Seventy-Fourth Constitutional Amendment

The Constitution (Seventy-Fourth Amendment) Act, 1992 gave constitutional status to urban local government and sought to make municipalities democratic institutions of self-government. It inserted Part IXA into the Constitution, creating a common framework for their composition, elections, functions, finances and planning role.

Democratic and institutional empowerment

Part IXA provides continuity, representation and electoral accountability to urban local bodies.

• Article 243Q provides for Nagar Panchayats in transitional areas, Municipal Councils in smaller urban areas and Municipal Corporations in larger urban areas.
• Municipalities normally have a five-year tenure, and elections must be completed before expiry or within six months of dissolution.
• Seats are reserved for Scheduled Castes and Scheduled Tribes in proportion to their population, while at least one-third of all seats are reserved for women.
• The State Election Commission supervises and controls municipal electoral rolls and elections.
• Ward Committees must be constituted in municipalities having a population of three lakh or more.

Functional and planning empowerment

Under Article 243W, state legislatures may endow municipalities with powers needed to function as institutions of self-government. The Twelfth Schedule lists 18 subjects, including urban planning, land-use regulation, water supply, sanitation, solid-waste management, slum improvement and urban poverty alleviation.

• Municipalities may prepare plans for economic development and social justice and implement schemes relating to devolved functions.
• District Planning Committees and Metropolitan Planning Committees consolidate local plans and prepare draft development plans for their respective areas.

Financial empowerment and its limits

Under Article 243X, states may authorize municipalities to levy and collect taxes, assign revenues, provide grants and establish municipal funds. The State Finance Commission reviews municipal finances and recommends principles for sharing revenues and providing grants.

• The amendment creates an enabling constitutional framework, but actual transfer of functions, functionaries and finances depends substantially on state legislation and policy.
• Effective urban governance therefore requires meaningful devolution, adequate municipal revenue and administrative capacity.