MCLAD in Chennai: Initial insights

Last week I finally met with some good fortune in my visit to the Ripon Building. The helpfulness of the officials there is hardly ever a problem, but getting hold of them unfortunately is- no doubt, due to their packed and erratic schedules. Thankfully, this common hindrance did not present itself, leading to the visit being quite productive.

I managed to obtain some data on the total spending in 2012- 2103 on ward development via the Municipal Councillor Local Area Development (MCLAD) funds. Unfortunately, the data was available only on the basis of zones, implying that it is not possible to get a detailed break-up of expenditure on the basis of each individual ward or elected representative from this data set. Nevertheless, the data is very useful. It provides insight on the number of projects undertaken, along with information on how much is being spent, or will be spent, in a given zone. Table 1 depicts the number of works identified, those given administrative sanction, those that have invited tenders, and those whose tenders have been settled. Additionally, it depicts work in progress, pending projects, and those that have been completed.

Zone

Number of works identified

Administrative Sanction Obtained       

Tenders Invited

Tenders Settled

Works in Progress

Completed Works

Pending Projects

I

64

64

64

42

2

2

38

II

38

37

37

35

19

2

14

III

75

75

75

75

27

43

5

IV

116

116

116

82

5

2

75

V

64

64

64

VI

29

28

28

25

7

3

15

VII

17

7

7

VIII

2

2

IX

38

38

38

4

1

2

1

X

33

33

16

16

2

6

8

XI

30

30

30

30

15

8

7

XII

29

27

26

25

1

24

XIII

33

32

32

23

1

4

18

XIV

42

42

42

33

20

5

8

XV

30

22

22

7

5

2

Total

640

617

597

397

105

77

215

Table 1:Zone-wise utilisation of Municipal Councillor Local Area Development Fund for the year 2012-2013; Data obtained from the Corporation of Chennai

As can be seen from Table 1, nearly all the identified works have been given administrative sanction to proceed. Although 617 works have been sanctioned, tenders have been invited for only 597 works. The number of settled tenders is far smaller, numbering 397. Zone III stands out as the most productive zone, with 43 completed works, 27 works in progress, and only 5 works awaiting execution. There are no comparable performers. Zone VIII also stands out- due to other reasons. Of the 2 works identified and sanctioned, there have been no tenders invited, and consequently, no work done at all. The same conclusions follow when looking at the expenditure, in addition to granting a few other insights.

Table 2 provides more details on the total corpus available to each zone and what percentage of the funds has been used. It shows the estimated cost of identified works, the costs of works in progress, those completed, and those that are yet to be executed. These are all also represented as a percentage of the corpus available to each of the zones.

Zone

Funds available

Estimated costs of identified Works

Percentage of Funds used in the estimates

In progress- estimated costs

Percentage of funds used by projects in progress

Completed

Percentage  of funds used in completed projects

Pending

Percentage  of funds in pending projects

I

420

407.78

97

11.29

3

6.82

2

225.25

54

II

210

176.97

84

104.6

50

2.15

1

30.73

15

III

360

349.32

97

124.45

35

202.37

56

22.5

6

IV

450

228

51

13.97

3

7.27

2

114.52

25

V

450

192.93

43

0

0

0

VI

450

206.24

46

72.16

16

40.08

9

88.3

20

VII

450

240

53

0

0

0

VIII

450

20

4

0

0

0

IX

540

166.22

31

3.2

1

7.79

1

5.64

1

X

480

245.09

51

14.42

3

78.13

16

51.95

11

XI

390

285.54

73

147.34

38

59.38

15

57.22

15

XII

360

300.1

83

9.87

3

0

202.53

56

XIII

390

212.95

55

7.12

2

14.48

4

118.13

30

XIV

330

312.65

95

146.79

44

18.91

6

59.27

18

XV

270

235.11

87

30

11

0

19.22

7

Total

6000

3578.9

60

685.21

11

437.38

7

995.26

17

Table 2: Zone-wise estimated costs and percentage of funds spent for the year 2012-2013; Data obtained from the Corporation of Chennai

Each councillor is allocated Rs.30 lakh per annum, making a total of Rs.6000 lakh for all 200 wards. The data shows that only 60% of the corpus available has been earmarked for use in projects. However, this could be attributed to the inaction on part of Zone VIII, where a frugal 4% has been earmarked for spending. Other zones have earmarked as much as 97% of the available funds for the purposes of estimates. The utilisation of these funds varies greatly from zone to zone. It should also be noted that, of the projects whose tenders have been settled, just over 35% of the available funds have been utilised in the city of Chennai.

Other questions arise- where are the works sanctioned in this year and completed in the future accounted for? With Zone VIII due to call for tenders, and re-tenders being under process in zone IX, there is all probability of the percentage of funds utilised increasing. While these questions remain, the larger question of whether enough funds are being utilised?

Zone

Allotment

Tenders Settled

Percentage of Available Funds Utilized

I

420

242.64

58

II

210

137.48

65

III

360

349.32

97

IV

450

135.76

30

V

450

0

VI

450

200.54

45

VII

450

0

VIII

450

0

IX

540

16.63

3

X

480

144.5

30

XI

390

263.94

68

XII

360

212.4

59

XIII

390

139.73

36

XIV

330

224.97

68

XV

270

49.22

18

Table 3: Allotment vs. Tenders settled, in terms of percentage; Data obtained from the Corporation of Chennai

A Junior Engineer I spoke with articulated that many councillors have trouble with filing requisition letters for the purpose of obtaining these funds. According to the given data, zone III has settled tenders amounting to 97% of their available funds. If they can do it, why are the other zones lagging significantly behind? In the following weeks, I hope find answers to these questions and to find ward-based break-up of expenditure. Additionally, I also wish to explore the reasons for under-utilisation of funds by councillors.

Written by Abhay Rao, volunteer, Transparent Chennai

Accountability in the Use of Discretionary Funding

Every municipal councillor in the city of Chennai is allotted a discretionary fund called the Municipal Councillor Local Area Development Fund (MCLAD), which enables them to undertake permissible ‘capital expenditure’- that is, expenditure used to upgrade and acquire physical assets such as equipment and property, in their respective wards. The funds are held with the Corporation of Chennai (CoC), and councillors can recommend development work in their respective wards.

The amount allotted to councillors has steadily increased. Councillors were allotted Rs. 7 lakh as ward development funds in 2007-2008. It was increased to Rs. 15 lakh in 2008-2009, and at the time of writing, amounts to Rs. 30 lakh. However, these discretionary funds have been under-utilised; in 2010-2011, when Rs. 25 lakh was available annually to each councillor, less than 63% of the funds were used. Estimates of fund utilisation from 2007-2011 were obtained upon Transparent Chennai filing an RTI.[i] More recent estimates of fund utilisation are not readily available, raising the issue of accountability in the use of these discretionary funds.

The underutilisation of these funds could possibly indicate that

  • 1. Councillors were not aware of the availability of discretionary funds, or
  • 2. The process of spending these funds is cumbersome, or
  • 3. The councillors are negligent.

There is a chance that some councillors are not quite aware of the executive powers they have been given, through the form of these discretionary funds; the underutilisation of the funds would, in this case, be a logical outcome. There may also be procedural issues with spending the funds- the required procedures may not be articulated clearly enough to the councillors, or the councillors may not find the existing procedures accessible enough. I intend to explore this area further in following weeks. With greater awareness of the existence of local area funding- both among the councillors, and the general public- and more information regarding their utilisation, the use of these funds would be held to a higher degree of scrutiny, leading to their being utilised more effectively.

Related to this matter, in 2010-11, the Central Information Commission (CIC), in separate rulings, ordered the Delhi government and the Municipal Corporation of Delhi to readily supply information on the use of discretionary funds of Members of Legislative Assemblies (MLAs) and Municipal Councillors (MCs) in New Delhi. Details were to be put up on display boards in Hindi in every ward in Delhi. Instrumental to this was the work of citizen groups, notably the Satark Nagrik Sanagthan (SNS), which mobilised citizens to draft a petition demanding more information about the utilisation of these funds. These details were to be put up by March 15, 2011.[ii]

This board displays the developmental works recommended and undertaken in Ward 176, Bhati, Delhi

Sharing this information through a widely accessibly medium- in this case, through multiple display boards in every ward, demystifies the domain of municipal expenditure. Accessibility to this information helps people understand what their elected representatives are doing with the executive powers accorded to them. This system increases the quantum of accountability that the municipal council has to the general public. With increased accountability, performance indicators can easily be determined by independent commentators, without the long-winded process of attempting to obtain data.

The CIC has noted that it is the basic obligation of the government to make this information readily available, under section 4 of the RTI Act.[iii] In the case of Delhi, the petition drafted and signed by citizens proved to be an adequate impetus for the CIC to make this ruling. To initiate transparency in the use of MLA and MC development funds in Chennai, a similar impetus may be required. In the course of the following weeks, I hope to explore the reasons for the under-utilisation of the funds, and the reasons for the seemingly reticent approach the Corporation and Council appears to have when it comes to openly sharing this information.

References
Bhatnagar, G. V. (2010, September 29). Boards to display details of development funds used.

Bhatnagar, G. V. (2011, February 16). Display details of development fund expenditur.

IFMR CDF. (2011, November 24). MUNICIPAL COUNCILORS: ROLES, RESPONSIBILITIES AND PERFORMANCE (2007-11).

Kumar, R. (2012, February 2). Display boards trumpet projects ‘executed’ by Delhi Govt reps .


[i] http://www.transparentchennai.com/2011/10/14/the-curious-trend-of-councilor-and-mayor-funds/
[ii] Content Text here
[iii] http://righttoinformation.gov.in/webactrti.htm

Written by Abhay Rao, intern, Transparent Chennai