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Ch 10 Governance
Good Governance
Is an essential element of any well-functioning society.
ensures effective management of resources and deliverance
services to citizens
provides social legitimacy to the system.
is critical to translating Plan outlays into significant outcomes on the
ensure the optimal use of natural resources which are sovereign
wealth under sovereign ownership
FOCUS AREAS IN GOVERNANCE / to ensure Good Governance
1. Systemic improvements, which increase the effectiveness of
government plan expenditure on new programmes.
a. competition, simplify transaction, ICT, transparency, integrity

pacts, reducing discretion, supervision, accessibility & responsiveness,

monitoring complaints, reforming civil services, risk mgmt, audit, proactive
vigilance on corruption, intelligence gathering[source - 2nd ARC - ethics in

2. improvements in customer satisfaction on the delivery of services

by government agencies.
3. Perception of corruption and what we can do to tackle it.
Improving the effectiveness of plan programmes
public expenditure in the last few years has increased dramatically
~ 7 lakh crore have been spent on the 15 major
Flagship programmes during the Eleventh Plan period
a large part of this is aimed at promoting the welfare of the weaker and
more vulnerable
for an in-depth review to judge the Effectiveness of these schemes
to promote and encourage decision making without delay to promote
efficiencies and to prevent cost overrun where major development projects
are concerned
to ensure that the administrative system and ethos protects civil
servants, who act bona fide, and in good faith.
key lacuna
is that implementation continues to be in a business-as-usual mode,
these new programmes demand a new architecture
based on
innovative practices
Change in 12th FYP

A number of changes are being instituted in the architecture of implementation of Plan
programmes in the Twelfth Plan to overcome the universalization without quality (U without
Q) syndrome.
Strengthening Local Institutions
A key diagnostic conclusion for lack of success of Plan programmes is that
these are designed in a top down manner and do not effectively
articulate the needs and aspirations of the local people, especially the most
several functions were transferred to Panchayati Raj Institutions (PRIs)
But institutionally, the PRIs remain weak and they do not have the
capacity to plan or implement programmes effectively.
resources to the Ministry of PRI increased more than 10 times than
previous FYP .
From an 11th Plan allocation of `636 crore to a 12th Plan
outlay of `6,437 crore,
also strengthen the fabric of Indian democracy at the grass-roots.
Only strong PRIs can ensure effective implementation of PESA 1996
and ST&OTFD Act
Rajiv Gandhi Panchayat
Sashaktikaran Abhiyan meant for
strengthening human resource and systems capacities of PRIs

The potential power of the NRLM lies in the economies of scale created by SHG
Federations (comprising 150200 SHGs each).
bulk purchase of inputs (seeds, fertilisers and so on) and
marketing of outputs (crops, vegetables, milk, NTFPs and so on).
They can also provide larger loans for housing and health
facilities to their members by tying up with large service or loan providers.
A variety of insurance services can be made available through
this route, including life, health, livestock and weather insurance.
It has also been shown how
doing business with SHG
Federations can help public sector bank branches in remote rural areas

Watershed Committees and Water Users Associations need strengthening,

as do the Forest Protection Committees

Social Mobilisation

The experience shows

socially mobilised and aware community act as a decisive determinant
Local communities, left to themselves, will not necessarily allow the
poor, Dalits, Adivasis and women, to express themselves
presuming that this will happen automatically, is a myth that
actually hurts the poor
active participation of local people, especially women, is essential for
success of demand-driven and bottom-up programmes such as MGNREGA,

specific provisions are being made in each flagship programme for dedicated time and human
and financial resources for social mobilisation
The new Operational Guidelines for MGNREGA, for example, provide
that those
blocks where either SCs + STs form = 30 % of the
population OR the annual MGNREGA expenditure was more than `12
crore in any year since the programme started, will mandatorily have
at least three Cluster Facilitation Teams (CFT)
Each CFT will service a cluster of Gram Panchayats (CGP),
being accountable to each GP within their Cluster

Encourage partnerships with civil society including not only NGOs but also academic
institutions, local colleges and universities.

to play in social mobilisation and capacity building to help PRIs to

take up the tasks assigned to them
for example, the network of volunteers mobilised under the National
Service Scheme (NSS)
The Twelfth Plan proposes
The Bharat Rural Livelihoods Foundation (BRLF) is proposed to be
setup to foster State - civil society partnership for transforming the livelihoods
and lives of people in areas such as the Central Indian Adivasi belt.
Innovation can be in many directionstechnology, social mobilisation
approaches, local institution
building, architecture of partnerships,
management techniques and so on.
Voluntary Sector
institutionalise Consultative Planning (at the panchayat, block,
district, State and Central levels) to enable greater representation of the
can help build a self-reliant, motivated and harmonious social order
by enabling people and peoples groups to access democratic processes and
entitlements that lead to empowerment.
a critique of public functioning
against use of excessive power by State and failure of the
market institutions to reach the poor
to ensure enhanced participation
of people and articulation of
agreement or dissent
strengthening democracy and governance through awareness of
promote grass-rootslevel innovation and human resource and talent
transforming through awareness generation and sensitisation;
providing platforms for dialogue and dissent for appreciation of and
respect for differences in opinions and affiliations;

promoting art, culture, environment protection
public enquiry;

and other forms of

National Policy on the Voluntary Sector

The Twelfth Plan should institutionalise
the Joint Consultative
Groups/Forums/Joint Machineries recommended by the NPVS in all forms
of planning, right from the grass-roots levels up to the level of Central
Government Ministries
Financing the Sector

there is a need to facilitate funding to voluntary organisations in

order to enable them to mobilise people as agents of social transformation
Strengthening Data Collection and Management Systems
an urgent need to identify and lists VOs on the basis of the
registration (trust/society/non-profit company),
empowerment/health/environment and so on)
evaluation/designing and so on)
Accreditation and Certification
to enhance their credibility, transparency and accountability, and also
ensure their capability in performing certain activities will help improve
Partnership between Public, Private and Voluntary Sectors
CSR initiatives and CorporateVO Partnerships should also include
affirmative action to ensure equity, reduce ethnic and social conflicts
Restructuring of Centrally Sponsored Schemes
In view of the large diversity of physical and economic infrastructure in
the States, the Schemes need to provide greater flexibility in their design
a Committee under Shri B.K. Chaturvedi,
Member, Planning
Commission has suggested
number of CSS should be limited and only those schemes
which are required as a part of the convergence process as a broader
scheme have large outlays, the rest to be weeded out and to be
converged with other schemes.
The existing CSS should be categorised into
Flagship schemes that have large outlays and address
major national issues;
major sub-sectoral schemes to address developmental
problems of major sectors like agriculture, education and health and
Sector-umbrella schemes which deal with the range of
problems of a particular sector
The physical and financial norms for the Schemes may be varied

depending on the requirement of the State
All CSS must have 20 per cent flexi funds (10 per cent for Flagship
schemes) to be utilised by the States as per the requirement
A concurrent independent monitoring and evaluation of the CSS.
A key deficiency of Plan programmes is that they continue to
function within the confines of
departmental silos without requisite
convergence and with a high degree of duplication of effort
convergence of implementation across programmes to pool financial
and physical resources.
Eg. rural
drinking water and sanitation programmes
should be converged so that the two objectives are attained in a
mutually consistent manner.
Similarly, it is proposed that under the JNNURM, every
water supply project will necessarily also be a sewage treatment
project and green buildings will require linkages with the energy
Effective Design and Implementation
While preparing the schemes, role of the central ministries : to act as
a knowledge partner and enabler to the project implementation
The consultation with the stakeholders is one of
the key
requirements for ensuring that the architecture of these schemes meet the
must have evaluation and feedback mechanisms, must not be left to
the audit function.
An effective evaluation can lead to improved versions of
these schemes, leading to better outcomes and more efficient use of
public resources.
To ensure that the implementation process does not lose momentum, it
is important to have some early wins
Capacity Building for Implementation
capacity building at the local level as a key instrument for improving
provide PRIs/ULBs good quality personnel
a pooled fund across programmes should be created
from which resources could be drawn for capacity building
Government institutions charged with capacity building have, by and
large, under-performed and are in urgent need of reform
limited staff can be upgraded by entering into PPP and
thus, strengthen the excellence of the faculty as well as, the quality of
training imparted
recruitment from the private sector and hiring of external consultants
through a fast track process

Cutting-edge level of implementation
use of modern technology to improve transparency, access and
efficiency of Plan programmes
Direct Cash Transfer is an unmediated and timely
manner to the target beneficiaries has seen great improvement
Independent Evaluation Office
Expert evaluation of programmes that have been in operation is done
by the Programme Evaluation Organisation
(PEO) of the Planning
This evaluation function is being strengthened by setting up an
Independent Evaluation Office (IEO), under the
aegis of Planning
A number of services include ration cards, caste certificates, income
certificates, certificates for proof of residence, passports and similar other
services. It is important that these are available within a prescribed timeline.
A number of States have passed the legislations e.g. Bihar, Madhya
Pradesh, Delhi are excellent examples of efforts to provide public services
An important aid to delivery of services can be the use of egovernance and technology.
Eg experience in the Railways reservation and inquiry ; in
refund of customs duty etc
expand the optical fibre network and expand broadband connectivity
to each panchayat levels.

Aadhar - development of unique ID numbers with biometrics to establish proof of identity.

This would help in providing various services to users and results in
controlling fake cards and thereby bring enormous savings
The financial inclusion services are also feasible by
using UID and the telecom services
expanding banking correspondence
Dissemination of Information
Citizens are not aware of many schemes
Governance can be much more interactive if extensive use is made of
all channels of communication including print and electronic media, social
media, electronic boards in public places, written materials, website etc.
Combating Corruption
Corruption is a problem which arises in all countries, developed or
developing, and it is self evident
that corruption is not only morally
objectionable, but also that it leads to serious economic distortions.
The indices of corruption produced by the WB and the Transparency
International suggest that corruption has NOT increased in the last decade,

Though it has been high, but has remained almost at the same level.
The fact that perception of corruption has increased is a different
issue and reflects the consequence of greater transparency and awareness.
The best way to prevent corruption is to have simple procedures,
which do not provide scope for interpretations & provide
minimum scope for such malpractices
This would require large use of e-governance and other
transparent procedures in award of government
contracts, government procurement and award of licences.
The economic reforms successfully eliminated discretionary decision
making in areas such as industrial licences and import licences.
With the lowering of tariffs and abolition of license and
permits, the transaction costs went down dramatically and this led to
an enormous reduction in corruption
Civil Services Reforms
First, the service should be young and the recruitment should, take
place around 21 years of age.
ARC Report on Refurbishing of Personnel AdministrationSealing New
need to
move from goals of meeting expenditure targets in
government programmes to goals of meeting physical targets and, even
more, towards increasing satisfaction of the range of stakeholders of
government policy.
accountability, (ie. being answerable to a narrower set of masters in a
focused way)
governments require extensive accountability(more
broader and more representative).

In a recent reform initiative, a number of central ministries have

adopted a Results Framework Document, (provides a summary of the
most important results that the concerned departments and ministries expect
to achieve in the year)
The main purpose of this is to move the focus of the
department from the current resource allocation mode to result
orientation, and to provide an objective and fair basis to evaluate the
departments or ministries overall performance.
A systemic analysis of the issues (through which the actions of the
various departments/ministries can be determined and develop their goals).
This critical systems input to the RFD process can be
provided by the Planning Commission
Regulatory Structures

Already in
several areas including power, oil and gas, airports,
telecom and warehousing
Regulators are also proposed in the field of water in a number of
There is
no clear assessment of the functioning of individual
to what extent they are answerable and accountable and
to whom

some principles for a robust implementation process

Build an Implementation System(broad based capability across
several sectors), dont just do the task
Systemic experimentation and learning help to progressively, and
rapidly improve implementation
Good policy development (and implementation) should follow the
PDCA cycle
(Plandevelop strategy;
Doimplement strategy;
Checkdiagnose issues in strategy and its implementation; Act
rectify issues identified).
Prioritize, sequence and create momentum through results:
Performance measures for government programmes have to be
defined consultatively: The old management adageyou cant manage
what you dont measureis especially true with
regards to complex
government programmes.
A key difference between public sector and private sector programmes
is that the Outcome value required to be produced by public programmes
is generally more intangible than in
private programmes where
shareholder value and profit may be good measures.
Therefore, it is imperative that time is spent, up front, to
define outcomes in consultation with key stakeholders.

Co-ordination between government departments is critical:

While the default solution is to create another agency/committee to
oversee this co-ordination, this is not always the optimal solution.
Additional agencies/committees can increase the clutter
in the system rather than improve its performance.
Stakeholder consultations are key to improve the quality of policy
development and implementation:
create effective forums to identify problems,
be broad-based and inclusive to ensure that all
stakeholders can contribute to the process.
Collaboration and Implementation
Poor implementation has been the root cause for Indias poor
performance in building its infrastructure and growing its manufacturing

sector too.
In China, Japan and Germanythings get done.
Two root causes identified for poor implementation are:
inadequate consensus amongst stakeholders for policy
very poor co-ordination amongst agencies in execution.
not restricted only to the infrastructure and manufacturing sectors,
exist in almost all sectors
There is a need to establish an effective backbone capability which
will provide strength to
multi-stakeholder policy and implementation
not an organisation with a large amount of resources and
nor one with the power to command top-down.
the backbone capability must essentially comprise of
small catalytic units located in many parts of the system, which can
provide the tools and techniques to the various states and ministries
to effectively coordinate, design and implement their programmes.
A Movement of Learning and Improvement
Japan, in the 1950s and 1960s had the reputation of being a producer
of low quality, cheap, goods.
By the 1980s, Japan had become the hallmark of quality across many
industries, and its infrastructure of rail and road transportation had become
a benchmark for efficiency and punctuality.
The widespread improvement of quality was brought about through
Total Quality Management (TQM), whereby seven simple tools of quality
and other techniques were widely disseminated throughout Japan.
The dissemination was done by multiple agencies. The Japanese Union
of Scientists and Engineers was one of the leaders, and several business
associations, government agencies and voluntary organisations came
together to promote quality across the country.
The subject of the TQM movement in Japan was quality. Relevant
principles, techniques and tools were provided by many persons
The distinction between creating yet another
organisation and
stimulating a movement is crucial.
disasters affect growth and the poorer sections of society gets a major
share of the impact
Investing in prevention and mitigation is economically and socially
more beneficial than expenditure in relief and rehabilitation
In a recent World Bank Study, it has been established that one dollar
spent on prevention is ten times more valuable than a dollar spent on relief
in net present value.

The large size of the Indian continent, varied geography, national
features, climate, and effects of economic development and growth process
results in number of risks.
These are clearly both due to natural hazards and effect of human
development process on nature.
National Hazards, Unnatural Disasters
According to a WB study titled National Hazards, Unnatural Disasters,
India losses up to 2 per cent of its GDP due to natural disasters.
a more comprehensive approach must be to mitigation of ill-effects of
disasters, and a development process which encompasses a strategy for
mitigation of human misery
3 important components of the strategy of disaster management:

first, integrating disaster management into development

second, a multi-pronged strategy for the total risk
third, recognition of a need for plan expenditure on
management and preventive measures in addition
calamity relief fund

Capacity building
First, setting up of early warning systems in all hazards prone areas of
the country
Effective communication systems have to be set up at all
the levels to ensure timely and accurate dissemination of warning
signals to vulnerable communities.
Second, Focusing on disaster risk reduction in all major schemes
Eg. safety of the school
buildings, especially in
earthquake prone areas has to be ensured
Community awareness and capacity building within the community
and government is undertaken at all the three levels: National, State and
Districts including villages.