Municipal Personnel Systems in India

In India, there are three main types of municipal personnel systems. Personnel engaged in urban governance may belong to one of the following:

• Separate Personnel System:  In this system, each local body hires, manages, and supervises its personnel. These personnel cannot be transferred to other local bodies. This is the most commonly used system and it supports local autonomy, fostering undivided loyalty.

• Unified Personnel System: In this model, the state government is responsible for the hiring, management, and oversight of municipal personnel. State-wide cadres are established for all urban bodies, allowing personnel to be transferred among local bodies within the state.

• Integrated Personnel System:  In this context, employees of state government and those from local bodies are considered part of the same service. The municipal personnel are considered members of the state service and can be transferred not only among local bodies throughout the state but also to departments of the state government. This arrangement means there is no separation between local civil service and state civil service

Training institutions for municipal personnel include:  

• The All India Institute of Local Self-Government (Mumbai), which was established in 1927 as a private registered society. 
• The Centre for Urban and Environmental Studies in New Delhi, which was established in 1967 following the Nur-ud-din Ahmed Committee’s recommendations on municipal employee training from 1963 to 1965. 
• Regional centres for Urban and Environmental Studies, which were established in 1968 following the same committee’s recommendations. – The National Institute of Urban Affairs, founded in 1976. 
• The Human Settlement Management Institute, established in 1985. 

Municipal Revenue in India

To perform its functions and pay salaries to its personnel, the urban local bodies need funds. Urban local bodies have five primary income sources:  

• Tax Revenue:   Following taxes are levied by urban local bodies under Article 243X–

• • • Property Tax (Most important tax revenue for urban local bodies),
    • Entertainment Tax
    • Taxes on Advertisements
    • Professional Tax
    • Water Tax
    • Tax on animals
    • Lighting Tax
    • Pilgrim Tax
    • Market Tax
    • Toll on Bridges

• Non-Tax Revenue: Sources of these type revenue include: 

• • • Rent on Municipal Properties,
    • Fees and fines,
    • Royalty,
    • Profits and dividends,
    • Interest, 
    • User charges, which include payments for public utilities such as water, sanitation, and sewerage charges.

• Grants: Municipal bodies also receive grants from central and state governments under various development schemes for repair, development and management of urban infrastructure and for various urban reforms. The State Governments from their Consolidated Funds of state transfer these funds under Article 243X (c).

• Devolution: The State Finance Commissions from time to time recommend to their respective state governments to transfer funds to local bodies under Article 243Y.

• • According to the CAG Report (2020) regarding the financial resources of Urban Local Bodies (ULBs), fiscal transfers from the government constituted the largest part of ULBs’ revenue, averaging 63% from 2014-15 to 2018-19.
• Loans: Additionally, urban local bodies can obtain loans from the state and other financial institutions for their capital projects, but they must seek approval from the state government to borrow from these financial entities.  

Central Council of Local Government

The Central Council of Local Government was formed under Article 263 of the Indian Constitution through a Presidential order in 1954. Till 1958 the organisation dealt with matters relating to both rural and urban areas, but after 1958 it has been dealing with matters of urban local governments only. This council is made up of the Minister for Urban Development from the Government of India and the ministers responsible for Local Self Government in the states. This council serves as an advisory body, chaired by the Union minister.

Following functions are performed with regard to the local governments:

• Considering recommending the policy matters.
• Making proposals for legislation.
• Examining the possibility of cooperation between the Center and the states.
• Drawing up a common programme of action.
• Recommending Central financial assistance

• Reviewing the work done by the local bodies with central’s financial assistance.