Suggested Reforms of Panchayati Raj Institutions

Suggestions by 6th Report of 2nd ARC Reforms:

  • It has been recommended that State Governments should encourage local bodies to outsource specific functions to public or private agencies, as may be appropriate, through enabling guidelines and support.
  • Fiscal autonomy accompanied by fiscal accountability (Genuine Fiscal Federalism) can provide a long-term solution.
    • With full fiscal responsibility and autonomy the Government would have administrative autonomy over the tax system. This would provide the Government with the opportunity to ensure simplicity and transparency, and minimize administrative and compliance burden – for example, by creating opportunities to put in place a simplified and more efficient collection regime.
  • Special Purpose Vehicles (SPVs) can be created by local communities in situations such as if there is an infrastructure need and the community is willing to pay for it.
    • For example, Budhannoor village in the Alappuzha District of Kerala has collated its efforts through the activities such as the constitution of the Standing Committee on Finance, enlisting all the institutions, persons, and traders liable to pay taxes, advising the defaulters, engaging Kudumbashree volunteers and employees for door-to-door collection of taxes, organizing tax collection camps, etc. 
  • Setting reasonable tax and fee rates, improving collection efficiencies, and expanding financing mechanisms to ensure buoyancy of revenues over time.
  • Also, access to debt capital markets can be a viable solution for sources of financing, providing them the scope for planned infrastructure development. Local bodies need to substantially improve their overall administrative and technical capacities to access debt, particularly long-term bonds.
    • For example, The Panchayat Banks model of Jharkhand has provided rural citizens with improved access to a range of government schemes as well as financial services.

Other Suggestions

Sumit Bose Committee Recommendations

  • Human Resources in Panchayats:-
    • The Committee recommended that every panchayat should have a full time secretary, who will perform both general administration and development functions.
    • It should also have a technical assistant, who will carry out engineering functions. 
    • The existing Gram Rozgar Sevaks should be formally trained to carry out essential engineering functions, such as those related to water supply and sanitation. 
  • Social accountability:
    • The Committee suggested for minimum of four meetings in a year and on the request of voters under special circumstances
  • Information and Communication Technology (ICT):
    • To use only transaction based software for:
      • carrying out their functions in delivering local services;
      • maintaining database related to local planning and monitoring progress;
      • financial management including e-procurement; and
      • estimation and management of work undertaken by them. 
  • Monitoring performance and quality of works:
    • The Committee recommended that a system of quality monitoring should be put in place for all programmes being monitored by panchayats. Standards should also be developed for all assets being created through rural development programmes.

Government Schemes


  • SVAMITVA(Survey of Villages and Mapping with Improvised Technology in Village Areas) Scheme is a collaborative effort of the Ministry of Panchayati Raj (MoPR), State Panchayati Raj Departments, State Revenue Departments and Survey of India is a Technology Implementation Agency.
  • It is a central sector scheme which was launched nationally on the occasion of National Panchayati Raj Day on 24th April 2021.
  • Aim: To provide an integrated property validation solution for rural India.
  • Features
    • The demarcation of rural inhabited areas would be done using Drone survey and CORS (Continuously Operating Reference Stations) Networks which provides mapping accuracy of 5 cm. This would provide the ‘record of rights’ to village household owners possessing houses in inhabited rural areas in villages.
    • It will cover around 6.62 Lakh villages of the entire country during 2021-2025.
  • Objectives
    • To bring financial stability to the citizens in rural India by enabling them to use their property as a financial asset for taking loans and other financial benefits.
    • Creation of accurate land records for rural planning.
    • Determination of property tax.
    • Creation of survey infrastructure and GIS (Geographic Information System) maps that can be leveraged by any department for their use.
    • To support the preparation of a better-quality Gram Panchayat Development Plan (GPDP) by making use of GIS maps.
    • To reduce property related disputes and legal cases

Gram Swaraj Abhiyan

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  • To promote social harmony, reach out to poor rural households, obtain feedback on ongoing programmes, enroll in new initiatives, focus on doubling farmers’ income, enhance livelihood opportunities and re-emphasise national priorities such as cleanliness and strengthen Panchayati Raj institutions. 

Salient Features

  •  It is a special focused intervention of seven schemes in backward districts.

e-GramSwaraj – A Simplified Work Based Accounting Application for Panchayati Raj:

  • To strengthen e-Governance in Panchayati Raj Institutions (PRIs) across the country, the Ministry of Panchayati Raj (MoPR) has launched eGramSwaraj, a user-friendly web-based portal. eGramSwaraj aims to bring in better transparency in decentralized planning, progress reporting and work-based accounting.
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Best Pratices

Uttar Pradesh

Dadera Gram Panchayat, Pura Block, Ayodhya in Uttar Pradesh, the citizens realized the need for conservation of water and rainwater harvesting.

Followed by the Gram Sabha, ‘Jal Shakti Abhiyan’ was started in the Gram Panchayat under which different initiatives were taken including digging of ponds, greywater harvesting by utilizing the wastewater of hand pumps, rainwater harvesting in public buildings, etc.

Andhra Pradesh

Andhra Pradesh has established a village secretariat to effectuate better service delivery and broadening participatory democracy.


Case Study No. 1:

  • Karnataka has created a separate bureaucratic cadre for Panchayats to get away from the practice of deputation of officials who often overpowered the elected representatives.

Case Study No. 2:

  • The chairperson of Bellandur gram panchayat of Karnataka computerized the panchayats records, accounts, and property tax collection system with assistance from a software company.
  • He also began to televise gram panchayat meetings through the local cable operator.


  • In Piplantri Village of southern Rajasthan’s Rajsamand district, there is a tradition that sets a different example of respect and honour for women by planting 111 trees whenever a girl child is born. Further, an affidavit is signed by the parents stating that their daughter will receive proper education, the girl will be married only after she reaches legal age and the trees planted after her birth have been correctly looked after.


The management of wastewater emerged as a major problem in Chandsamand Gram Panchayat, District Karnal with waste piling up in all public places inviting the protest of the public. The filthy site of overflowing ponds and water-logged streets due to improper disposal of waste water was a usual scenario in their village. At this juncture, when the Gram Panchayat was desperately searching for solutions, a project named Three Pond System, under MGNREGA in the sanitation sector entered into the Village Panchayat with the purpose to treat the grey water and further use the same for gardening, kitchen gardening and irrigation purposes.

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