panchayat Secretary) covering all the Rural Development Department
functionaries in the Block, many of whom are not having any direct
connection to the BP on a day to day basis as such, have been included as BP
Functionaries. An effort was made to go deeper into this issue by interacting
with some of the State nodal officers; which soon ran into serious conceptual
issues. It was observed that many of the nodal officers can hardly identify the
polity in the panchayat as having any role in working with functionaries. As far
as functionaries are concerned they see the Chief Executive as the Controlling
Officer and do not assign any space to the Political Executive in the matter of
their functioning. The Political Executive to them had only a policy role and
handled mundane issues like beneficiary selection - concerning their
electorate.
An effort was also made to collect data on actual control of PRIs over the
functionaries at their disposal (on matters relating to leave, transfer,
functional and operational control, disciplinary control); which could have
thrown some additional light on the relation of the PRI with the functionaries
working with them, however, the data obtained in this regard is also not
complete. This aspect has been covered in field level study to a limited extent.
The second component covers the composition of the functionaries based on
their categorisation as Professional, Technical, Administrative and Ministerial.
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Professional
Technical
•Professionally
qualified
functionaries like
Engineers,
Doctors,
Agricultural
Officer, Veterinary
Officer, Lawyers,
High School
Teachers,
Scientific staff etc
•Officers
implementing
programmes by
undertaking
project
formulation,
scheduling and
implementation identifying their
institutional role
•Functionaries who
handle technically
specific functions
like ICDS
Supervisors,
Primary School
Teachers, Nursing
staff, Paramedical
staff, Draftsmen,
Surveyors,
Mechanics, Fitters,
Plumbers, Health
Inspectors,
Drivers etc.
Administrative
•Functionaries,
who handle
routine office
functions like
clerks, typists,
accountants,
peons etc., are
treated as
Administrative
functionaries
Ministerial
•Functionaries
including Night
watchmen,
sanitation
workers,
labourers and
sweepers etc., are
treated as
Ministerial
Figure 2-2: Categorisation of Functionaries
The ratio of the sum of professional and technical functionaries out of the total was considered as
an indicator to assess the role of the functionaries in the development and welfare functions of the
PRIs.
2.4.3. Devolution of Finances
The third component deals with the devolution of finances to PRIs. It measures the quantum of funds
that the panchayat spent autonomously. It also measures the composition of receipts and utilization of
funds from the field data. As explained in Chapter 1, there had been serious problems in the reporting of
receipts and expenditure of panchayats. Because of these inconsistencies only two indicators were
available from the State level data for ranking States on the devolution of finances viz., per capita share
of NFC award in PRI receipts and per capita share of SFC award in PRI receipts. For calculating the per
capita figures rural population (as per the 2011 census) was arrived at by subtracting the population of
Urban Local Bodies5 from the total census population. Aspects of accountability of PRIs were also
covered here.
2.4.4. Infrastructure, Governance and transparency
In this component the infrastructure available with the PRIs, and mechanisms for governance and
transparency in their functioning are assessed. The indicator on transparency has been developed using
data on the number of reports on PRIs available online.
5
This is not the same as urban population, since by definition urban population includes urban agglomerations,
census towns etc., falling within PRIs.
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2.5.
Construction of Indices
Based on the indicators covered above three indices of devolution have been constructed:
a) the Index of Devolution in Policy (DPo),
b) the Index of Devolution in Practice (DPr) and
c) the Index of Devolution in Policy adjusted against Practice (DPa)
2.5.1. Disaggregation of indicators across the three tiers – an integrated model
The questionnaires and indicators are designed in a way that allows us to measure the performance
indicators at each tier of the panchayats. For example, performance of the state in transfer of
institutions to the District, Block, and Panchayat levels will be analysed. A state may have done
relatively well in transferring district level institutions to the DP, but failed to transfer village
institutions to the Gram Panchayat. Such variations can be captured in our design of indexing.
Analysis of such variations across the three tiers of the Panchayat may have important policy
implications for the states to deepen the process of devolution.
In the final analysis, the performance of each tier of the Panchayat across the states would be
ranked. The aggregate performance (rank) of the state will be the average of the performance of
each tier of PRIs.
2.5.2. Indicators
The Index of Devolution in Policy (DPo) uses information collected from the State Governments of every
State. The indicators used relate to four components and three tiers. The list of indicators is given in
Table 2.1.
Table 2-1: Indicators in the index of devolution in policy
Components/Dimensions
Indicators
Devolution of functions


Transfer of functionaries

% of detailed functions transferred6
% of institutions transferred coming under SFC and LFC
Number of functionaries (own + transferred) per 1000
population
 % of techno-professional functionaries in the functionaries own
and transferred
 % of positions filled to sanctioned strength
Devolution of finances
 Per capita SFC fund available
 Per capita CFC fund available
 % of Panchayats audited.
Infrastructure, Governance and transparency
6
An exhaustive and detailed list of functions was provided (See questionnaire and codes used in Appendix). States were
allowed to make new additions to the list. The percentage calculated is the total number of functions/activities reported
by the State government as a percentage of maximum number of functions/activities reported.
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Infrastructure

% of panchayats with rooms, computers, and internet
Transparency

% of panchayats that publish accounts ,budget documents,
accounts statement, audited accounts and annual performance
online
The Index of Devolution in Practice (DPr) uses field data from sample District, Block and Gram
panchayats.
Data on each indicator is collected for all three tiers of panchayats. The indicators used are listed in
Table 2.2.
Table 2-2: Indicators in the index of devolution in practice
Components/ Dimensions
Devolution of functions7
Indicators from field data
 % of institutions (under Substantive Functional Control
and Limited Functional Control) actually transferred;
 % of activities undertaken by the transferred; Institutions
actually managed by PRI in 2013-14;
 % of activities (other than those concerning transferred
institutions) undertaken by PRI in 2013-14.
Transfer of functionaries
 Functionaries per 1000 population;
 % of dimensions of control8;
 % of filled positions to sanctioned positions.
Devolution of finances
 Per capita development expenditure;
 Share of SFC and CFC fund in total fund available;
 Own source revenue as % of total revenue;
 Total expenditure as % of total revenue;
 Accountability including upkeep of accounts
computerised accounting, approval of accounts, auxiliary
audit, concurrent audit and performance audit.
Infrastructure, Governance and transparency
Infrastructure
 % of amenities (out of 9) available at panchayat office.
A comprehensive list of institutions and activities was provided to the States. This list was constructed using the
constitutional mandate as the reference point. The state governments had to select from the list the institutions and
activities that was transferred to PRIs in the respective States. The percentage used in construction of the index is the
number of institutions, activities reported as transferred by the State as percentage of maximum number of institutions
and activities in the code list.
8 A list of codes on the dimensions of control was provided to the States. The dimensions of control were classified as
leave, transfer, functional control and disciplinary control. The percentage arrived here is the weighted average of the
number of functionaries and the levels of control as percentage of the maximum value possible for the set of
functionaries. ie.,
100 ∑(𝑓𝑖 𝑐𝑖 )
4 ∑ 𝑓𝑖
7
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Components/ Dimensions
Governance and Transparency
Indicators from field data
 Covers measures of Governance including registers
managed, minutes books maintained, electronic records
systems established, mechanisms for certification of
project records etc.
 Systems for transparency include existence of websites,
beneficiary records mandatory disclosure on accounts
statements, social audit and other systems of mandatory
disclosure.
2.5.3. Measurement of indicators – use of numbers and ratios
To the extent possible, the use of ordinal scores (subjective scoring on a predetermined scale) to
quantify the indicators has been avoided. Most of the quantified indicators are ratios and numbers in an
interval scale. To make such quantification possible, an exhaustive set of codes and options for each
question have been designed and the indicator value can be objectively derived from the responses.
Apart from minimizing subjectivity in assigning scores, the indicators also become more sensitive to
small differences between the states, that is, the indicators are able to capture variation across states
better.
2.5.4. Normalisation of indicators
Each quantified indicator may have different maximum and minimum values, and different mean values.
This makes comparisons and aggregation across indicators difficult. Hence, the indicators must be
normalized to enable aggregation. The normalized indicator value has been arrived at using a distance
function. The distance function is most commonly used in construction of composite indices. The
indicator value of variable x, State i is computed as,
𝑑(𝑥𝑖 ) =
(𝐴𝑐𝑡𝑢𝑎𝑙 𝑥𝑖 − 𝑀𝑖𝑛 𝑥)
(𝑀𝑎𝑥 𝑥 − 𝑀𝑖𝑛 𝑥)
where Min x is the minimum value of x and Max x is the maximum value of x observed among all the
States. For example, if per capita SFC fund for DP for a State is 2.01, the maximum value of the said
indicator for the tier is 1472 and minimum is zero; then the normalised indicator value for the indicator
per capita award for DP for the State is equal to
𝑑(𝑥𝑖 ) =
2.01 − 0
= 0.0014
1472 − 0
2.5.5. Aggregation
1. The component indices
The Devolution indices DPo and DPr consist of three components, Devolution of Functions,
Functionaries and Finances, and IGT (Infrastructure, Governance and Transparency). Each of these
component indices are disaggregated for the three tiers of the Panchayats.
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2. The Tier-wise Component Index for component k and tier j can be denoted as,
𝐷𝑘𝑗 =
1
𝑛
∑ 𝑑𝑖𝑗 , ∀ 𝑎𝑙𝑙 𝑑𝑖 ∈ 𝐶𝑜𝑚𝑝𝑜𝑛𝑒𝑛𝑡 𝑘
𝑖
Where, dij is the ith indicator for jth tier in component k, and n is the total number of indicators in
component k. Thus, each indicator gets equal weight in the component index.For example, the Tier-wise
Component Index (calculated for the Composite Index on Policy) for GP, for the component ‘functions’
would be computed from the normalised values of the two indicators under that component as
mentioned in Table 2.1, as follows. Component Index for functions equals:
𝑁𝑜𝑟𝑚𝑎𝑙𝑖𝑠𝑒𝑑 𝑉𝑎𝑙𝑢𝑒 𝑜𝑓 𝑖𝑛𝑑𝑖𝑐𝑎𝑡𝑜𝑟 1 + 𝑁𝑜𝑟𝑚𝑎𝑙𝑖𝑠𝑒𝑑 𝑉𝑎𝑙𝑢𝑒 𝑜𝑓 𝑖𝑛𝑑𝑖𝑐𝑎𝑡𝑜𝑟 2
2
3. The Component wise Aggregate Index for component k is,
𝐷𝑘 =
1
3
∑ 𝐷𝑘𝑗
𝑗
Each tier gets equal weight in the aggregate component index. Adjustments in the formula are made in
the component index for three States which do not follow the three-tier structure. Jammu & Kashmir
has only gram panchayats, hence the GP component index and the component wise aggregate index is
the same for the State. Manipur and Sikkim have only two tiers; they do not have block panchayats.
Thus for these two States, the component index for component k is,
𝐷𝑘 =
1
2
∑ 𝐷𝑘𝑗
𝑗
4. The Tier wise Aggregate index for tier j can be denoted as,
𝐼𝑗 =
1
3
∑ 𝐷𝑘𝑗
𝑘
Thus, each component k has equal weight in the tier-wise Devolution Index
5. The Composite Devolution Index for all three tiers is,
1
𝐼 = ∑ 𝐼𝑗
3
𝑗
Adjustments in the formula are made for States that do not follow the three tier system.
The construction of the Index as outlined above is pictorially depicted in Figure 2.3 given below
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Figure 2-3: Pictorial depiction of construction of the Index
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2.6.
Aggregate Ranking of States in Devolution of Powers and
Responsibility to Panchayats
2.6.1. Index of Devolution in Policy
As mentioned earlier, the index of devolution in policy uses data collected from the State level
departments of Panchayati Raj. The indicators used reflect the state governments’ policy commitment
to devolve responsibilities and resources to the panchayats. Thus the indicators include the functions,
functionaries and finances officially allocated to the panchayats and the infrastructure and governance
structures created for the smooth functioning of Panchayat operations.
According to the composite index (see Table 2.3) constructed, Kerala, Karnataka, Maharashtra, Sikkim
and West Bengal are the better performers. Arunachal Pradesh, Jammu and Kashmir, Bihar, Assam and
Uttarakhand are the poorer performing States. An examination of the component indices show that the
low performance states perform poorly in many of the four dimensions. However there are variations in
performance across the better performing States.
The better performing states in terms of devolution of functions are Kerala, Sikkim and West Bengal. In
transfer of functionaries the better performers are Kerala, Maharashtra and Manipur. In finances
Karnataka, Madhya Pradesh and Kerala are among the lead performers.
In terms of infrastructure, governance and transparency, Kerala ranks 1st, West Bengal 2nd, Maharashtra
3rd and Sikkim 4th. The Panchayat administrative systems (buildings, staff, systems of record keeping,
accounting and dissemination of information) are already established and institutionalized in these
States and this is reflected in the index.
The difference in ranking of Andhra Pradesh and Telangana needs special mention. In the component
‘functions’, the ranks of Andhra Pradesh and Telangana are identical. In the component ‘functionaries’
the rank of Telangana falls below that of Andhra Pradesh, because the proportion of the technoprofessional functionaries reported is lower. The functionaries reported per thousand population is also
much smaller. This might reflect an issue of regional imbalance in erstwhile undivided Andhra Pradesh.
On the other hand the percentage of panchayats reported as audited is very high in Telangana
compared to Andhra Pradesh. This gets reflected in the component index of finances even though the
per capita share of NFC and SFC are the same for both the States for the years 2011-12 and 2012-13.
There is moderate positive correlation between the functions index and the other component indices
(see Table 2.4). Similarly functionaries have a moderate correlation with functions and finances. This
implies that in general, States performing well in one of the components also perform well in the other.
There is a weak negative correlation between functionaries and IGT. This indicates that panchayats with
lesser number of administrative personnel could leverage modern governance systems for their service
delivery to a limited extent.
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2.6.2. Index of devolution in practice
The index of devolution in practice (DPr) allows us to analyse the actual
devolution happening in the field and validate the data obtained from the
State government. The indicators chosen also reflected on actual control of
panchayats over transferred institutions, functions, functionaries, financial
autonomy and utilization of development funds and the status of
infrastructure and administrative systems in place. However, it is pointed out
at the very outset that the sample of panchayats selected for field verification
was small.
Some States such as
Assam, Uttarakhand,
Tripura, Himachal
Pradesh, Gujarat and
Haryana which have
performed poorly or
moderately poor in the
index of devolution in
policy (DPo) have
improved their
performance in the index
of devolution in practice
(DPr).
Table 2.5 provides the ranking of States by the index of development in
practice. Kerala stands out as the top performing State even in this index.
Though there are differences in the ranks, a comparison of the relative
position of States in the two indices show broad concordance, that is, most
states performing well in the index of devolution in policy (DPo) also perform
well in the index of devolution in Practice (DPr) and vice versa. Thus our
selection of indicators and the data collected from States reflect the actual
status of devolution in the field.
However, some States such as Assam, Uttarakhand, Tripura, Himachal
Pradesh, Gujarat and Haryana which have performed poorly or moderately
poor in the index of devolution in policy (DPo) have improved their
performance in the index of devolution in practice (DPr). (See figure 2.4).
Figure 2-4: Scatter Policy against Practice
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Further Assam, Uttarakhand and Tripura had been the states which were unable to furnish state level
data as could be seen from the discussions in Chapter 1 on data gaps.
At the other extreme, some moderate to good performing states in the DPo, such as Telangana, Punjab,
Andhra Pradesh, Rajasthan, Tamilnadu and Manipur, show moderate to poor performance in the DPr
index. There is a fall in the DPr rankings of these States in some of the components. This might reflect
actual problems of panchayat administration in these States.
The difference in DPr ranking of Andhra Pradesh and Telangana needs mentioning. As per the report of
the field teams, the accountability system in Telangana seems to be much better than those in Andhra
Pradesh. This is the predominant factor which has contributed to the improved ranking of Telangana in
comparison with Andhra Pradesh.
2.6.3. Comparison of rankings across tiers
Table 2.6 shows the ranking of states in the tier-wise DPo index. The district and the gram panchayats
are the most important tiers in Panchayat administration. The last column of the table shows the
difference in ranks between the DP and GP in each state. A negative difference implies that the state has
performed relatively better in devolution to the DP compared to devolution to the GP. A positive
difference implies the opposite.
Kerala ranks top in devolution to the GP level, followed by Maharashtra, Sikkim, Karnataka and
Tamilnadu. At the DP level Kerala ranks at the top with Sikkim, Karnataka, West Bengal and
Maharashtra.
Rank differences are large in Punjab, Bihar and Andhra Pradesh where devolution to GP is much behind
the State’s performance at the DP level. At the other end are Chhattisgarh, Tamilnadu and Jharkhand,
where the GP was seen to perform better than the DP In most other States the rank difference between
the DP and GP is less than 4
The pattern of variations in the DPr index is shown in Table 2.7. The variation in Andhra Pradesh,
Haryana, Telangana, Karnataka, Himachal Pradesh, Rajasthan, Tripura and Tamil Nadu is similar to that
in the DPo index. The variations are smaller in the DPr index.
In several cases like Uttarakhand, Assam, Gujarat, Jharkhand, Chhattisgarh, Punjab etc., the direction of
rank differences in DPr are not similar to that reflected in DPo. The direction of ranks’ reversal are
different thus in Punjab which has high negative rank difference in DPo, the rank difference being
positive in DPr. In the case of Uttarakhand, Gujarat, Jharkhand which exhibit positive rank differences in
DPo, the pattern is reversed in DPr. On the other hand, in the case of Chhattisgarh, with a strong
positive rank difference in DPo, the direction gets reversed and it becomes a minor negative rank
change in DPr.
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How Effective is Devolution Across Indian States
2.6.4. Index of Devolution in Policy adjusted against Practice
The aggregate index of devolution in policy adjusted against practice (DPa) in Table 2.8, takes into
account not only the achievements of each State on functions, functionaries, finances and IGT as
reproduced in the State datasets, but also how these achievements are actually reflected in sample PRIs
in the field by fine tuning the value of each dimensions in policy with its equivalent in practice. The
dimensions of the adjusted index are computed by taking the arithmetic mean of the respective indices
of the devolution in policy and the devolution in practice.
In the adjusted index also Kerala remains at the top. Sikkim is ranked second followed by Karnataka,
Maharashtra and West Bengal. At the other extreme Jammu and Kashmir is at the bottom with
Arunachal Pradesh, Bihar, Jharkhand and Uttar Pradesh being the poor performers in order. The States
which improve their performance in the adjusted index in comparison with the policy index are Assam,
Uttarakhand, Tripura, Himachal Pradesh, Gujarat and Chhattisgarh. The States which lose out on their
performance in the adjusted index in comparison with Policy index are Manipur, Andhra Pradesh,
Punjab, Telangana, Tamilnadu, Odisha and Madhya Pradesh.
The variations across the three indices are diagrammatically represented in Figure 2.5.
59
2015
How Effective is Devolution Across Indian States
0
1. Kerala
5
2
2
3. Karnataka
2
25
30
3
3
3
4
4
5
5
6. Himachal Pradesh
5
8
10
6
7
7
7. Rajasthan
14
6
15
8
8
9. Madhya Pradesh
Dpo
9
9
9
10. Odisha
12
11
12. Tripura
Dpa
13
17
7
12
22
6
13
14. Gujarat
16
11
14
13
15. Telangana
16. Uttarakhand
DPr
12
10
11. Chattisgarh
13. Assam
20
4
5. West Bengal
8. TamilNadu
15
1
1
1
2. Sikkim
4. Maharashtra
10
21
10
16
17. Haryana
16
20
17
14
18. Andhra Pradesh
20
18
15
19. Punjab
20. Manipur
17
15
19
19
11
23
20
18
18
21. Uttar Pradesh
21
19
22. Jharkhand
23. Bihar
21
22
22
23
23
24. Arunachal Pradesh
24
24
25. Jammu and Kashmir
24
Figure 2-5: Variation in Ranks of States in DPo, DPr and DPa
60
25
25
25
2015
How Effective is Devolution Across Indian States
2.7.
The effectiveness of
devolution is critically
dependent on the
operative core of
decentralisation viz.
effective transfer of
functions based on the
principle of subsidiarity,
unambiguous control of
the panchayat over the
functionaries
discharging the
functions and financial
authorisation of the
panchayat
commensurate to the
functional
responsibilities it should
discharge
Conclusion
Through this extensive study, three composite indices have been constructed
to assess the status of effective devolution of powers and responsibilities to
panchayats. The index of devolution in policy (DPo) captured the policy
intension of state governments, while the index of devolution in practice (DPr)
captured the field reality in a small sample of PRIs. The sample was not
representative for the States as a whole. However the index is much richer
and captures more nuances in the devolution of functions, functionaries and
finances, which the index of devolution in policy could not capture because of
limitations in data sets. The index of devolution in policy adjusted against
practice (DPa) is the index of devolution in policy fine-tuned by the variations
in practice.
The State of Kerala is the top performer in all the indices. Sikkim, Karnataka,
Maharashtra and West Bengal are also among the better performing States
according to the indices. Jammu & Kashmir, Arunachal Pradesh, Bihar,
Jharkhand and Uttar Pradesh are among the poorer performers in the various
indices. There was strong association in the ranking of States by DPo, DPr and
DPa.
The four components in the composite index, as discussed before, were
devolution of functions functionaries, finances, and IGT. According to DPo, the
best performers in the various component indices were Kerala, Karnataka
and Sikkim respectively.
The effectiveness of devolution is critically dependent on the operative core
of decentralisation viz. effective transfer of functions based on the principle of
subsidiarity, unambiguous control of the panchayat over the functionaries
discharging the functions and financial authorisation of the panchayat
commensurate to the functional responsibilities it should discharge.
Strengthening of Infrastructure, improving governance systems and
transparency and capacity building can also contribute to improving
performance of PRIs but in the absence of devolved powers their impact is
going to be limited. The indices developed above have captured the medium
to long-term trends in devolution across states. Incremental indices for
analysing short-term progress in states are also important; however this
requires comparable data on immediate interventions and their impacts in the
shorter term.
61
2015
How Effective is Devolution Across Indian States
2.8.
Tables
Table 2-3: Ranking of States in the component and aggregate indices of
Devolution in Policy
State
Functions
Functionaries
Finances
Aggregate
DPo
IGT
Kerala
1
1
3
1
1
Karnataka
8
12
1
8
2
Maharashtra
5
2
8
3
3
Sikkim
2
11
4
4
4
West Bengal
3
22
10
2
5
Tamil Nadu
6
7
7
13
6
Rajasthan
7
4
16
9
7
Madhya Pradesh
23
6
2
19
8
Odisha
11
15
9
17
9
Himachal Pradesh
22
5
15
6
10
Manipur
25
3
5
22
11
Chhattisgarh
4
16
22
15
12
Telangana
9
24
12
11
13
Andhra Pradesh
9
17
24
10
14
Punjab
17
14
14
12
15
Gujarat
18
19
11
18
16
Tripura
21
20
17
7
17
Uttar Pradesh
16
13
21
16
18
Jharkhand
20
23
6
20
19
Haryana
24
21
13
14
20
Uttarakhand
15
10
20
21
21
Assam
19
25
18
5
22
Bihar
12
8
25
23
23
Jammu and
Kashmir
13
18
19
24
24
Arunachal Pradesh
14
9
23
25
25
62
2015
How Effective is Devolution Across Indian States
Table 2-4: Rank Correlation Coefficient components and Aggregate
Indices
Component
Functions
Functionary
Finances
Functions
1
Functionary
0.4093
1
Finances
0.3592
0.2826
1
IGT
0.4664
-0.0001
0.3205
1
Aggregate
Dpo
0.8200
0.5351
0.6904
0.7102
63
IGT
Aggregate
DPo
1
2015
How Effective is Devolution Across Indian States
Table 2-5: Ranking of States in the component and aggregate indices of
Devolution in Practice
State
Functions Functionaries
Finances
IGT
Aggregate DPr
Kerala
1
1
1
1
1
Sikkim
3
2
13
3
2
Karnataka
2
6
11
6
3
Maharashtra
11
4
2
8
4
Himachal Pradesh
14
9
3
4
5
Assam
10
3
10
13
6
Tripura
9
5
4
12
7
West Bengal
5
22
21
2
8
Madhya Pradesh
6
18
6
7
9
Uttarakhand
4
8
17
16
10
Gujarat
8
14
15
15
11
Odisha
19
12
12
9
12
Chhattisgarh
7
21
18
10
13
Rajasthan
21
7
23
11
14
Tamil Nadu
20
17
5
14
15
Haryana
18
25
9
5
16
Telangana
13
16
16
18
17
Uttar Pradesh
17
23
8
17
18
Punjab
16
13
20
19
19
Andhra Pradesh
12
19
14
20
20
Jharkhand
23
15
22
22
21
Bihar
22
24
19
21
22
Manipur
15
11
25
23
23
Arunachal Pradesh
24
10
7
24
24
Jammu and
Kashmir
24
20
24
25
25
64
2015
How Effective is Devolution Across Indian States
Table 2-6: Ranking of States in tier-wise DPo index
Rank
Difference
Rank in Aggregate DPo Index
State
DP
BP
GP
Overall
DP-GP
Punjab
6
13
23
15
-17
Bihar
15
17
25
23
-10
Andhra Pradesh
9
14
17
14
-8
Manipur
7
NA
13
11
-6
Uttar Pradesh
16
11
22
18
-6
West Bengal
4
6
7
5
-3
Telangana
12
12
14
13
-2
Haryana
19
18
20
20
-1
Karnataka
3
2
4
2
-1
Sikkim
2
NA
3
4
-1
Arunachal Pradesh
24
22
24
25
0
Kerala
1
1
1
1
0
Odisha
10
10
10
9
0
Assam
20
20
18
22
2
Himachal Pradesh
13
9
11
10
2
Madhya Pradesh
11
8
9
8
2
Rajasthan
8
5
6
7
2
Tripura
17
19
15
17
2
Maharashtra
5
3
2
3
3
Uttarakhand
22
16
19
21
3
Gujarat
18
21
12
16
6
Jharkhand
23
15
16
19
7
Tamil Nadu
14
4
5
6
9
Chhattisgarh
21
7
8
12
13
Jammu and Kashmir
NA
NA
21
24
NA
65
2015
How Effective is Devolution Across Indian States
Table 2-7: Ranking of States in tier-wise DPr index
Rank in Aggregate DPr Index
State
Rank
Difference
DP
BP
GP
Overall
DP-GP
Andhra Pradesh
15
19
19
20
-5
Haryana
13
9
18
16
-3
Telangana
14
16
20
17
-3
Uttarakhand
7
14
9
10
-3
Assam
4
6
14
6
-2
Gujarat
9
12
13
11
-2
Jharkhand
19
22
22
21
-2
Arunachal
Pradesh
23
20
24
24
-1
Chhattisgarh
12
10
15
13
-1
Karnataka
2
2
11
3
-1
Uttar Pradesh
17
18
16
18
-1
Bihar
22
21
23
22
0
Kerala
1
1
1
1
0
West Bengal
8
5
12
8
0
Himachal Pradesh
6
7
5
5
1
Maharashtra
5
3
4
4
1
Manipur
24
NA
21
23
1
Sikkim
3
NA
2
2
1
Madhya Pradesh
11
8
6
9
2
Punjab
21
17
17
19
2
Rajasthan
16
13
10
14
2
Tripura
10
4
7
7
3
Tamil Nadu
20
15
3
15
5
Odisha
18
11
8
12
6
Jammu and
Kashmir
NA
NA
25
25
NA
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2015
How Effective is Devolution Across Indian States
Table 2-8: Ranking of States in the Aggregate Index of Policy adjusted
against Practice
State
Policy
Index
DPo
Rank
Practice
Index
DPr
Rank
Adjuste
d Index
Rank
Change
in Rank
Kerala
0.75
1
0.79
1
0.77
1
0
Karnataka
0.58
2
0.52
3
0.55
3
1
Maharashtra
0.57
3
0.49
4
0.53
4
1
Sikkim
0.57
4
0.55
2
0.56
2
-2
West Bengal
0.49
5
0.44
8
0.46
5
0
Tamil Nadu
0.48
6
0.37
15
0.43
8
2
Rajasthan
0.47
7
0.38
14
0.43
7
0
Madhya Pradesh
0.42
8
0.43
9
0.42
9
1
Odisha
0.41
9
0.39
12
0.40
10
1
Himachal Pradesh
0.41
10
0.45
5
0.43
6
-4
Manipur
0.40
11
0.25
23
0.33
20
9
Chhattisgarh
0.40
12
0.39
13
0.39
11
-1
Telangana
0.37
13
0.34
17
0.36
15
2
Andhra Pradesh
0.36
14
0.30
20
0.33
18
4
Punjab
0.35
15
0.30
19
0.33
19
4
Gujarat
0.34
16
0.40
11
0.37
14
-2
Tripura
0.34
17
0.44
7
0.39
12
-5
Uttar Pradesh
0.33
18
0.32
18
0.33
21
3
Jharkhand
0.32
19
0.27
21
0.29
22
3
Haryana
0.31
20
0.37
16
0.34
17
-3
Uttarakhand
0.30
21
0.42
10
0.36
16
-5
Assam
0.29
22
0.45
6
0.37
13
-9
Bihar
0.29
23
0.26
22
0.27
23
0
Jammu and Kashmir
0.22
24
0.18
25
0.20
25
1
Arunachal Pradesh
0.19
25
0.24
24
0.22
24
-1
67