There is often a lament about human development outcomes. Despite investments under Sarva Shiksha Abhiyan (SSA), National Rural Health Mission (NRHM) and Integrated Child Development Services (ICDS), the institutions for better human development indicators are faltering. While SSA improved access and participation of girls and vulnerable social groups in schooling, learning outcomes have remained a challenge. NRHM/NHM contributed to improved performance on reduction of infant and maternal mortality and fertility rates.

However, tackling communicable and non-communicable diseases and public health preparedness still leave a lot to be desired. ICDS never became a local government driven convergent, community connect programme for simultaneous action across wider determinants of nutrition. Both governance and financing need reforms.

This sub-standard performance becomes the basis of some critics’ argument for a private sector-led intervention in providing public goods. It also makes policy planners think twice before agreeing to Budget hikes. While higher public financing is needed for quality human development outcomes, focusing on key governance and financing reforms is equally important to give us value for money.

It is important to understand how service delivery is organised in these sectors. Education and health were on the State List as per the Indian Constitution. Education was made a concurrent subject in 1976. The Eleventh Schedule for rural local governments and the Twelfth Schedule for urban local bodies assigned human development responsibilities and many other sectors to the local governments. Paradoxically, local governments do not have resources of their own. As a consequence, State governments effectively take up the role of providing for the system.

Given the unequal economic capacity of States, the then Planning Commission came up with the ‘equalising principle’ in starting Centrally sponsored and Central sector schemes for meeting minimum needs for all households. Support for schools, health facilities and aanganwadis, skills programmes, rural roads, housing, livelihoods, employment, and national social assistance programmes were all initiated as Central and Centrally-sponsored programmes. This created the paradox of Central and State funding in sectors that were the domain of local governments.

Central and State governments, through their Plan–Non-Plan and Capital–Revenue spending principles, settled that expansion of the human development system and creation of capital infrastructure could come from the Centre and regular revenue expenditure to maintain the system could be the State government’s responsibility. Finance Commissions were expected to make good the additional burden transferred from Plan to non-Plan at the end of the five-year cycle, even though the Plan and Finance Commission cycles were never coterminous.

With little or no resources, local governments became helpless observers of schools, aanganwadis and health facilities in most States. The promise of funds, functions and functionaries to local governments has remained elusive across most parts of the country, with notable exceptions like Kerala. ‘Provincialisation’ of teacher and health worker cadres leading to centralised State cadres, led to shrinkage of local level accountability. The Constitution provides for decentralisation but most Members of Parliament and State Assemblies see effective decentralisation as abrogating their authority in local matters.

The evidence worldwide is for local-level institutions steering human development interventions with funds, functions and functionaries. The role of local governments in Scandinavian countries, education districts in the US, community initiatives through local institutions across the developed world, points to the power of decentralised action. The institutional capacity of local governments has to be enhanced. There is a strong case for institutionalising the elected local government and women’s collectives/community organisation’s interface in the management of local institutions.

The path ahead

With the Public Financial Management System tracking expenditures to the last point, IT/DBT, and geotagging of assets, it is possible to provide a credible local governance system. Institutional capacity through professional managers and community resource persons, on the pattern of the Rural Livelihood Mission, will greatly facilitate a community-led local action. Local teachers and health workers require intensive capacity development support, hand holding and mentoring to move up the competency ladder. Shiksha Karmi in Rajasthan had demonstrated how it is not a low-cost model but often an effective one, even from a public finance and value-for-money perspective.

For the effectiveness of human development outcomes, it is important to provide predictability of financing and its quantum over at least 5-7 years. Central, State and local government contributions must be spelt out over the medium term to enable need-based interventions for universal quality human capital outcomes. Decentralisation is not about abdication, it is about building accountable capacity for transformation.

Human development does not lend itself to top-down short-term leadership for transformation. Professional leadership for outcomes at cluster, block and district levels needs to be carefully provided through conjunctive use of existing human resources and drawing lateral entries for skilled professionals ordinarily unavailable with governments. Recruitment of teachers, health workers, aanganwadi sevikas, and community resource persons has to become professionalised through objective assessment of performance. A component of performance-based accreditation and payments is needed to build a cadre of local, diligent human development workforce. Tough calls on discontinuing non-performers are needed.

The Sixteenth Finance Commission’s role is cut out for them. It is not enough to provide untied funds to local governments; there must be a commitment to outcomes through accountable local government-led community action.

Mandatory expenditure of Central and State Budget funds through accountable local governments, ably assisted by professional managers, technology and systems, is the way forward.

Institutions for building capacity, for applying sector-specific thought, for quality and standards, will add value if it reforms the approach of States as well. A Prime Minister’s Human Development Council with all the chief ministers, monitoring 12-14 key performance indicators of human development with a willingness to fund interventions as per needs, will surely speed up our efforts.

The writer is a retired civil servant. The views are personal