1      Governance & institutional framework

1.1   Introduction

Good urban governance is characterized by transparent decision making, sound financial management, public accountability, equitable resource allocation and probity, and should lead to sustainable improvements in most urban indicators.

The governance has direct and immediate effect on the quality of life of the city. The improvement in governance can improve quality of life is successfully witnessed in cities like Surat, Nagpur and Thane. Implementation of projects having visible impacts and committed leadership are underlying features of these successes. This Chapter outlines present governance structure and institutional framework in management of city.

1.2   74th Constitutional Amendment Act

The effective local government is critical to improving access to social and infrastructure services and to mobilizing local resources. The 74th Constitution Amendment Act, 1992 (CAA) emphasis on governance, decentralization and empowerment of cities as third governmental tier through delegation of powers and functions to the city corporations. It also provides framework for reforms and building new systems in the structural, functional and planning areas of municipal management and capacity building. The highlights of 74th CAA are

Ø      Urban local governance as constitutional obligation constituted through elections and reservation for women and SC/ST. It provides for regular and fair conduct of elections through State Election Commission

Ø      Constitution of ward committees

Ø      Constitution of district planning committees mandatory for integration of urban plans in district area

Ø      Constitution of State Finance Commission for review financial position of ULBs and making recommendations for their financial health

Ø      Assignment of functions or duties of ULBs as defined in Twelfth Schedule and their transfer from State government to ULBs

The GoHP adopted the notification and amended the HP Municipal Corporation Act, 1994.

1.3   Governance Structure for Shimla

Various types of institutions are involved in providing planning, development and management of urban services in Shimla Planning Area. These include local bodies like Municipal Corporation, Special Area Development Authorities and Cantonment Board, statutory authorities and government departments.

1.4   Local Bodies

1.4.1          Shimla Municipal Corporation

·                History of Shimla Municipal Corporation

Shimla was first constituted as Municipal Committee in 1851 and became class I Municipality in 1871. In 1874, it was brought under Punjab Municipal Act, 1873. After Shimla becoming part of Himachal Pradesh on reorganization of Punjab, pursuant to Himachal Pradesh (Development and Regulation) Act 1968, Shimla Municipal Committee was converted into Corporation in 1969. With promulgation of Himachal Pradesh Municipal Corporation Act, 1994, the government revised delimitation of wards into 21 and conducted election.

·                Delineation of SMC Territory

Recently Special Areas Dhalli, Tutu and New Shimla (Kasumpti) under respective SADA have been merged into Shimla Municipal Corporation. The delineation of wards for these areas is being undertaken.

·                Organization Structure of Shimla Municipal Corporation

Governance of Shimla Municipal Corporation is through Elected Body comprising of elected councilors headed by Mayor and Administrative Body headed by Commissioner.  Administrative body is responsible for strategic and operational planning and management of Corporation.

           

o               Elected Body

The elected body of Shimla Municipal Corporation has 27 councilors out of which 24 are directly elected and 3 are nominated by GoHP. 33% seats reserved for women are represented by 10 woman councilors. Each ward has one elected Councilor.

The tenure of the corporation is five years. Last elections were held in year of 2002 and next elections are due in May 2007. The elected councilors elect Mayor and Deputy Mayor amongst themselves for tenure of two and half years.

The House comprising of elected and nominated members takes all policy decisions. The House meets at least once every month.

The Corporation has several statutory and non-statutory functional committees represented by councilors to set out the obligatory and discretionary functions bestowed upon the corporation by the 74th CAA. Each committee consists of not less than three and not more than five Councilors including Mayor or Deputy Mayor.

The organization structure of elected body and functions of various committees are presented in following Figure 6.1 and Table 6.1.

Table  STYLEREF 1 \s 1. SEQ Table \* ARABIC \s 1 1  Functions of Various Committees

S.N

Committee

Chairman

Functions

1

General Function Committee

Mayor

Establishment matters, communications, construction of buildings and roads, urban housing, relief against natural calamities, water supply, sewerage disposal, health and sanitation and all miscellaneous residuary matters

2

Finance, Contracts and Planning Committee

Mayor

Preparation of budget, scrutinizing proposals for increase of revenue including taxes, examination of receipts and expenditure statement, sales and leases of Corporation properties, recovery of loans, examination of schedule of rates, consideration of all proposals affecting the finances of the Corporation and general supervision of the revenue and expenditure of the Corporation

3

Social Justice Committee

Deputy Mayor

Promotion of education, economic, social, cultural and other interests of the Scheduled Caste, Scheduled Tribes, Backward Classes and weaker sections of the society; protection from social injustice and all other forms of exploitation; amelioration of the Schedules Castes, Scheduled Tribes and Backward Classes including other weaker sections of the society

4

Vigilance Committee

Deputy Mayor

Supervision of developmental activities, matters related to the misappropriation of the corporation funds, and all other matters involving loss to MC revenues

o               Administrative Body

The Commissioner MC Shimla appointed by State Government is administrative head of the Corporation. The organization structure of administrative body is presented in Figure 6.2.

o               Financial Powers

Delegation of financial powers in SMC is provided in Table 6.2.

 Table  STYLEREF 1 \s 1. SEQ Table \* ARABIC \s 1 2   Delegation of Financial Powers

S.N.

Powers vested with

Limit

1

Assistant Commissioner

Up to 20,000

2

Commissioner

Up to 1 Lakh

3

House

Up to 5 Lakh

4

State Government

> 5 Lakh



 

1.4.2         Special Area Development Authorities

GoHP has notified Ganahatti, Kufri, and Shoghi as Special Areas under Town and Country Planning Act 1977. The Special Area Development Authority (SADA) for respective special area is responsible for planning, implementation of development plan and provision of municipal services in notified special areas. Deputy Commissioner, Shimla is the chairman and Town and Country Planner is Member Secretary of three notified SADAs in Shimla Planning Area. The other members include SDM, Executive Engineers and village panchayat heads. TCP staff provides operational support to the SADA. Provision of services is actually done by SMC and parastatal agencies.

1.4.3         Cantonment Board

In 1924 the Government in Council declared Jutogh as a Cantonment Board under Section 2, clause XV of the Cantonment Act, 1924. The cantonment board is spread over an area of 1.41 Sq. Km. The Cantonment was originally built for and occupied by Gurkha Troops but after 1857 revolt a mountain battery was quartered and thereafter a detachment of British Infantry was stationed. The Board served a population of 1396 in 1981 in civil area. Number of houses in the Board area is 109. Present population according to 1991 census is 1636. Board obtains its water supply in bulk from military station and re-distributes it in the Board area. Cantonment Board provides basic amenities in cantonment area.

1.5   State Government Departments

Various departments of State Government are involved in urban city management functions. The details of those agencies and their responsibilities are discussed hereunder

1.5.1          Department of Urban Development

The Directorate of Urban Development was established in 1985 to direct, control and monitor activities of 53 Municipalities, 1 Municipal Corporation, 20 Municipal Councils and 32 Nagar Panchayats in the state of Himachal Pradesh.

Till 1994, the Directorate was performing nominal regulatory functions of coordination of development works, release of grants and passing of municipal budgets. Pursuant to 74th CAA and enactment of H.P. Municipal Corporation Act, 1994, Directorate is directing, supervising and controlling authority, which acts as a bridge between government and urban local bodies.

Main functions performed by the Directorate are:

Ø            Recommendation for amendments in Acts Rules/Regulations and Bye-Laws of the Urban Local Bodies;

Ø            Implementation of centrally sponsored schemes; and

Ø            Inspection and monitoring

Department of Urban Development is mandated to prepare a City development Plan for Shimla.

1.5.2         Town and Country Planning

For planning, development and use of land and execution of town and country development plan, Government of Himachal Pradesh established Directorate of Town and Country Planning (TCP) under the Himachal Pradesh Town and Country Planning Act 1977.  The functions of Town and Country Planning include

Ø            Constitution of planning/special areas;

Ø            Preparation of existing landuse, development plan for planning area;

Ø            Implementation of approved/notified development plan or interim development plan; and

Ø            Preparation of sectoral plans and town planning schemes

TCP is regulatory authority for implementation of Interim Development Plan 1979. It has prepared draft development plan of Shimla Planning Area, which is awaiting approval and notification from GoHP.

TCP does not have infrastructure and capability for GIS based planning and is dependent on external resource.

1.5.3         Irrigation and Public Health

Irrigation and Public Health Department is responsible for development of drinking water scheme for various towns, development of water related urban infrastructure, operation and management of water system like water abstraction, treatment, conveyance, storage and distribution to various ULBs, and operation and management of main sewerage line, treatment and disposal of sewage. I&PH is providing these services in all towns in the State including Shimla.

1.5.4         Public Works Department

Public Works Department is responsible for planning, construction and operation and maintenance of main road network in Shimla Planning Area.

1.5.5         Fire Department

The Fire Stations in the state functioned under the control of Municipal Committees till 1972, but thereafter GoHP took over the control of fire stations at various places in the State. The Himachal Fire Fighting Services Act came into force in 1984. Now Fire Service Department comes under Home Department of the State.

The prime duty of the organization is to protect life and property from fire. The fire department is responsible for

Ø            Prevention and combating of fire incidences

Ø            Issue of fire safety guide lines

Ø            Issue of no objection certificate from fire safety

1.6   Statutory Bodies

1.6.1          HP Housing and Urban Development Authority

HP Housing and Urban Development Authority (HIMUDA) was established under Himachal Pradesh Housing and Urban Development Authority Act, 2004. HIMUDA is entrusted with framing and execution of housing and development schemes including land development, city/town/village development, housing, industrial area, commercial/tourism, infrastructure development. The Act also authorizes HIMUDA to grant licenses to develop the housing projects.  

HIMUDA is designated as SLNA for implementation of JNNURM and UIDSSMT in Himachal Pradesh.

1.6.2         HP State Environment Protection and Pollution Control Board

HP State Environment Protection and Pollution Control Board is a regulatory body constituted in 1974 under provision of Water (Prevention & Control of Pollution) Act 1974. The main function of HP State Environment Protection and Pollution Control Board is to plan a comprehensive program for prevention, control and abatement of pollution.

1.6.3         Himachal Road Transport Corporation

Transport in Himachal Pradesh came into existence as a Himachal Government Transport in July, 1949 and continued to function as such till 1974. In 1958, the Govt. of Punjab, Government of Himachal Pradesh and Railways under Road Transport Corporation Act, 1950 floated a Corporation jointly in a name and style as “Mandi Kullu Road Transport Corporation” to operate the joint routes in the States of Punjab and Himachal. With the re-organization of Punjab State in 1966 certain hilly areas of Punjab were merged in Himachal and operational areas of Mandi Kullu Road Transport Corporation came entirely under GoHP. In 1974 Himachal Government Transport was merged with Mandi Kullu Road Transport Corporation and was renamed as Himachal Road Transport Corporation under Road Transport Corporation Act, 1950.

The HRTC is responsible for provision of regional and local transport services including city bus services in Shimla.

1.6.4         HP Bus Stand Management and Development Authority

GoHP has constituted HP Bus Stand Management and Development Authority (HPBMDA) under HP Bus Stand Management and Development Authority Act 1999. HPBMDA is responsible for planning, development, construction and operation and maintenance of Bus Stands in Himachal Pradesh. The Act provides for revenue streams comprising of Adda Fees, parking charges and other user charges for passenger amenities for HPBMDA for its sustainability.

1.6.5         HP State Electricity Board

HP State Electricity Board constituted in 1971 is responsible for planning and execution, generation, transmission and distribution of power in the State. Though unbundling of board is still pending, the generation wing has been made independent with setting up of two subsidiaries, Pabbar Valley Power Corporation and Himachal Jal Vidyut Vikas Nigam, and the accounts of transmission and distribution have been separated.

1.6.6         HP Tourism Development Corporation

HP Tourism Development Corporation (HPTDC) was established in 1972 to facilitate development of tourism in the State. Besides operating hotels in Shimla, HPTDC manages Tourist Information Centre and passenger lift between Cart road and Mall Road.

1.6.7         HP Infrastructure Development Board

HP Infrastructure Development Board has been constituted in January 2002 under HP Infrastructure Development Act 2001, which provides framework for private sector participation in financing, construction, operation and maintenance of infrastructure projects and to raise resources on behalf of State Government for infrastructure projects development.

The Chief Secretary heads the HPIDB and Finance Secretary is Chief Executive Officer (CEO) of the Board. The Board does not have any independent funding source and is dependent on GoHP budgetary allocation and borrowing through issue of bonds, debentures, loans or such other instruments.

In FY 2005-06, HPIDB has raised Rs. 616 Cr from Infrastructure Bonds issues through private placement and Rs. 530 Crores through term loan from financial institutions/ banks. The investments raised is used for financing the expenditure under State Plan against the unconditional and irrevocable State Government Guarantee.

The role of HPPIDB is limited to raising finances for GoHP and its role as a nodal agency for private sector involvement in infrastructure projects so far is negligible.

1.7   Institutional Responsibilities

The functional domain of SMC is derived from HP Municipal Corporation Act 1994 which lists obligatory and discretionary functions for SMC and functions entrusted by GoHP to SMC as per the 12th Schedule of the 74th Constitution Amendment Act.

Except for fire services all functions have been transferred to SMC. Recently urban forestry function has been recalled from SMC and transferred to Forest Department. Though these functions were transferred to SMC, the transfers remained on paper only due to lack of statutory basis, adequate institutional capacity with SMC and non-transfer of resources. In practice, the parastatal agencies continued with the functional responsibility with SMC having no role.

Table  STYLEREF 1 \s 1. SEQ Table \* ARABIC \s 1 3  Institutional Framework For Planning & Design, Construction and Operation & Maintenance

SN

Services

Planning & Design

Implementing Agency

Construction

O&M

1

Bulk Water Supply

I&PH

I&PH

I&PH

2

Water Supply and Distribution

SMC

SMC

SMC

3

Sewerage

I&PH/SMC

I&PH/SMC

I&PH/SMC

4

Drainage

I&PH/SMC

I&PH/SMC

SMC

5

Storm Water Drainage

I&PH/SMC

I&PH/SMC

SMC

5

Solid Waste Management

SMC

SMC

SMC

6

Main Roads and Bypasses

PWD

PWD

PWD

7

Internal Roads

SMC

SMC

SMC

8

Street Lighting

HPSEB/SMC

HPSEB/SMC

SMC

9

Fire Services

SMC/Fire Dept

SMC/Fire Dept

SMC/Fire Dept

10

Open Spaces/Parks

TCP

SMC

SMC

11

Transportation

HRTC/HPBMDA

HRTC/ HPBMDA

HRTC/ HPBMDA

12

Vertical Transport (Elevator)

PWD

PWD

Tourism Dept

13

Housing

HIMUDA

HIMUDA

HIMUDA

14

Basic Services to Urban Poor

DoUD/SMC

SMC

SMC

15

Urban Forest

Forest Dept

Forest Dept

Forest Dept

16

Public Conveniences

I&PH/SMC

NGO

NGO

1.8   Public Private Partnership

GoHP embarked on Public-Private-Partnership in 2003 with successful execution of concession agreement with private sector developer for design, finance, construction, operation and maintenance of Solang Nalah Ropeway. Subsequently, GoHP had taken up Jakhoo Ropeway project and Tutikandi Inter State Bus Terminal on PPP format in Shimla. These projects were developed for private sector participation by respective departments. The government has also opened doors to private builders and decided to develop a new township with private sector investment.

The role of private sector in urban infrastructure provision is presented in Table 6.4

Table  STYLEREF 1 \s 1. SEQ Table \* ARABIC \s 1 4   Role of Private Sector in Urban Infrastructure Provision

Urban Infrastructure

Role of the Private Sector

Water Supply

Nil

Sewerage

Operation and maintenance of 6 Sewage Treatment Plant

Drainage

Nil

Storm water Drainage

Nil

Solid Waste Management

D2D collection and Waste processing (Composting)

Public Conveniences

Construction, operation and maintenance by NGO

Municipal roads

Nil

Street Lighting

Nil

Bus stands

ISBT on BOT

Transport

License for Stage Carriers

1.9   Issues and Concerns

The governance and institutional framework for Shimla city is marked by poor planning, poor service delivery, inefficient tax collection, poor information systems, nontransparent and inefficient accounting and financial management, low engagement of private sector and low access to capital market, lack of IT-based municipal services and grievance redressal systems. Underlying issues are

Ø      Multiplicity of agencies with overlapping and fragmented responsibilities, lack of coordination and understanding between the institutions due to different priorities of each institution which may not be in conformation with the SMC

Ø       Information system with SMC is also poor. Due to lack of proper information system and accounting system the SMC is unable to satisfy the information needs of both internal and external users. Near absence of records and information system on SADA area is major constraint in planning

Ø      Inadequate capacity in term of infrastructure, financial, and human resource of SMC. Absence of institutional capability of SADA and TCP in provision of services to SADA areas

1.10                               

Urban Governance with Accessibility, Accountability, Transparency and Efficiency”


Vision and Strategy

In order to evolve suitable urban governance strategies it is essential to enhance institutional and human capacities and bring about good urban governance. Following strategies are recommended and majority of these strategies shall be implemented during the mission period as a part of reform agenda implementation.

Institutional Responsibility

Ø      Establishment of effective institutional arrangements including clear determination of roles, rights and responsibilities of various institutions, their scope and jurisdiction, framework for involvement of private sector and citizens

Information System

Ø      Establishment of city information system using computerization and IT application including GIS which would help in improving efficiency and productivity

e-Governance

Ø      Establishment of e-governance would need business process reengineering along with capacity building. Business process reengineering shall aim at enhancing competencies of people through well designed processes leading to higher customer value at lower cost

Capacity Building

Ø      Capacity building strategy should aim at effective institutionalization and sustainability of the program. This would include:

§         Training need assessment to identify areas of improvement

§         Establishment of Local Government Training Institution, which would enable ULBs in the state for capacity building of, elected representatives and officials to understand financial management, development and preparation of bankable projects, civic engagement and improved service delivery. Capacity building facilities should cover political, administrative, functional and operative grass root level functionaries including NGOs, CBOs, and Private Sector etc

Citizen’s Participation

Ø      Citizens' participation in improving delivery of civic services and improving urban environment should be encouraged through

§         Constitution of citizen’s committees having representatives of civil societies

§         Regular government-citizen interactions

§         Promotion of programmes like Advanced Locality Management (ALM)

Private Sector Participation

Ø      Encouraging more private sector participation in urban infrastructure provisioning and service delivery. The options available for PPP range from simple service contract to Concessions and BOT wherein private sector take responsibility for capital investment, financing, operation and maintenance, and commercial risk. The PPP options and allocation of key responsibilities are presented in Table 6.5.

Table  STYLEREF 1 \s 1. SEQ Table \* ARABIC \s 1 5  PPP – Options and Allocation

Option

Asset Ownership

O&M

Capital Investment

Commercial Risk

Duration

Service Contract

Public

Public & Private

Public

Public

1-2 years

Management Contract

Public

Private

Public

Public

3-5 years

Lease

Public

Private

Public

Shared

8-15 years

Concession

Public

Private

Private

Private

25-30 years

BOT/BOO

Private & Public

Private

Private

Private

20-30 years

1.11  Sectoral Investment Plan

S.N

Project

Project

Cost[1]

Investment Schedule (Rs.  Lakhs)

2007

2008

2009

2010

2011

2012

1

Business Process Reengineering Study

50

50

-

-

-

-

-

2

Computerization and establishment of information system

1000

-

500

500

-

-

-

3

Implementation of business process reengineering plan and e-Governance

1000

-

250

500

250

-

-

4

Establishment of Training Institution

500

-

250

250

-

-

-

5

Training of SMC and Parastatal agencies staff

500

-

100

100

100

100

100

Total

 =SUM(ABOVE) 3050

50

1100

1350

350

100

100