The Cabinet Committee on Economic Affairs yesterday gave its approval for the Backward Regions Grant Fund (BRGF). Background and details of the BRGF are as under;

Background:

The National Common Minimum Programme spoke of the creation of a Backward States Grant Fund". The Mid-Term Appraisal of the Tenth Five Year Plan highlighted that regional imbalance had increased, particularly over the past 15 years. Apart from inter-state inequalities, regional disparities persist within all States, including the relatively prosperous ones. The Centre thus needs to play a stronger equity promoting role.

The Ministry of Panchayati Raj:

The Ministry of Panchayati Raj was set up as an independent Ministry to give an impetus to the strengthening of Panchayati Raj Institutions. Since the last year and a half, the Ministry has taken several important steps in this direction, such as:

(a)     The conduct of 7 Round Tables of State Ministers of Panchayati Raj between July and December 2004 so as to evolve a national consensus on the measures to be taken to strengthen Panchayati Raj,

(b)  Regular review of the progress in implementing the points of action arrived at in the  Round Tables through a Council of State Ministers of Panchayati Raj under the Chairmanship of Union Minister for Panchayati Raj, 

(c)  Review of initiatives, including Centrally Sponsored Schemes concerning the matters listed in the Eleventh Schedule of the Constitution, so as to ensure the centrality of Panchayats in planning and implementation,

(d)  Visiting States and UTs at the level of Union Minister for Panchayati Raj so as to study first hand the implementation of Panchayati Raj. Each visit is concluded with a Statement of Conclusions jointly signed with the Chief Minister of the State concerned, highlighting the key points of action on which the State would move to operationalise the recommendations of the Round Tables. So far 14 States and 2 Union Territories have been covered.

The Backward Regions Grant Fund – Key Features:

The Backward Regions Grant Fund(BRGF) is aimed at catalyzing development in backward areas by:

(a)     providing infrastructure

(b)     promoting good governance and agrarian reforms;

(c)     converging, through supplementary infrastructure and capacity building, the substantial existing development inflows into these districts as part of  a well conceived, participatory district plan.  

The scheme has two parts as follows:

(a)     Assistance provided to 250 selected backward districts across the country. At the Central level, the Union Ministry of Panchayati Raj would be the implementing Ministry for BRGF districts. The total annual allocation for assistance to Backward Districts is Rs. 3750 cr.

(b)    Special plans for Bihar and the Kalahandi-Bolangir-Koraput (KBK) districts of Orissa. At the Central level, this will be implemented through the Planning Commission. The total annual allocation under this head is Rs. 1000 crore for the Bihar Package and Rs. 250 crore for the KBK districts.

The funds are provided on a 100% grant basis and allocated as Additional Central Assistance to State Plans.

Salient Features of the District programme under BRGF:

(a)                 Two hundred and fifty districts will be covered under BRGF. This covers all Districts where the National Rural Employment Guarantee Programme is implemented and all Districts mentioned in an Inter-ministerial Task Group Report on Backwardness, constituted by the Planning Commission. A full list of districts is appended. 

(b)                The total annual allocation for the District Programme is Rs. 3750 crore for 2006-07. This will also continue for the entire 11^th Plan period (2007-2012). Of this amount Rs. 250 crore per annum at the rate of Rs. 1 crore per district is for capacity building and the balance is an untied development fund.

(c)                 From the Rs. 3500 crore fund, each District is allocated a minimum annual allocation of Rs. 10 crore. 50 % of the remaining Rs. 1000 crore will be divided between the districts on the basis of its population and 50 % on the basis of area.

(d)                 In 147 of the 250 districts where the Rashtriya Sama Vikas Yojana (RSVY) is being implemented, funds will be given to complete the ongoing programme under RSVY, following which the BRGF district programme will be implemented. In the remaining 103 districts, the BRGF programme will start straightaway.

Key role of Panchayats in BRGF:

Panchayati Raj Institutions (PRIs) from the village up to the district level will be the authorities for planning and implementation in keeping with the letter and spirit of Article 243G of the Constitution, in the manner outlined below. 

All States will be required to establish District Planning Committees (DPCs) in conformity with the provisions of Article 243 ZD of the Constitution.

As constitutionally mandated, each tier of the Panchayati Raj system – Village, Intermediate and District – and each Municipality shall prepare the perspective Five Year Plan and Annual Plans for their respective jurisdiction.

These plans will be prepared by Panchayats through implementation of programmes selected through people’s participation.

These plans will put together resources channelised to these Panchayats from all sources including (a) district segments of the State Plan (b) Centrally Sponsored Schemes, (c) Flagship Programmes such as Employment Guarantee, Sarva Shiksha Abhiyan, Rural Health Mission and  Bharat Nirman (d) Grants-in-Aid for specific purposes from Finance Commission, etc. 

BRGF funds will be used by the Panchayats for gap filling and to converge and add value to other programmes, which provide much larger resources to the same districts.

For this purpose, the funds will be sent to the State Consolidated Funds, from where a system of electronic tagging and tracking will be put in place to ensure that funds go to each Panchayat without delay or diversion.

The quantum of BRGF funds given to each Panchayat will be on the basis of a transparent formula decided at the local level. Within a district, the formula can be aimed at targeting specific pockets of backwardness. Such an exercise would provide clarity and transparency regarding the totality of funds available in these districts and would also avoid duplication and the consequent leakage of funds. To ensure steadiness and predictability in funding to Panchayats, once decided, deviations from the formula will be discouraged.

The DPC will consolidate the plans prepared by the Panchayats and Municipalities. 

To fine-tune the plans prepared at different levels, as also to undertake the convergence and consolidation of plans in the DPC in a technically acceptable sense, the State Governments, in accordance with the provisions of Article 243 ZD (3) (b), may specify institutions, organizations and individuals, who may assist the Panchayats, Municipalities and DPCs in preparing plans.

Gram Sabhas will be fully involved in implementation, particularly in selection of programmes, prioritization, selection of beneficiaries, monitoring of implementation, social audit and authorizing the issue of utilization certificates.

For creating capacity for effective planning and implementation in each Panchayats, a specific component of Rs. 250 cr at the rate of Rs. 1 crore per district per year has been provided. This will go towards increasing the capabilities of the Panchayats through provision of Panchayat level infrastructure, training, IT enabled e-Governance and making provision for Panchayats to retain outside expertise to assist them in the preparation of plans and perform related tasks.

The Ministry of Panchayati Raj would lay down the guidelines for implementation of the BRGF in consultation with the Planning Commission. The guidelines may also specify that all approvals of District Plans would be at the State level. The Planning Commission would ensure that the States’ annual and perspective plans are suitably harmonized with the district plans.

NGOs, institutions experts etc, would closely work with Panchayats for (i) providing technical assistance, (ii) maintenance of accounts (iii) social audit (iv) concurrent and post audit (v) maintenance of comprehensive databases for assisting planning and monitoring progress. 

Key Conditionalities:

The transfer of funds to the Districts would be conditional only upon the finalization of the district development plans through Panchayats and DPCs, which would be approved at the State level.

For effective decentralized planning at the grassroots level, States will be encouraged to adopt such innovations as (a) village data bases will be created on natural endowments as also a family register (b) securing outside expert assistance in plan preparation (c) eliciting Gram Sabha participation along with steps to democratize the functioning of the Gram Sabha and increasing accountability of Panchayats through transparent procedures and effective implementation of the right to information (d) ensuring effective devolution of funds. Appendix

Backward Regions Grant Fund  - List of  Districts

Andhra Pradesh

Arunachal Pradesh

Assam

Bihar

Chhattisgarh

Gujarat

Haryana

Backward Regions Grant Fund  - List of  Districts (contd.)

Himachal Pradesh

Jammu & Kashmir

Jharkhand

Karnataka

Kerala

Madhya Pradesh

Maharashtra

Manipur

Meghalaya

Mizoram

Nagaland

Orissa

Punjab

Rajasthan

Sikkim

Tamil Nadu

Tripura

Uttar Pradesh

Uttaranchal

West Bengal

AD/SL