Dr Gita Jaiswal
“Addressing the current problems of Governance is the trump card to win the fiscal crisis and initiate growth. A redirection and improvement in their method of government administration is essential. To achieve this, appropriate, simple and transparent rules minus loopholes and backed by good governance is the need of the hour”
Introduction: Governance and Fiscal reforms are not one, but they are inextricably linked. Fiscal reforms can be in the part or in whole, but it has to restore fiscal sustainability of any state. The issue of fiscal discipline in the govt. should relate to Efficiency, Economy and Effectiveness of its revenue and expenditure operations. It must be in the priority list of the Govt. of Nagaland that the financial health of the state must inscribe these four terms: Sustainability, Flexibility, Vulnerability and Transparency. Unfortunately, the service delivery system, both in India and Nagaland are often the source of despair. The last decade has seen a kind of growing recognition of improving service delivery and cracking down on corruption. Today fiscal discipline and good governance are the buzz of one and all. Fiscal Responsibility Act (FRA) was adopted by several states. In April 1999, the govt. of Nagaland signed a Memorandum of Agreement (MOA) with govt. of India to effect long term Fiscal Reforms. Later a MOU was signed in November, 2001 to implement the MTFRP.
The main objectives of Medium Term Fiscal Reforms Programmes (MTFRP) are:
(a)To reduce the Gross Fiscal Deficit of the state as an aggregate to 2.5% of the GSDP at the end of 2004-05; and to,
(b) Reduce revenue deficit, rationalize manpower, reduce non- plan revenue expenditure, etc.
The Central govt. saw the growing need of the curbing fiscal crisis and felt that fiscal discipline must be strengthened; and thus it came up with several reforms in order to initiate Nagaland to adopt fiscal reforms, the GOI allotted an incentives to the tune of rupees 535.48 crore (CAGI, 31-3-2004) to the state for the period 2000-05 (under MOU, Nov 2001). The incentives was conditional, if GON, under MTFRP, makes an effort to overcome fiscal constraints, the incentives would be given, or it shall be withheld up to 2002-03, the GON received rupees 308.39 crores as incentives, and the release for the year 2003-04 is under consideration by the GOI. According to the MOV, the incentives to the tune of rupees 535.48 crore were to be provided during the period 2000-05.
A review of govt. of Nagaland (GON) and its fiscal reform measures as per the MOU revealed that tax revenue collection had shown an improvement, yet a huge a mount of arrears remains. As for the expenditure reforms, the share of salary and pension payment which was supposed to be reduced to 2% of its GSDP had actually went up to 2.91 % of the GSDP during 2003-04. Since a minute study is not possible, due to space constraint, it is to be noted down that the state has to pass through difficult path to fulfill its promise as made through MOU. The path through which the state has to go can be made smoother if the govt. starts working as per the suggested lines:
(a) Simplify rules and regulations,
(b) Empower the people by giving the m the power to access to information; and
(c) Take effective and prompt punishment of the corrupt.
Added with it, one has to adhere to what the World Development Report 2004 has to say on strengthening service delivery. It says: “Improving service out come for poor people requires strengthening the three clients and provider, between citizen and policymaker, and between policymaker and provider.
The expansion of the-governance and adoption of information and communication technology are supposed to streamline the delivery of govt. services. It is also important to see that any experience with reforms should not get institutionalized; in fact successive govt. must carry on the reforms until the targets achieved. It is unfortunate that the GON is still in its financial crisis. The ongoing piecemeal reforms measures may not bring any desired out comes. A structural change in the methods of developments must be initiated.
With no scope of creating govt. jobs at sight, and assuming large scale industries to be a remote prospects the govt. must come up with all round developmental activities so as to usher in a welfare state. Although the present scenario may not look healthy, yet an earnest effort is required. The state must come up with a complete set of reforms. Since the govt. reforms policies are mainly meant for the poor people, then improving services means making the interest of the poor people matter more to improve. As such, govt. must engage more poor clients in an active role – as providers, as monitors and as co-producers. This can improve performance tremendously.
It is a long due of the public / citizens of Nagaland to see that its govt. fulfils its promises to create a welfare state. With only a handful of development at hand, the state has nothing to prove to boast about. The seventy percent primary sector people of Nagaland have ample chances to grow its income, yet they remain underdeveloped. The tertiary sector blooms only in some cities, the rest of the state are yet to see the first glance of development. School dropouts are on increase; quality education is yet to be sown, the lists of dismay are long and the space is short, other people are fed up! So once again, the helpless citizens of the state look up to its leaders. All know that like Rome, the state cannot be build in a day; nevertheless a strong will power, backed by enthused endeavors with right polices are required. Today all efforts must be made to see that the people – the public administration are not infested with corruption. If corruptions are not killed now, then the future Nagaland shall have only darkness. To see that the state march forward along with the rest of the globalized world, it must embrace good governance and fiscal management. The state must make an all out effort –possible- to comply with MTFRP. Compliance of the MDFRP is obviously a difficult task; but after all, everyone has to pay a penalty for its past mistakes. The states past financial history maws dismal, the present is no better. The Comptroller Auditor General of India (CAGI), report, 2004 still carries abundant story of mishandling of fund, non- compliance of rules, etc., etc. Nagaland is small and governing it judiciously and transparently need not be very difficult. It is not the political problems that tell the government employees to sit down at home during working hours! Does the common man not expect a “pucca” road or “safe drinking water” in the remote area/ villages of Nagaland?
Suggestions: These measures if affected are sure to bring fruits. The measures may seem to be impossible; but only man can make possible the hardest job. Efforts where required, the citizens, the executives and the policymakers must interact transparently and must maintain accountability. As per the latest mantras ongoing in the country and endorsed by World Bank and allied institutions, the endeavor to bring in line its revenue and expenditures so as to harbor fiscal discipline, governance.
The state govt. should adhere to:
(a) Good Governance.
(b) Strengthening Service delivery;
(c) Fiscal management;
(d) Promote efficiency, transparency, sustainability etc., etc.
(e) Build up its economic infrastructures;
(f) Revitalize agriculture sectors;
(g) Become a promoter to aid the medium and small scale industries;
(h) Set up all measures to attack corruptions;
(i) Make effort to raise its own tax an non- tax revenue ;
(j) Make effort to reduce non-plan expenditures;
(k) Make all efforts to reduce non- developmental expenditures;
(l) Heavy investment on infrastructures, social sectors are needed; and
(m) All other necessary measures that is required.
The prosperity of the state is the function of its social norms, institutions, people’s attitude towards work culture and the level of mutual trust. Each of these variables can independently or jointly effect the growth of the state in either ways. All child and human has a brain, a gift given by God; to use this brain for prosperity and healthy Nagaland, all hands are warranted.
(The writer is a Senior Lecturer, Department of Economics, Patkai Christian College, Dimapur, Nagaland)
