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Gram Swaraj-Karnataka Panchayat Strengthening Project

Abbreviations and Acronyms

AFS Annual Project Financial Statements KFC Karnataka Financial Code AG Auditor General KPRA Karnataka Panchayat Raj Act-1993 AIDS Acquired Immune Deficiency Syndrome KPSP Karnataka Panchayat strengthening Project

ANM Auxiliary Nursing Midwife KPTCL Karnataka Power Transmission Corporation Limited

ANSSIRD Abdul Nazir Sab State Institute of Rural Development KSAD Karnataka State Accounts Department

AWW Auxiliary Women Worker KVIC Khadi Village Industries and Commerce BG Block Grants MFP Minimum Forest Produce CAG Comptroller and Auditor General MMR Monthly Multi Review CEO Chief Executive Officer NCB National Competitive Bidding

CP Central Program NGASAB National Government Accounts Standard Board

CSS Centrally Sponsored Scheme NGO Non-Governmental Organization DAC Decentralized Analysis Cell OBC Other Backward Communities DDO Drawing and Disbursing Officer PAD Project Appraisal Document DDP Desert Development Program PIA Project Implementing Agency DIC District Industries and Commerce PMU Project Monitoring unit

DPAP Drought Prone Area Development Program PRI Panchayat Raj Institute

DPR Detailed Project Report RBI Reserve Bank of India

DWCRA Development of Women and Children in Rural Area RDED Rural Development Engineer Department

EAS Employment Assurance Scheme RDPR Rural Development and Panchayat Raj EGS Employment Guarantee Scheme RTI Right to Information Act EO Executive Officer SATCOM Satellite Communication FC Facilitation Cell SC Schedule Caste

FMR Financial Management Report SFAA State Public Financial Accountability Assessment

GOI Government of India SGRY Samporna Grameena Rojgar Yojane GOK Government of Karnataka SIC Sector Investment Credit GP Gram Panchayat ST Schedule Tribe ICB International Competitive Bidding TOR Terms of Reference ICDS Integrated Child Development Scheme TOT Training for Trainers IDA International Development Association TP Taluk Panchayat

IEC Information Education and Communication TRC Taluk Resource Center

INR Indian Rupees USD United State Dollar

IT Information Technology VWSC Village Water Supply and Sanitation Committee

JGSY Jawahara Gram Samrudhi Yojana ZP Zilla Panchayat

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INDEX 1 Gram Swaraj-Project Overview...........................................................................................5 2 Project Description....................................................................................................................5 3 Project Objectives ......................................................................................................................5 4. Key Outputs & Outcomes .......................................................................................................6

3.1 Key Outputs ..............................................................................................................................6 3.2 Key Outcomes:..........................................................................................................................6

5. Strategy to Achieve Development Objectives:.................................................................7 3.3 Block grants to Gram Panchayats .............................................................................................7 3.4 Information Systems for Constituents.......................................................................................7 3.5 Human Resource Development and Capacity Building of Panchayats ....................................7

3.5.1 Creation of GP resource cells at the Taluk level ..............................................................8 3.5.2 Service delivery monitoring system...................................................................................8 3.5.3 Training programs for Panchayats through ANSSIRD ..................................................8 3.5.4 Training of Government staff ..........................................................................................10 3.5.5 Computerized financial management system for GPs...................................................10 3.5.6 Environmental framework for Panchayats ....................................................................11

3.6 Building the capacity of the state............................................................................................11 3.6.1 Decentralization Analysis Cell (DAC).............................................................................12 3.6.2 Strengthening of the State Institute for Rural Development ........................................12 3.6.3 Restructuring of line agencies ..........................................................................................12

6. Institutional and Implementation arrangements .........................................................12 6.1 Facilitation Cell (FC) in RDPR Department...........................................................................12 6.2 Department of Finance and RDPR..........................................................................................13 6.3 State Institute for Rural Development. ...................................................................................13 6.4 District Panchayats..................................................................................................................13 6.5 Taluk Panchayats. ...................................................................................................................14 6.6 Gram Panchayats.....................................................................................................................14 6.7 Gram and Ward Sabhas...........................................................................................................14 6.8 Social: Ensuring marginalized groups participation ...............................................................15

7. Monitoring and evaluation of outcomes/results............................................................15 7.1 Monitoring ..............................................................................................................................15 7.2 Evaluation ...............................................................................................................................16

8. Fiduciary Management..........................................................................................................17 7.3 Fund Flow Arrangement: ........................................................................................................18 Procedure for release of Quarterly Grants to GPs is detailed as below: .............................................19 3.3 Release of Funds to other implementing agencies namely, TPs, ZPs, SIRD and DAC: ........19 7.4 Books of Accounts ..................................................................................................................20 7.5 Returns to be submitted by the implementing agencies..........................................................21

9. Audit .............................................................................................................................................21 9.1 Internal Controls .....................................................................................................................21 9.2 External Audit .........................................................................................................................22 9.3 Financial Management & Terms of reference for audit:.........................................................22

10. Procurement ..............................................................................................................................22 11. Project period and Project Finance: .................................................................................23

9.4 Details of Project Cost ............................................................................................................24 12. Disbursements ...........................................................................................................................24

9.5 Fiscal Parameters ....................................................................................................................25

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9.6 Institutional Governance parameters ......................................................................................26 9.7 Social Indicators......................................................................................................................27

13. Eligibility for Grants under the project...........................................................................28 14. Project Formulation and Preparation of Action Plans ..............................................28 15. Budgets and Financial Controls .........................................................................................30 16. Grants from State Government: ........................................................................................31 17. Grants from Government of India:...................................................................................31

18. Operation of funds in Zilla Panchayats/ Taluk Panchayats/ Grama Panchayats: ........................................................................................................................................31

18.1 Zilla Panchayats: .....................................................................................................................31 18.2 Taluk Panchayats: ...................................................................................................................32 18.3 Gram Panchayats: ...................................................................................................................33

19. Annexure-1 .................................................................................................................................34 20. Annexure-2 .................................................................................................................................35 21. Annexure-3 .................................................................................................................................36 22. Annexure-4 .................................................................................................................................37 23. Annexure-5 .................................................................................................................................42 24. Annexure-6 .................................................................................................................................48 25. Annexure-7 .................................................................................................................................57 23. Annexure-8 .................................................................................................................................60 27. Annexure-9 ..................................................................................................................................64 28. Annexure-10...............................................................................................................................67 24. Annexure-11...............................................................................................................................70 25. Annexure-12...............................................................................................................................74 26. Annexure-13...............................................................................................................................88 27. Annexure-14...............................................................................................................................89 28. Annexure-15...............................................................................................................................98 29. Annexure-16.............................................................................................................................101

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1 Gram Swaraj-Project Overview Karnataka has been in the forefront of administrative decentralization and devolution of powers to the

Panchayats as envisaged in the Constitution. It has been observed that the Panchayat Raj Institution

structure in Karnataka has now been stabilized and strengthened with three elections. However, to

make them truly institutions of local self- governments, there is a need to provide Gram Panchayats

with additional resources and also encourage them to raise resources commensurate to their needs and

increase their capacity to utilize the resources. Resources utilized towards services that are prioritized

locally would lead to greater satisfaction among the local population. The project gives special

emphasis to improve the service delivery by Gram Panchayats particularly with respect to the

management of public resources and the delivery of services that the local people prioritize and decide.

The strategy to achieve this development objective is through developing the capacity of the

Institutions at all three tiers of district (Zilla), block (Taluka) and village (Grama) Panchayats, by

imparting training to PRI members and functionaries.

The project will be implemented in 1343 GPs in 39 ‘Most Backward Taluks’ identified in the

Nanjundappa Committee Report. The list of the 39 Most Backward Taluks’ is annexed as Annexure-1

2 Project Description

Lending Instrument

The instrument is a programmatic loan in the form of a Sector Investment Credit (SIC) through which

IDA would provide additional funds to the poorest GPs. IDA would rely on GOK ’s own rules and

procedures to implement the program including for financial management, reporting and auditing.

3 Project Objectives The major objective of the project in the 39 ‘Most Backward Taluks’ is to provide them opportunities

towards improving their present conditions particularly with respect to the management of public

resources and the delivery of relevant services that the rural people prioritize. In order to achieve this

objective, the project would:

• Build capacity in the Grama Panchayats (GPs), Taluka Panchayats (TPs) and Zilla Panchayats

(ZPs) Improve framework and guidelines for own revenue collection.

• Provide formula-based Block grants to 1343 GPs in the ‘Most Backward Talukas’

• Revamp financial management and procurement system.

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• Improve the effectiveness of service delivery across a range of services that have devolved on

them under the Karnataka Panchayat Raj Act, 1993 (KPR Act, 1993)

4. Key Outputs & Outcomes The development objective of the project is to improve the effectiveness of service delivery by the

Gram Panchayats particularly with respect to the management of public resources and the delivery of

relevant services that the rural people prioritize. The result framework of key output and outcome is

annexed as Annexure-2 and Annexure-3.

3.1 Key Outputs The key outputs of the State program would be:

• Efficacy of larger Untied grants to be used in accordance with local priorities;

• Revamped financial management and procurement system for GPs;

• Higher transfers to Panchayats in Most Backward Talukas.

• Monitoring of service delivery performance at the GP level (e.g. rural drinking water,

education, participatory planning, financial management, capacity building);

• Improved framework for own revenue collection;

• All GPs computerized;

• Environmental framework for GPs;

• Expanded capacity building programs;

• Improved planning guidelines with provisions for enhanced participation;

• Monitoring system on fiscal and service delivery aspects of Panchayats;

• Information on Panchayat performance available to constituents;

• A decentralization cell at state level to monitor and manage the process.

3.2 Key Outcomes: The key outcomes from the program would be:

• Predictable state disbursements (transfers) and as per commitments;

• Higher investments by GPs to improve social indicators;

• Greater local revenue mobilization;

• Improved monitoring and delivery of key services to rural population;

• More informed and higher expectations of rural households on rights and Panchayat

performance;

• Improved participation of households including the poorest in local planning and improved

targeting of poorer households;

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5. Strategy to Achieve Development Objectives:

In order to achieve these objectives the project has adopted the following strategy:

3.3 Block grants to Gram Panchayats The project would finance Block grants to 1343 GPs in 39 ‘Most Backward Talukas’ identified in

the Nanjundappa Committee Report. The block grants would finance activities and services listed in

Grama Panchayat plans (Annexure 15 and Annexure-16) and budgets based on the obligatory

functions( Section 58 of KPR Act 1993) and sector-wise activity mapping. To be eligible for the

grants GPs would have to put in place the new Financial Management and Accounting System

prepared by the State, implement the new planning guidelines, and hold regular Gram Sabha

meetings with open participation. In the first year 1343 GPs would get about Rs.600,000 on an

average as transfer on the basis of formula. This would be Rs.800,000 in second year,

Rs.1,000,000 in third year, Rs.800,000 in fourth year and Rs.600,000 in fifth year. The

disbursement of Block grants is explained in para 13.

3.4 Information Systems for Constituents

In this component, the Grama Panchayat will evolve a system of reporting information to the public

generally. This is aimed to increase the ability of rural people to voice their demands on local

governments and elicit responses from them, in particular for the poorest and excluded people such

as women, scheduled castes and scheduled tribes. Karnataka has a large number of community

organizations such as women self help groups, watershed associations, drinking water committees,

and others. The Project would be built on this strength by providing further support to such groups

or by assisting new groups to be formed. Work-site related information system would also be

planned as regards the persons employed, man days created and expenditure on the project.

3.5 Human Resource Development and Capacity Building of Panchayats

The project departs from the traditional ways of government functioning. It is, therefore, necessary

that all the people involved in the implementation of the project should have clear understanding of

the project strategies along with active participation, involvement and motivation. In order to ensure

this multi focused development of the Project, staff as well as related institutions HRD is a primary

concern of the Project. The Project would increase the capacity of all three levels of Panchayats in

managing resources, collecting revenues and delivering services. Specifically it would include:

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3.5.1 Creation of GP resource cells at the Taluk level The resource cells would provide expertise in the form of resource personnel/institutions for

planning, monitoring, information systems, community mobilization as well as accounting

functions. The TORs will be prepared separately for each of these functions. It will organize

assistance of Accounts personnel/professional institutions to assist in the preparation of Annual

accounts; computer and information systems personnel/institutions to assist in computerization and

computer-based communication systems, software development and NGOs for social organization

and mobilization. These cells would also assist GPs in implementing GoI centrally sponsored anti-

poverty schemes, state anti-poverty and vulnerable group schemes, and with the management of

the environmental framework for GPs. These cells will also play an important monitoring function.

3.5.2 Service delivery monitoring system This activity would support the Planning Unit of Zilla Panchayats in administering an annual

survey of service delivery standards at the GP level. The survey would be done by the GP under

guidance and supervision from the District and would monitor service delivery issues and

outcomes including health profile of the population, student and teacher attendance, drinking water

and sanitation coverage, and others. This survey would also be the instrument to collect baseline

data and information for the final impact evaluation. It would include questions intended to

measure the level of satisfaction of rural constituents with service delivery by the PRIs.

3.5.3 Training programs for Panchayats through ANSSIRD The training programs described below would be targeted at elected representatives and staff of

Panchayats. Feedback and issues raised by participants in face-to-face training mode and through

satellite will flow back to the Rural Development and Panchayat Raj Secretariat so that it becomes

part of a process of change and improvement in the Panchayat system with the active participation

of all the stakeholders involved. While the detailed training programme envisaged is annexed as

Annexure-4, the following are its key aspects:-

• Training of the magnitude envisaged will require the development of a variety of material on

all aspects of development, be it agriculture and irrigation, animal husbandry and fisheries,

watershed, industry, energy, housing, transport, education, health, drinking water and

sanitation, etc. Gender and caste equity will be a cross cutting theme across all the material

developed. A variety of material has already been developed as part of the literacy and

continuing education program by a number of agencies, including among others, the State

Resource Centre for Adult Education, Kuvempu University, Bharat Gyan Vigyan Samiti,

Mahila Samakhya and other NGOs.

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• ANSSIRD will set up a Committee of Experts for identification of material to be prepared. The

Committee will comprise writers, Panchayat and NGO representatives, artists and designers.

ANSSIRD will aim at providing a set of 50 titles to all Gram Panchayat in its effort towards

promoting adult education and continuing education. ANSSIRD will also bring out a variety

of charts, wall newspapers and posters in various aspects of poverty alleviation and

development for dissemination to all gram panchayats. In addition, to the existing film

material, a series of films will be created inter alia on the following issues:

��Panchayat raj, poverty alleviation & food security – inter-linkages between income,

work, food, nutrition, health, HIV.

��Feminization of poverty – caste, gender and bonded labor

��Vulnerable groups in agriculture

��Poverty alleviation, credit and access to resources

• The new film material will be developed through workshops. They will be derived from the

experience of elected gram Panchayat members, discussing and thinking about what they bring

out, and considering lessons for one’s own gram panchayats. The film will not be pre-scripted.

There will be no expert lectures. The films will reflect the lived experience of elected gram

Panchayat members. Gender and caste equality will be a cross cutting theme. The format will

include workshop discussions, individual interviews and dramatized plays. Wherever possible,

NGOs will be involved in developing the film material.

• To develop case study material for the training programs, ANSSIRD will take up an action

research program. The case studies will develop best practices and guidelines for various

aspects of Panchayat decision-making including:

��Panchayat functioning in all aspects;

��Effective community participation with reference to Gram Sabha, Ward Sabha,

functioning of committees

��Partnering amongst functionaries, Gram Panchayats and people

��Planning and implementation

��Acts, policies, circulars, etc which are in existence but either not put into practice or not

practiced effectively

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��Constraints faced in effective decentralization – due to non-existent or conflicting Acts,

policies, circulars, etc

��Attitudes, insecurities and related parameters in dual reporting by functionaries – to the

elected bodies and to the parent departments.

��Attitudes, practices, beliefs with reference to existing provisions of reservation, gender

equity, community participation with reference to Gram Sabha / Ward Sabha, the

politics / class / caste aspects involved at various stages

��Attitudes, practices, beliefs in partnering efforts between elected representatives,

functionaries, community based organizations, NGOs and people – the essential

requirement in decentralization

��Constraints faced due to lack of clarity / interventions by multiple tiers of the legislature

and the executive viz. at the Taluk Panchayat, Zilla Panchayat and state level.

��Assessing the needs with reference to capacity building of all stakeholders mentioned

above

��Innovative approaches in sectoral functions

��Formation of committees at taluk / district / state level to address the various issues

arising during the project period and to take effective measures to translate the findings

for the benefit of the whole state

��Gram Panchayat functioning on various aspects viz. funds (block grants and tied) and

management, community participation (Gram Sabha / Ward Sabha), committees,

reservation, tax collection, etc

��Development indicators in health, education, childcare, primary sector, social justice,

etc and their relation to the functioning of the respective sectors (including partnering

with the Gram Panchayat and the community).

3.5.4 Training of Government staff In this activity key personnel at State & PRIs and Training Institutions will be trained in such

essential project components as computerization, environmental guidelines, monitoring &

evaluation, Participatory Methods.

3.5.5 Computerized financial management system for GPs These activities would help implement many of the recommendations of the State Public Financial

Accountability Assessment (SFAA), namely by putting in place a new financial management

system (accounting, reporting, auditing) for GPs; this would also include computerization of all

GPs/TPs/ZPs and development of relevant software and IT training. The objectives of the

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computerization is to facilitate online communication of documents and data in the form of

reports, web-based data entry or email-enabled system of entry of standard reports, computerized

accounting system, management of property-taxes and cesses at Grama Panchayat, interaction with

citizens over email and facilitating electronic submission of applications by citizens, providing

information to citizens on the activities of the grama Panchayat, development of web-site for

facilitating information dissemination. All GPs would be computerized and would also assist with

development of appropriate software. The roll over of cash to accrual accounting as envisioned by

the State in the new Accounting Guidelines proposed for the GPs would be supported under this

activity. Circular instructions are issued to the GPs on the procedure to be adopted in the purchase

of computers along with a suggestive configuration. The same is Annexed as Annexure-5. The

necessary Software are being developed by the State National Informatics Center, Government of

India. TRC will provide personnel for computerized financial management to GPs by procuring as

per TORs framed for this purpose.

3.5.6 Environmental framework for Panchayats In this component, Grama Panchayats on their own or with the assistance of NGOs assess the

environmental impact of all the projects and discuss the same in the grama sabhas. The projects

taken up under the project and funded from the project will have to address environment impact

and provide for mitigating its adverse impact. The process of assessing the environment impact is

based on the ‘Environment Guidelines’ formulated under the project and is actualized through a

system of ‘okay cards’ to assess the impact on environment parameters. Adequate training /

capacity-building for the implementation of the Guidelines has also been included. The guidelines

will be translated in Kannada and made available to the GPs. To ensure effective implementation

of the Environmental Guidelines, the project will have a full-time, state-level environmental

officer.

3.6 Building the capacity of the state

The project implementation, deals with State level policy and coordination matters, assesses GP

performance in targeting the poor and based on that, makes budget allocation decisions. This

activity would put in place systems at the state level to enable it to oversee, facilitate and manage

the Panchayat system. It would further, put in place key mechanisms at the State level to enhance

the State’s capacity to monitor, facilitate and guide the Panchayat system. It would include a

Decentralization Cell in the Department of Finance, a Panchayat Monitoring System at the State

level, special policy studies, strengthening ANSSIRD and Technical Assistance for the

Restructuring of State Line Agencies. Specifically it would include:

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3.6.1 Decentralization Analysis Cell (DAC) This cell will be established in the Finance department as the Research Cell for PRIs. It will

monitor fiscal flows to the PRIs, assess the generation of own revenues and service delivery, carry

out studies and policy analysis including design of formulas for transfers, efficacy of various tied

and untied grants, advise the state on fiscal matters pertaining to Panchayats and support State

Finance Commissions when these are operating. An Annual publication titled the ‘Karnataka –

State of PRIs Report’ would be the output of the Cell. The first publication will be in Jul-Sep

2007. Duties and functions of the DAC is annexed as Annexure-6.

3.6.2 Strengthening of the State Institute for Rural Development The ANSSIRD will have overall responsibility over the capacity building activities. It would run

the Satellite Facilities, the distance learning programs, the face-to-face training, contract out the

installation and equipping of the Taluk Resource Centers and maintain and operate these centers or

ensure that Taluk Panchayats assume their O&M through appropriate agreements. The SIRD

would also carry out special studies to generate information for the training programs. This activity

would finance equipment for the ANS-SIRD campus in Mysore and the creation of ANS-SIRD

relay facility at Hubli, Gulbarga, Davanagere and Bangalore and training centers at the taluk level

equipped with audio-visuals.

3.6.3 Restructuring of line agencies This component would provide technical assistance to state line agencies for the design of their

institutional restructuring towards new roles in a decentralized service delivery framework.

6. Institutional and Implementation arrangements The Rural Development & Panchayat Raj Department (RDPR) and the Finance Department GoK

would be the primary agencies responsible for Project Implementation. They would work in

conjunction with other bodies such as State Institution of Rural Department, the Energy department,

and the Environment department as appropriate. The day-to-day programme implementation

responsibilities are at the Panchayat levels and in, particular with the GPs. RDPR would be responsible

for providing technical support to Gram Panchayats by the following institutional and implementation

arrangement:

6.1 Facilitation Cell (FC) in RDPR Department. The FC- Project Monitoring Unit in RDPR will assume overall responsibility for day-to-day project

management and coordination. The FC will monitor project implementation, issue project reports,

and prepare the Financial Management Reports for submission to IDA. The FC will ensure that

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project audits are done on time and as per specifications. In addition, the FC will contract an

Environmental Agency to assist with implementation of the transitory Environmental Framework

and prepare an Environmental Framework for Panchayats. The FC will be staffed with a Project

Coordinator, a Financial Management Specialist (with qualifications acceptable to IDA), and a

Local Government Specialist. The FC will also monitor Panchayat conformity with Government

Orders, in particular to those pertaining to the Financial Management and Accounting System1 and

Planning Guidelines. The FC will provide Technical Assistance to district, taluk and Gram

Panchayats on any matters related to the project that might arise beyond the capacity of the

Panchayats. The FC will also assist Taluk Panchayats in assessing their human resources to ensure

that at the minimum, each taluk is staffed with an computer engineer, an accountant and a social

specialist. Where necessary the FC would assist the Taluks recruit these resources through staff

transfers and deputation, or by outsourcing. The details of FC’s responsibilities in monitoring the

project are set out in detail at ‘Fiduciary Management’ .

6.2 Department of Finance and RDPR. The Department of Finance and RDPR would have overall responsibility over the Decentralization

Analysis Cell (DAC). The Decentralization Cell will design and manage the Equalization Formula

for transferring funds to Panchayats, will design and manage the Fiscal and Service Delivery

Monitoring System for Panchayats, will carry policy analysis of specific aspects such as own

revenues and others, and will provide assistance to the State Finance Commission when it would

start to operate. The Project Coordinator in FC would also be a member of the DAC.

6.3 State Institute for Rural Development. The SIRD will have overall responsibility over the capacity building activities. It would run the

Satellite Facilities, the distance learning programs, the face-to-face training, contract out the

installation and equipping of the Taluk Resource Centers and maintain and operate these centers or

ensure that Taluk Panchayats assume their O&M through appropriate agreements. The SIRD would

also carry out special studies to generate information for the training programs.

6.4 District Panchayats. District Panchayats, through the District Planning Cell, would monitor the planning process of

Panchayats to ensure that they follow the guidelines and, through Gram Panchayats, would carry

1 Karnataka Panchayat Raj (Gram Panchayat Accounts and budget) Rules-2006, Karnataka Panchayat Raj (Taluk

Panchayat Finance and Accounts ) Rules-1996, Karnataka Zilla Panchayat (Finance and Accounts ) Rules-1996,

Karnataka Financial Code-1958 And GOs issued from time to time.

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out annual surveys of service delivery and disseminate findings for all the Panchayats within the

district. It would also collate the fiscal information from Panchayat accounts, and transfer the

information on service delivery and fiscal performance to the Decentralization Cell.

6.5 Taluk Panchayats. Taluk Panchayats, where agreed with the SIRD, would assume responsibility for O&M of the taluk

resource centers. The taluk centers would be a space for training activities, for hosting the taluk

experts, and for receiving Gram Panchayat members for consultations and business. Each taluk

would be staffed with at least a computer specialist (to assist GPs in computerisation), an

accountant (to review the extent to which Gram Panchayats are following the Financial Guidelines,

to provide assistance on the matter where needed, and to collate Panchayat accounts at the block

level for transfer to the district), and a social specialist (to assist Panchayats where the planning

participatory process and mobilize the poorest and vulnerable groups to attend Gram Sabhas and

Ward Sabhas).

6.6 Gram Panchayats. Gram Panchayats will make expenditure decisions as per the Activity Mapping and the annual plans

to be implemented following the new Planning Guidelines and in a participatory and open manner.

The plans would consist of activities related to service delivery and could include both capital

expenditures and recurrent costs, but they would need to be consistent with the Activity Mapping.

For capital expenditures they would also implement the subprojects (by contracting out or relying

on community groups) and where necessary assume O&M responsibilities (if not assumed by

communities). GPs would maintain accounts send reports to the taluk offices. They would also

carry out annual service delivery surveys under the oversight of district Panchayats. GPs would

undergo extensive training and sensitization to ensure that they have the capacity to carry out their

responsibilities under the project.

6.7 Gram and Ward Sabhas. Gram and Ward Sabhas would be the instrument of accountability to the people. These would be

carried regularly as per guidelines and would approve plans and budgets of GPs and review the

GP performance. The social specialist at the taluk level would ensure ample and active

participation of the poor and vulnerable in Gram and Ward Sabhas.

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6.8 Social: Ensuring marginalized groups participation The Karnataka Panchayat system includes several aspects that are positive to marginalized groups

such as women, scheduled tribes and scheduled castes. The following are the important factors that

ensure benefits to the marginalized people.

First and most important are the reserved seats in GPs. Evidences are available that

reservation has resulted in higher benefits for marginalized groups and that women

representatives are not mere puppets manipulated by men.

Second, the Planning Guidelines for Panchayats recently adopted by the State bring excluded

groups (women, dalits, tribal people) to the center stage of the planning process ensures their

inclusion and the targeting of expenditures to them.

Third, state expenditure guidelines for Panchayats require that 20% of the expenditures be

used for the benefit of scheduled castes and tribes.

Fourth, the 39 target taluks in the project have the higher concentration of poor dalits and

tribal people.

Fifth, the proposed formula for transfers would assign higher transfers to Panchayats with a

higher percentage of vulnerable groups. This indicator would in fact be the proxy for poverty

and,

Finally, the program envisages information for vulnerable groups and increasing the capacity

of their organizations.

The project would ensure ample and active participation of the poor and vulnerable in Gram and Ward

Sabhas as a reporting mechanism is devised in the fiscal transfer system making their implementation

a condition for the financing of block grants for GPs.

7. Monitoring and evaluation of outcomes/results

7.1 Monitoring Monitoring would be the responsibility of several agencies. A state level steering committee under

the chairmanship of the Additional Chief Secretary & Development Commissioner will be

constituted to review and oversee the implementation of the project. The progress of the

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implementation of the project will also be reviewed in monthly KDP and MMR meetings held at

Taluk, District and State level apart from review in standing committee and General body meetings

of GPs.

The Decentralization Cell would monitor fiscal flows, own revenues and service delivery

aggregating data collected at lower levels. The RDPR would outsource the monitoring of the

quality of Gram Sabhas. District Panchayats would monitor service delivery at the Gram Panchayat

level. Gram Panchayats would put together accounting data and data on service delivery at the GP

level. Monitoring covers inputs, outputs and outcomes, performance of sub projects organizations,

project processes and impacts. The project will make an effort to prepare a systematic account of

project deficiencies/failures for learning purposes. For this, the project will critically examine its

activities, appraise activities carried out by institutions, understand and evaluate the project

thoroughly, identify the “best practices” and adopt them in the project. Proposed key output

indicators are:

��Increase in discretionary funds at disposal of poorest Gram Panchayats disbursed

according to formula;

��90% of GPs implementing planning guidelines;

��Computerized financial management system in place in at least 5,000 GPs.

��Annual “State of Gram Panchayat Fiscal and Service Delivery Reports” published starting

in 2007.

��Taluk training and resource centers operational in at least 50 taluks including the 39 poorest

taluks.

��Fiscal cell in the Finance Department created and fully staffed including at least one

representative from RDPR.

��Gram Panchayat revenues, expenditures, and procurement decisions, publicly disclosed in

90% of GPs.

��Panchayat budgets executed according to plans and procedures.

��Timely transfers to GPs equal to entitlements and budgets;

7.2 Evaluation Evaluation would be outsourced to an independent agency. A recently completed Rural Census will

provide the preliminary information for the baseline. If additional data are required, additional

questionnaires will be prepared and the data will be collected to complement the rural census. At

least two more of this census will be done during the duration of the project to provide the

GS-KPSP

17

information to carry out the evaluation. In addition the independent evaluators would sample the

quality of the surveys on service delivery being administered by village and District Panchayats.

The key impact indicators are

��Formula based, equalizing, transfer system adopted by the state and legal instrument issued;

��Increased own revenue effort (200%) and potential (100%);

��Regular Gram Sabhas meeting participation and inclusion parameters in 90% of GPs;

��Number of state schemes channeled through Panchayats reduced to less than 200.

��Capital investment of 20% poorer Panchayats increases by 500%.

��Improved household perception of quality of services delivered by GP

8. Fiduciary Management As stated in the above paragraphs, the overall responsibility for financial management will vest with

the Facilitation Cell (FC)/Project Monitoring Unit in the RDPR. The FC will be staffed with a

Financial Management Specialist (FMS), who will be in place throughout the life of the project.

The FMS will be responsible for:

��Ensuring that financial management arrangements including accounting, financial

reporting, internal control, oversight and submission of accounts to audit are

satisfactory, in accordance with relevant state government requirements and project

Legal agreements.

��Compile Annual Project Financial Statements (AFS) based on accounts maintained

by various project-implementing agencies. All implementing agencies will maintain

accounts using mainstream government accounting systems and report expenditures

monthly to provide a basis for compilation of the AFS.

��The majority of project expenditures will be made by GPs under project component.

Block Grants (BGs) components, amounting to 85%, will be accounted for in the

books of GPs in accordance with the new Budget and Accounts Rules to be issued

by GoK.

��The AFS will report the total amount of BGs quarterly/annually and these will be

tallied with the BG transfers reported as a single line item in GoK accounts

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18

annually. The remaining 15% expenditures will be made by the other implementing

agencies, namely, Project Monitoring Unit, Decentralization Cell (DAC), the Abdul

Nazir State Institute for Rural Development (ANSSIRD), and Taluka Panchayats

and these expenditures will be accounted for in their accounts.

The main challenge to satisfactory financial management is the poor quality of accounting and

financial reporting at the GP level. However, these weaknesses will be overcome by instituting a

fiduciary framework for the BG component comprising of:

��Directives from RDPR that BG be used funds only on eligible activities.

��Approval procedures ensuring that the proposed uses of BGs are approved by the Gram Sabha

and RDPR will confirm that proposed uses were properly approved by the Gram Sabha before

release of BG funds;

��Directives from RDPR ensuring roll out of the FM reform which will in turn ensure the

appropriate accounting of BG funds in the books of the GP and

��Assurance on end use of BG funds through audit and social accountability mechanisms.

These measures would instill fiscal discipline in the GPs and in achieving crucial public financial

management reforms at the GPs in line with the overall objective of the program of improving the

capacity of rural governments to manage public resources responsibly and effectively.

7.3 Fund Flow Arrangement: Funds shall be released to all the implementing agencies (GPs, TPs, SIRD and DAC) from the

State (FC) in 4 quarterly installments of 25% each on the basis of Approved Action Plan indicating

activity wise budget for the project implementation.

8.2 Release of Funds to GPs:

A major portion of project fund will flow to GPs (about 85%). State shall make direct release of

funds through the banks to the project implementation bank accounts of the GPs. This is the same

procedure as followed for the release of statutory grants to the GPs.

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19

Procedure for release of Quarterly Grants to GPs is detailed as below:

��1st installment of fund shall be released in advance on the basis of Approved Action Plan for

project implementation.

��2nd installment shall be released after utilizing 75% of 1st installment amount and on

furnishing utilization certificate duly signed by the Adhyaksha (President) and Secretary of

the Gram Panchayats.

��3rd installment shall be released after utilizing entire amount of 1st installment and 75% of

2nd installment as per utilization certificate furnished by the Adhyaksha and Secretary of the

Gram Panchayats.

��4th installment shall be released after entire amounts of 1st and 2nd installment are utilized

and 75 percent of the 3rd installment is utilized. The Adhyaksha and Secretary of the Gram

Panchayats must certify this utilization in the utilization certificate. Another prerequisite for

the release of 4th and final installment of fund is obtaining certificate from the GP Engineer

to the effect that physical progress achieved in the civil works is commensurate with the

expenditure made.

3.3 Release of Funds to other implementing agencies namely, TPs, ZPs, SIRD and DAC:

Grants for these implementing agencies also shall be released in 4 equal installment on the basis of

the amount mentioned in the ‘Approved Action Plan’. State shall release the grants to these

implementing agencies through the State Treasuries. However ANSSID would operate accounts

through Bank.

Procedure for the release of quarterly installment of grant to the above agencies is detailed as below:

��1st installment of fund shall be released in advance on the basis of Approved Action Plan

for project implementation.

��2nd installment will be released after 75percent of 1st installment is utilized and upon

furnishing utilization certificate duly signed by the Executive Officer of TPs/CEOs of ZPs/

Director of SIRD/DDO of DAC, as the case may be.

��3rd installment will be released after the entire amount of 1st installment is utilized and

75percent of 2nd installment is utilized. The release will be as per utilization certificate

GS-KPSP

20

furnished by the Executive Officer of TPs/CEOs of ZPs/Director of SIRD/DDO of DAC, as

the case may be.

��4th installment will be released after utilization of entire amounts of 1st and 2nd installment

and 75percent of the 3rd installment. The Executive Officer of TPs/CEOs of ZPs/Director

of SIRD/DDO of DAC must certify the utilization. Obtaining physical progress report of

the Schemes/Programmes up to the end of previous quarter is another prerequisite for the

release of 4th and final installment of fund.

7.4 Books of Accounts Following are the basic of books of accounts to be maintained by the Gram Panchayats in respect of

project funds. These books of accounts shall be in the forms as prescribed in the revised Karnataka

Panchayat Raj (Gram Panchayats Accounts and Budget) Rules 2006;

a Cash book Form No.50 b Journal book Form No.52 c General ledger Form No.54

In connection with the project implementation some other books of Accounts/Registers/Formats

shown below also required to be maintained. They also shall be in the formats as prescribed in the

KPR (Gram Panchayats Accounts and Budget) Rules 2006,

In TPs, ZPs, SIRD and DAC the Books of Accounts and Register shall be maintained as prescribed

under KPR(Taluk Panchayats Finance and Accounts) Rules 1996, KPR(ZP Finance and Accounts)

Rules 1996 and KFC 1958 as the case may be. However separate Ledger Account shall be

maintained in these institutions to facilitate preparation of Receipt and Payment Accounts, Annual

Financial Statement and Reimbursement Claims.

1 Asset Register Form No.28 2 Stock Book Form No.29 3 Register of estimate Form No.32 4 Work order Form No.33 5 Measurement book Form No.34 6 Work Register Form No.36 7 Work completion report Form No.37 8 Receipt and payment account Form No.55 9 Trial Balance Form No.56 10 Action on Audit Report Form No.60

GS-KPSP

21

7.5 Returns to be submitted by the implementing agencies Gram Panchayats shall render following returns to the EOs of TPs within the prescribed time as

shown against them.

Sl No

Nature of Return Due Date

1 Copy of cash book containing bank reconciliation statement

5th of the following month

2 Bank Statement (extract of pass book for the month) 5th of the following month 3 Receipt and Payment account 5th of the following month 4 Trial Balance 5th of the following month 5 Annual Action Plan indicating the budget

requirement for different activities during the year 30th April of that financial year

��The Taluk Panchayats shall compile the receipts and payments accounts of all the GP’s project

and its own and shall submit the same to the FC by 10th of the following month. They shall

submit the Annual Action Plan indicating the budget requirement for different activates during

the year by 30th April of that financial year.

��The ZP, DAC and SIRD also shall submit their monthly receipt and payment accounts by 10th

of the following month. They shall submit the Annual Action Plan indicating the budget

requirement for different activates during the year by 30th April of that financial year.

��The TPs, ZPs, SIRD and DAC shall send the reimbursement claim every month in the form

prescribed by the FCs before 15th of the following month to facilitate submission of

reimbursement application to Government of India. The reimbursement claims in respect of

GPs shall be consolidated by the TPs and sent to FC.

9. Audit

9.1 Internal Controls

��Controls on the Investment component expenditures will be exercised by the FMS at the FC

and through the prevalent state government controls on expenditures through TPs, GPs and

ANSSIRD. The persons responsible for making project expenditures will be the TP-Accounts

Superintendent S, GP-Secretary and ANSSIRD Accounts Superintendent, while the

responsibility for oversight will be that of the TP-EO, GP-Adhyaksha and ANSSIRD-Director.

��Controls on the BG funds will be through the fiduciary framework that is put in place in this

project. This framework will ensure that directives from the RDPR regarding the eligible

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22

expenditures for use of BG funds, that regular Gram sabhas are held to document the proposed

uses of BGs; that there are approval procedures in place which ensure that BGs are proposed to

be used only for the extension and expansion of services as envisaged under the 29 items

devolved to the GPs.

��Additional fiduciary reviews of a sample of GPs receiving Block Grants will be undertaken

annually by a firm of private accountants periodically during the implementation phase. The

purpose of these reviews will be to provide additional assurance of the controls at the GP level

and recommend strengthening actions if required. RDPR will create a panel of CA firms in

consultation with Karnataka State Accounts Department (KSAD) from which the reviewers

will be selected. This panel may be either at the district level or at a regional level2 to conduct

these special reviews in which both financial management and procurement will be covered at

the GP level.

��For the purposes of monitoring, capacity building and assurance on end use of BG funds, the

RDPR will monitor the Consolidated audit report of GPs receiving Block Grants audited by

KSAD.

9.2 External Audit

��For fiduciary purposes the following report will be received by the Bank and monitored in

audit report compliance system:

��Audit of AFS / FMRs (all components). ��These will be audited by a firm of private Chartered Accountants annually.

9.3 Financial Management & Terms of reference for audit: The suggested terms of reference of the different audits is annexed as Annexure-7 to 11.The

Financial managements and disbursement arrangements is annexed at Annexure-12.

10. Procurement All the aforesaid project components involve procurement of goods, works and services on a

decentralized basis by the concerned PRIs/implementing units as per their delegated financial powers.

The procurement of goods and services will follow the Karnataka Transparency in Public Procurement

Act, 1999 and The Karnataka Transparency in Public Procurement (Rules) 2000 would guide with

respect to the procurement of goods and services by PRIs. The guidelines issued by the Government

2 GoK will develop criteria for selection of the audit firms and TORs describing the scope of the audit to be conducted.

GS-KPSP

23

regarding ensuring procurement through calling for quotations from registered/authorized

contractors/vendors only will be followed to ensure competition and transparency in all procurement.

These are mostly on the lines of Public Works Department. A detailed procurement manual prepared

and will be issued separately, This Procurement Manual will act as guidelines for the project

implementing agencies. The procurement plan for first 18 months period is part of the manual is

annexed as Annexure-13.

11. Project period and Project Finance: The total cost of the project is USD 133.33 million spread over a 5-year period. Out of the total cost of

the project, IDA credit would be USD120 million and Karnataka’s share is USD 13. 33 million.

USD 113.33 million would go towards financing block grants for GPs. The balance of project fund

would be utilized for capacity building, creation of resource centers, State Level Institutions to

monitor the project.,

The project funds would flow to the GPs in the 39 Most Backward Taluks identified in Nanjundappa

Committee. The funds would be allocated on the basis of a formula in order to equalize over fiscal

disparities and needs. Thus poorest GPs get more funds. Simultaneously, Government of Karnataka

would also ensure timely release of statutory grants of Rs 5 lakh to GPs in quarterly installments as

appropriate.

GS-KPSP

24

9.4 Details of Project Cost The following table shows the various components of project and their costs;

12. Disbursements The following indicators and weightages for devolution to PRIs will be adopted for allocating Grants

to 1343 grama panchayats in 39 ‘Most Backward’ taluks in the first year. Sl. No. Indicators Weightage (%)

a) Populaton and Area (60%)

1. Population 30

2. Area 30

b) Backwardness (40%)

1. Illiteracy 20

2. SC & ST Population 20

Total 100

Amount % Amount % Amount % Amount % Amount % Amount %

I Block GrantsGrants 510.00 100.0 - - 510.00 85.0 113.33 100.0 - - 113.33 85.0

II Goods, Works and Services

6.60 33.0 13.40 67.0 20.00 3.3 1.47 33.0 2.98 67.0 4.44 3.312.71 33.0 25.80 67.0 38.50 6.4 2.82 33.0 5.73 67.0 8.56 6.40.99 33.0 2.01 67.0 3.00 0.5 0.22 33.0 0.45 67.0 0.67 0.50.99 33.0 2.01 67.0 3.00 0.5 0.22 33.0 0.45 67.0 0.67 0.50.83 33.0 1.68 67.0 2.50 0.4 0.18 33.0 0.37 67.0 0.56 0.4

6 Action Research & Development 0.25 33.0 0.50 67.0 0.75 0.1 0.06 33.0 0.11 67.0 0.17 0.1Sub Total 22.36 33.0 45.39 67.0 67.75 11.29 4.97 33.0 10.09 67.0 15.06 11.3

III Incremental Operating Costs (FC &DAC)3.53 33.0 7.18 67.0 10.71 1.8 0.79 33.0 1.59 67.0 2.38 1.81.32 33.0 2.68 67.0 4.00 0.7 0.29 33.0 0.60 67.0 0.89 0.70.50 33.0 1.01 67.0 1.50 0.3 0.11 33.0 0.22 67.0 0.33 0.30.98 33.0 1.98 67.0 2.96 0.5 0.22 33.0 0.44 67.0 0.66 0.51.32 42.9 1.76 57.1 3.08 0.5 0.29 42.9 0.39 57.1 0.68 0.5

Sub Total 7.65 34.4 14.60 65.6 22.25 3.71 1.70 34.4 3.25 65.6 4.94 3.71540.00 90.0 60.00 10.0 600.00 100.00 120.00 90.0 13.33 10.0 133.33 100.00Grand Total

Hiring of VehiclesInternal and External AuditOthers

4. Consultancies_TRCs5. Goods and Equipment

1.Salaries, TA & DA, ContigenciesConsultancies

1. Training and Capacity Building2. Civil Works3. Consultancies & Management - ANSSIRD

(Rs. Crore) (US$ Million)

ItemsIDA Government Total IDA Government Total

Project CostGram Swaraj -Karnaka Panchayat Strengthening Project

Disbursement Accounts by Financiers

GS-KPSP

25

From the second year onwards, the allocation will be based on these indicators and and also

performance indicators in the ratio 50:50. However these performance indicators could be modified

later based on the experience of implementation by the DAC.

The Performance parameters shall involve fiscal, governance and social parameters and broadly

include the following:

9.5 Fiscal Parameters Sl

No

Parameter

Weightage

in eligibility

for grants in

percentage

Percentage

variation

permissible

1 Collection of property tax and cesses to be at least 60%

during the first year, 65% in the second year, 70% in the

third year, 70% in the fourth year, 75% during the fifth year.

15

20

2 Property tax and cesses to be revised at least once in three

years.

5

Nil

3 Additional resource mobilization (other than taxes) i.e. from

assets, fees for services to increase by at least 10% (after

debt servicing, if any) eg. Income from license fees, renting

of property, information kiosks, incentive from recovery of

housing loans, promoting insurance for the poor, income

from lease of usufructs of plantations, tanks, fish ponds, in

common lands etc.

5

20

Sub-Total 25

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26

9.6 Institutional Governance parameters

1 Conduct of monthly meetings of Panchayat. 5 20

2(a)

2(b)

2(c)

Conduct of at least two ward sabhas in each ward each year

Conduct of Grama Sabhas for selection of beneficiaries in

all cases of individual benefits under government sponsored

programs in a transparent manner (at least two in a year)

Approval of action plans of programs in the grama sabhas

5

5

5

Nil

Nil

Nil

3(a)

3(b)

Conduct annual Jamabandi (social audit)

Compliance of the earlier Jamabandi report

2

2

Nil

50

4(a)

4(b)

����������� �������������������������������������������� ����������������������

� ���� !�� ���� �#"�$ ������������������%&�������

Report compliance of audit observations of the audit of

accounts of the previous year within six months of the close

of the year.

2

2

Nil

5 Intimation of property tax and cesses demand to property

holders and improving collection efficiency eg creation of

additional channels of payment of taxes and cesses as

through local bank or micro-finance system of the panchayat

or self-help group.

1

Nil

6 Prepare the panchayat budget before March each year

indicating the estimated income under various sources and

estimated expenditure.

2

Two months

7 Standing Committees of the Grama Panchayat to monitor

income and expenditure of the panchayat in respect of their

respective subjects and clear all expenditure of the

panchayat through resolutions at fortnightly meetings.

3 (One

percentage point

for each sub-

committee)

Nil

8 Grama Panchayat to ensure payment to suppliers of goods

and services to be cleared by the Panchayat within fifteen

days of the presentation of bills through Grama Panchayat

Standing Committee resolutions.

2

50

9(a)

9(b)

Formation of VWSC.

Collection of water rates/water charges

1

2

25

10 Payment of Electricity bills 10 25

Sub-total 49

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27

9.7 Social Indicators Sl

No

Parameter Weightage in eligibility for

grants in percentage

Percentage

variation

permissible

1 Total Sanitation Campaign (TSC)

Achievement of minimum of 25% coverage each

year.

5

50 in 1st year

25 in 2nd year

25 in 3rd year

10 in 4th year

5 in 5th year

2 Reduction of percentage of out-of school children

(50% of the remaining children each year)

5

25 in the first

three years.

10 in the last two

years

3(a)

3(b)

Immunization of children

Institutional Deliveries

3

2

5

20

4 Implementation of EGS/SGRY

Minimum 30% employment of women

5

Nil

5

(a)

(b)

Utilization of Minimum 20% Development fund

of Panchayat for SC & STs

Own funds

Project funds

3

3

Nil

Nil

Sub-total 26

Grand Total 100

Abstract

Suggested Parameters

Sl.No Indicators Weightage

1 Fiscal 25

2 Governance 49

3 Social 26

Total 100

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28

13. Eligibility for Grants under the project Only the panchayats that satisfy the fiscal and institutional governance parameters will be eligible for

the grant. There will proportionate cuts in the grant due to shortfall in fiscal parameters. Variations in

excess of the percentage prescribed will not entitle the Panchayat to any weightage on that parameter.

(‘Nil’ permissible variation means that no shortfall in that parameter is allowed)

14. Project Formulation and Preparation of Action Plans

Grama Panchayats have to prepare Perspective Plan for the Project period giving the details of sector

wise activities, aimed at providing services to the local people. The project report should contain the

details of all the state and centrally sponsored and central plan schemes implanted by the GPs in the

form of action plan for 2006-12.

The Grama Panchayat can take up any activity identified by them and approved in the Ward/Gram

Sabha. These activities should conform to functions devoted to GPs in Section 58 and Schedule 1 of

the Karnataka Panchayat Raj Act, 1993 and activities listed in the Activity Mapping. Activity Mapping

of PRIs is given in Annexure-15 and Annexure-16. A list of activity that are specifically excluded

are mentioned in Annexure-15.

The Government has formulated guidelines for preparation of perspective plans of Gram Panchayats,

which is referred to in Annexure-14. These guidelines are indicative. Gram Panchayats are free to

formulate their plans except those mentioned in the negative list mentioned in Annexure-15.

The project fund will be in addition to the grants received by the GPs under various schemes including

statutory grants of Rs. Five lakhs. Out of the Block funds provided under the project 80 percent should

be allocated and spent on the Capital Assets. Out of the balance up to 20 percent of the untied funds

may be earmarked for IEC and other service delivery activities. Revenue expenditure should not

exceed this limit and savings, if any, could be spent on capital works. The project fund should not be

spent on following revenue expenditure.

��Recruitment of staff.

��Sustainability of project after the project period is over.

��Payment of electricity bills.

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29

Using the BGs for any activities other than those specified will result in disallowances and GPs will

loose this amount in their grants to gram Panchayats (Section 206), which will be used to refund the

Bank.

While preparing the action plan the following care should be taken: -

• It is imperative that the project proposals should be identified as a need felt by the village

community and discussed in Ward Sabhas and approved by the Grama Sabha.

• After selecting the projects through a consultative process mentioned above, a ‘Detailed Project

Report’ (DPR) should be prepared for each project with the assistance of the concerned

government department. The DPR shall specify the location, technical feasibility, financial details

and the service and maintenance issue of the asset after the project period. Apart from these details,

the DPR shall also specify the following details:-

��Social purpose of the project and measurable indicators of present position and the likely

improvement expected on account of the project.

��Environment impact of the project and steps proposed in the project to mitigate the adverse

environment impact.

��Expected life of the asset or service created

��A detail about the sustainability of the asset after the project is over.

��Number of persons generally, and particularly women and SC/STs in the panchayat

expected to benefit or take advantage of the facility.

��Quantifiable benefits to the community on account of the facility.

��Creation of employment to the locals on account of the service/asset (not project).

After the preparation of the DPR, the same has to be discussed at the Gram Sabha and all the members

to be informed of the overall plan, technical feasibility, financial details, management strategies etc.

After obtaining their feedback and approval, the Gram panchyath should forward the project proposals

to the Executive Officer of the Taluka Panchayat. The Executive Officer will verify the components of

the project whether they confirm to the functions specified under Section 58 read with Schedule 1 of

the KPR Act 1993. The project funds will be released to the Grama Panchayat based on the report of

the Executive officer.

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30

After the funds are released for the project, the respective government department who had prepared

the DPR will extend the necessary technical supervision in the implementation of the project.

15. Budgets and Financial Controls Government of Karnataka has prescribed the accounting arrangements for Zilla Panchayat Funds and

Taluk Panchayat Funds vide Government Order No. FD 07 ZPA 2003 dated 8.9.2004. Accordingly the

Zilla Panchayat Fund shall be split into 3 district categories in each District as follows:

ZP Fund –I. Shall account for all receipts and expenditure of Central Plan & Centrally

Sponsored Schemes including their State share, non-plan Central Grants and grants under

Finance Commission’s recommendations. The fund shall have the 12 – digit code as “8448-00-

109-2-00”

ZP Fund –II Shall account for all receipts and expenditure in respect of all State Plan schemes

(other than matching share of CP/CS Schemes and all non-plan assistance received from State

Government). The fund shall have the 12-digit code as “8448-00-109-3-00”.

ZP Fund –III Shall account for all receipts and expenditure in respect of own funds of Zilla

Panchayats under Tax/Non-Tax Revenue, Earnest Money Deposits, Security Deposits and

exclusively State sector schemes implemented by Zilla Panchayats. The fund shall have the 12-

digit code as “8448-00-109-4-00”.

Grants in respect of certain centrally sponsored schemes are released directly to Zilla Panchayats and

they are remitted into bank accounts specified by Government of India.

Karnataka Panchayat Raj (Zilla Panchayat Finance and Accounts) Rules, 1996 have been issued

prescribing the procedure to be followed with regard to Receipts and Payments, Treasury procedure,

Compilation of accounts and Control of expenditure, Internal audit and other related matters.

As prescribed in section 196 of the Karnataka Panchayat Raj Act, 1993, the Chief Executive Officer of

Zilla Panchayat is responsible for drawl and disbursement of money from the Zilla Panchayat funds,

Chief Executive Officer can authorize any officer of the Zilla Panchayat to draw money out of Zilla

Panchayat fund and such officers are required to be placed in account with the treasury officers by the

Chief Accounts Officer of the Zilla Panchayat.

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16. Grants from State Government: The State Government, in its annual budget, provides for grants to the Zilla Panchayats for various

programmes under the State Plan and Non-Plan schemes under the district sector and also for the

establishment expenditure of the staff deputed to the Panchayats. Grants in respect of the State Plan

Schemes and Non-Plan Schemes are released to the Zilla Panchayats in quarterly installments by the

Finance Department. The State Government also releases state share in respect of certain Centrally

Sponsored Schemes.

17. Grants from Government of India: Grants in respect of some of the Centrally Sponsored Schemes and Central Plan Schemes are also

released to Zilla Panchayats. In case of Centrally Sponsored Schemes of Rural Development and

Panchayat Raj Department, Government of India share is released directly to the Zilla Panchayats. In

case of other schemes, grants are routed through the State Government and concerned departments in

the State Government release these scheme grants to Zilla Panchayats.

18. Operation of funds in Zilla Panchayats/ Taluk Panchayats/ Grama Panchayats:

18.1 Zilla Panchayats:

• A fund called ‘Zilla Panchayat fund’ is constituted in each Zilla Panchayat and it is

maintained in treasury as a fund distinct from the Consolidated Fund of the State.

• The Chief Executive Officer and Chief Accounts Officers of Zilla Panchayat have the

Primary responsibilities for operation of funds in the Zilla Panchayat. As provided in section

256 of the Karnataka Panchayat Raj Act, 1993, and rule 33 of Zilla Panchayat Finance and

Accounts rules, the Zilla Panchayats are required to prepare and approve Annual Budget

Estimates and send the same to the Government.

• The Chief Accounts Officer of Zilla Panchayat is authorised to draw the grants released

from the State Government from the consolidated fund of the State in treasury and credit it

to the Zilla Panchayat fund in the treasury. A Minor Head of Account namely 196 has been

opened in the State Budget as per the recommendations of the Eleventh Finance.

• The Chief Accounts Officer releases grants to the various district level implementing

officers and Taluk Panchayats. These Officers incur expenditure out of Zilla Panchayat fund

by drawing from Zilla Panchayat fund account in the treasury. In respect of certain

Government of India schemes, the Zilla Panchayats are requested to operate funds through

GS-KPSP

32

separate Bank Accounts. Accordingly, Zilla Panchayats and implementing officers maintain

and operate separate bank accounts for operation of such scheme funds.

• Some of the Officers of Zilla Panchayat, like Executive Engineer, Deputy Conservator of

Forest, District Social Welfare Officers are authorized to operate through cheques on Zilla

Panchayat fund. These officers render separate accounts of their drawls/expenditure from

the Zilla Panchayat fund.

18.2 Taluk Panchayats: • A Taluk Panchayat fund is constituted in each Taluk Panchayat and it is maintained as fund

distinct from the Consolidated Fund of the State and the Zilla Panchayat fund.

• The Karnataka Taluk Panchayat (Finance and Accounts) rules 1996, have been issued

prescribing the procedure to be followed with regard to Receipts and Payments, Treasury

procedures, Compilation of accounts and Control of expenditure, Internal audit and other

related matters.

• As provided in Section 156 of the Karnataka Panchayat Raj Act, 1993, the Executive Officer

of Taluk Panchayat is responsible to draw and disburse monies out of the Taluk Panchayat

fund. He may authorise such of the Officers who are required to implement Taluk Panchayat

schemes, to draw money out of Taluk Panchayat funds in treasury for implementation of

schemes. The Chief Accounts Officer of the Zilla Panchayat is required to place such

Officers authorized to draw money out of Taluk Panchayat funds in account with the

treasury officer. Annual Budget Estimates of the Taluk Panchayat are required to be

prepared, approved by Taluk Panchayat and sent to Zilla Panchayat by 25th March every

year.

• A Minor Head of Account namely 197 has been opened in the State Budget as per the

recommendations of the Eleventh Finance Commission. Government of Karnataka has

prescribed the accounting arrangements for Zilla Panchayat Funds and Taluk Panchayat

Funds vide Government Order No.FD 07 ZPA 2003 dated 8.9.2004. Accordingly the Taluk

Panchayat Fund shall be split into 3 distinct categories in each District as follows:

��TP Fund-I Shall account for all receipts and expenditure of Central Plan & Centrally

Sponsored Schemes including their State Share, non-plan Central Grants and grants

under Finance Commission’s recommendations. The fund shall have the 12-digit code

as “8448-00-109-6-00”.

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��TP Fund – II Shall account for all receipts and expenditure in respect of all State Plan

schemes (other than matching share of CP/CS Schemes and all non-plan assistance

received from State Government). The fund shall have the 12-digit code as “8448-00-

109-6-00”.

��TP Fund – III Shall account for all receipts and expenditure in respect of own funds of

Taluk Panchayats under Tax/Non – Tax Revenue, Earnest Money Deposits, Security

Deposits, Additional Stamp Duty and exclusively State Sector Schemes implemented

by Taluk Panchayats. The fund shall have the 12-digit as “8448-00-109-7-00”.

• Executive Officers of Taluk Panchayats are authorized to draw the grants from Zilla

Panchayat fund and credit it to Taluk Panchayat fund in treasury. Subsequently, the

Executive Officers of Taluk Panchayats release the grants to the other implementing officers

at the Talk level for implementing of various Taluk Panchayat schemes. Taluka level

implementing Officers incur expenditure out of Taluka Panchayat fund by drawing bills

through distinct vouchers from Taluk Panchayat fund. In respect of certain Government of

India schemes, where the funds are required to be operated in separate bank accounts,

Executive Officers of Taluk Panchayats are authorized to maintain separate bank accounts

and incur expenditure out of these accounts. Separate cashbook and accounts are required to

be maintained for each of these bank accounts.

18.3 Gram Panchayats: • In order to streamline fund flow to the Grama Panchayats, a mechanism of direct releases of

Government devolutions through Banks has been put into place with effect from November

2004. The arrangement for making direct releases through Banks involves six nationalized

Banks and 12 Grameen Banks. A Minor Head of Account namely 198 has been opened in

the State Budget as per the recommendations of the Eleventh Finance Commission.

• The Karnataka Grama Panchayat (Budget and Accounts) rules 1995, have been issued

prescribing the procedure to be followed with regard to Receipts and Payments, Treasury

procedures, Compilation of accounts and Control of expenditure, Internal audit and other

related matters.

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19. Annexure-1

Most Backward Taluks by District

District Taluk Bagalkote Bilagi Bangalore Kanakapura

Magadi Bellary Kudligi

Sandur Bidar Aurad

Basavakalyan Bhalki Humnabad

Bijapur Basavana Bagewadi Indi Muddebihal Sindagi

Chamaragnagar Chamarajnagar Chitradurga Hosdurga Davangere Channagiri

Harapanahalli Gulbarga Afzalpur

Aland Chincholi Chithapur Jewargi Sedam Shahapur Shorapur Yadgir

Kolar Bagepalli Koppal Kushtagi

Yelburga Mysore Heggadadevankote Ralchur Deodurga

Langasugur Manvi Sindhanur

Tumkur Gubbi Kunigal Madhugiri Pavagada Sira

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20. Annexure-2 Framework of Output Monitoring

PDO Outcome Indicators Use of Outcome Information Improve the effectiveness of service delivery by Karnataka’s Gram Panchayats (village governments) particularly with respect to the management of public resources and the delivery of relevant services that the rural people decide and prioritize.

Rising number of Gram or Ward Sabhas with high and representative participation and relevant agendas Rising satisfaction of village residents with service delivery by Gram Panchayats Gradual increase in own-source revenue and stronger financial health of village governments

Independent monitoring Annual service delivery surveys Panchayat accounting system

Intermediate Results One per Component

Results Indicators for Each Component

Use of Results Monitoring

Component One: Block grants for Gram Panchayats

Component One: Increased block grants to poor Panchayats equal to IDA disbursements based on formula Panchayat budgets executed according to plans and procedures Timely releases equal to budgets and entitlements

Component One: Panchayat accounting system and government budget Independent monitoring Panchayat accounting system and government budgets

Component Two: Building the capacity of constituents

Component Two : GP revenues, expenditures, and procurement decisions publicly disclosed in 90% of GPs

Component Two: Independent monitoring

Component Three: Building the capacity of Panchayats and state

Component Three: Number of trained members and periodicity Taluk training centers Fully staffed decentralization cell Improved financial management system available in at least 5,000 GPs

Component Three: Project monitoring system

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21. Annexure-3

Arrangements for results monitoring

Target Values Data Collection and Reporting Outcome

Indicators Baseline YR1 YR2 YR3 YR4 YR5 Frequency

and Reports

Data Collection

Instruments

Responsibility for Data

Collection Rising number of Gram or Ward Sabhas with high and representative participation and relevant agendas Rising satisfaction of village residents with service delivery by GPs Gradual increase in own-source revenue and stronger financial health of village governments

NA NA US$6 million

20% 20% US$8 million

40% 40% US$10

60% 60% US$12

60% 60% US$14

60% 60% US$16

Annual Annual Annual

Independent monitoring Service delivery surveys Accounting system

Department Panchayats Zilla Panchayat Panchayats and decentralization cell

Results Indicators for

Each Component

Component (1) Increased grants to poorer Panchayats equal to IDA disbursements based on formula Panchayat budgets executed according to plans and procedures Timely releases equal to budgets and entitlements

0% 0% 50%

100% 50% 70%

100% 70% 100%

100% 90% 100%

100% 90% 100%

100% 90% 100%

Annual Annual Annual

Accounting system and state budget Accounting system and independent monitoring Accounting system and state budget

Decentralization Cell Decentralization Cell Decentralization Cell

Component (2) GP revenues, expenditures and procurement decisions publicly disclosed

NA 30 60 70 80 90 Annual Monitoring system

RDPR

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22. Annexure-4

Summary of Training Programme for Panchayats

Sl.No. Target Group

Content of Training Mode

A

Gram Panchayat Members ( 91,402)

I . Two days Module - Phase – I ��History of Panchayat Raj �� Principles of Decentralisation �� 73rd Constitutional Amendment ��KPR Act 1993 ��Reservation & Rotation ��Ward/ Gram Sabha �� Panchayat meetings

1. II. Three days Module - Phase – II �� Panchayat functioning ��Collective action �� Jamabhadi ( Accountability) �� Perspective planning ��Resource Mobilisation ��Management of Power sector

III. Three days Module - Phase – III ��GP & Education

- Pre. Primary ( ICDS) - Primary - Adult LIteracy

��GP & Water and Sanitation ��GP & Health

- RCH - Disability - HIV / AIDS

1. Three days Module - Phase – IV • Agriculture & allied activities • Watershed Development • Management of Common property Resources

Satelllite – 2 days Satelllite – 3 days Satelllite – 3 days Satelllite – 3 days

B Gram Panchayat Members ( 91,402)

I.. Three days Refresher Course : ��Accountability

- Jamabhandhi - RTI Act

• Perspective planning - PRA Techniques - Ward/ Gramsabha - Preparing Plan document

II.. TOT for RPs.

• Perspective planning & PRA Techniques • Accountability • Research & Documentation

Satelllite – 2 days Field Exp. – 1 day Face to Face - 10 days (2+2+3+3 days)

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C ZP/TP members (1005+3683) 9 - one day modules 1 – two days module 2 – three days module

I. One day module ( 9 transmission) 1. Decentralisation & Development 2. Panchayat Raj & Poverty Alleviation 3. Panchayat Raj & Water and Sanitation 4. Panchayat Raj & Watershed Development 5. Panchayat Raj & Health 6. Panchayat Raj & Education and Child Labour 7. Panchayat Raj & Agriculture and allied 8. Panchayat Raj & Social Justice 9. Panchayat Raj & Information Technology

II. Two days module (1 one transmission) 1. Panchayat Planning & Budget

III. Three days module (4 transmission) 1. Priniciples of Decentralization 2. 73rd Amendment & KPR Act 1993 3. ZP/ TP Meetings 4. Functions of Standing Comittees 5. Role & Responsibilities of Ahyakshas/

Upadhyakshas 6. Role & Responsibililty of CEO’s 7. RTI Act – 2005 8. Perspective Planning

9 days Satellite Transmission (one day each) 2 days Satellite Transmission 3 days Satellite Transmission (four transmission)

D Gram Panchayat Secretaries (5652 panchayats)

I. Two days module (2 transmission) • Accountability

- Jamabhandi - RTI Act

• Perspctive planning - PRA Techniques - Ward/ Gramsabha - Preparing Plan document

2 days Satellite Transmission

E RDED Engineers (1700)

I. 2+2 days module (3 transmission) ��Implementation of Dev.programmes before &

after PRI system ��Priniciples of Decentralization ��73rd Amendment & KPR Act 1993 ��Planning & Execution of People centric

deve.works ��Accountability

2+2 Satellite Transmission / Cascade mode

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F Management

of SGSY/ SHG (30,000)

Two days module (ten transmission) • Understanding of rural poverty • Eradication of rural poverty • Role of SHG/ SGSY in eradicating rural

poverty • Challenges faced in implementing SHG/ SGSY

programme • Strategies in effective implementation • Marketing of Micro Enterprise products

2 days Satellite Transmission

G Training of AWW/ANMs (63,100)

Two days module (twenty transmission) • Rural health scenario • RCH related issues • Role of AWW/ ANMs in creating awareness in

health issues • Co-ordination with PRIs

2days Satellite Transmission

H Development of training materials

• Charts & Posters • Training Modules • Self Reading Material • Wall News Paper • Electronic Material (Films, CDs, VCD, VHSs )

On Accounts and Computerisation of Accounts

Sl.

No Target Group Content of Training Mode

Training of Accounts

I Training of Trainers 6 Resource Persons will be selected from each district and they will be exposed to various aspects, personnel management, financial management, material management and other related issues connected with Grama Panchayath Special emphasis will be made to train them on revised budget and accounts rules of Grama Panchayath. They in turn (after training) will be the Resource Persons to train various functionaries of Grama Panchayath

Cascade (10

days)

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J Joint training of GP

Chairpersons/ Vice chairpersons and Secretaries (Accounts)

To understand mutual responsibilities, problems and the need for conducive environment to discuss and sort out differences. Conducted in cascade mode by using available infrastructure facilities in the district and taluk levels and developing a cadre of district/ taluk Resource Persons.

Cascade

(5 days)

K GP Secretaries

workshop

A separate 6 days workshop will be organized to

Secretaries

• To understand the procedure in preparation of comprehensive village plan

• Preparation of GP Budget • Maintenance of important register and

records • Understand financial management systems

in PRIs • Preparation of monthly and annual accounts • Audit of accounts • Clearance of audit observations

Cascade (6

days)

L Panchayat

Engineering staff

A separate 5-day training program in face-to-face mode for the engineering staff on gram Panchayat budget and accounts. It will focus on the importance of elected members of gram panchayats being involved in actual measurement of work and its certification before the measurement is processed for payment in the form of bills. The training will familiarize participants with the salient features of the Karnataka Financial Code, the Manual of Contingent Expenditure, Karnataka

Cascade

(5 days)

M Collection staff

(Gram Panchayats

appoint Collection

Staff, like Bill

Collectors, Tax

Inspectors, Office

Assistants for

collection of

revenues).

To understand the sources of each revenue, the provision of rules and the procedure of levy and collection. It will familiarize them with the records/ registers that require to be maintained – for example, receipt books, day books, demand, collection and balance registers, remittance registers, assessment registers, mutation registers, etc. It will also provide opportunity for them to discuss the problems involved in maintenance of records and register.

Cascade (3

days)

N Watermen / Bore well

mechanics

One-day orientation that will cover (i) specification-wise maintenance of stock inventory with details of receipts and issues and closing balance of stock, (ii) importance of issuing or receiving stock only on approved indents.

Cascade

(1 day)

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O

Audit staff To provide an understanding of the Karnataka Financial Code (Receipt Management, Expenditure Management, Budget Provision, Sanctions) and the Manual of Contingent Expenditure. It will cover the Karnataka Public Works Account and Departmental Code to explain rules relating to custody, maintenance and use o measurement books, nominal muster roles, work bills, work registers, contractors ledgers, use of machines – hire charges, etc. In addition it will cover the Karnataka Transparency in Public Procurement Act and the Karnataka Local Fund Authorities Fiscal Responsibility Act, Right to Information Act.

Cascade

(6 days)

P Training of Computerization of GP Accounts

Training of Trainers 160 Resource Persons to be identified from 27 districts. They will be given training on computerization of GP Accounts pertaining to

• Receipt management • Expenditure management • Preparation of computerized and classified

monthly and annual accounts • Management of various datas at GP level

upwards flow of data etc. On training, they will act as trainers to train GP functionaries

Cascade (10

days)

Training of GP

Secretaries

They get trained on computerized on GP Accounts

pertaining to

• Receipt management • Expenditure management • Preparation of computerized and classified

monthly and annual accounts • Management of various data at GP level –

upward flow of data etc.

Cascade (6

days)

Training of office

staff

They get trained on the following subjects and in turn they should help GP Secretaries to ensure

• Receipt management • Expenditure management • Preparation of computerized and classified

monthly and annual accounts • Management of various datas at GP level –

upward flows of data etc.

Cascade (6

days)

Q Environmental framework for panchyats

Training / capacity for implementation of environmental guidelines through Mahatma Gandhi Institute for Rural Energy and Development, Jakkur, Bangalore in collaboration with ANSSIRD.

Periodic and batch wise.

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23. Annexure-5

Government of Karnataka No.RDP 127 DTR 2004. Karnataka Government Secretariat, M.S.Building, Bangalore,Dated 26.4.2005. Circular

Subject:- Computarisation of Grama Panchayats-Guidelines – reg.

Preamble:

The task force for Decentralization has suggested that for effective implementation of Administrative Decentralization the use of computers is mandatory. The “ Historic Belur Declaration “ on 23rd January 2004 for giving an impetus to E-Governance also envisages that the Grama Panchayats should be computerized.

With the Computerization of Grama Panchayats, Property Tax Software, General Information, Multipurpose Census, & other data-base, like Natural Resources data base can be made available to the GPs. Further, other IT enabled services of other Departments like Bhoomi (Land-Records), Food & Civil Supplies ration card, Kaveri (Land Registation) etc can be made available at the Grama Panchayat level.

First Initiation Stage:

Computers will be provided to 700 Grama Panchayats coming under “Jal Nirmal”, 300 Grama Panchayats coming under “Jalasamwardhana Yojana Scheme”, 300 Grama Panchayats coming under “ Sujala “.

103 Grama Panchayats coming under the Financially viable Bangalore Urban ZP can procure computers on their own. For the rest of the Grama Panchayats the Government will provide funds.

Second – ‘ Development ‘ Stage:

The Grama Panchayats can procure computers out of their own resources, depending on the computer activity and extent of works involved.

Procurement Guidelines:

Minimum Configuration: The minimum configuration is advised for purchase of computers. The

Minimum Configuration in usage as approved by the Technical Advisory may be

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seen in the Annexure to this circular. This configuration is revises from time to time. Therefore the Minimum Configuration can be ascertained from the e-governance Department. The Computer System should consisting at least a computer, one printer & one UPS (preferably Solar Powered) Additional accessories according to the needs may be installed using their sources of the concerned Grama Panchayats.

Vendors:

(i) The list of Vendors registered and approved by the Department of Information

technology is available in the website of e-governance department http://www.karnataka.gov.in. This list is revised from time to time and the same may be ascertained.

(ii) The details of Rate contract Vendors approved by the Director General of Supplies & Disposals are available on their website http://www.dgsnd.gov.in. The list is revised from time to time. Hence the same is checked up.

(iii) Procurement of system conforming to Minimum Configuration specified by the DGS and D or E-governance Department may also be done under the Karnataka Transparency in Public procurement Act 1999 from Local vendors without exceeding the cost price fixed.

Purchaser: - Purchase of computers be approved by a resolution of the Grama Panchayat. Supervision: -

The concerned CEO of Zilla Panchayat should certify the Proposal for the purchase of computer for the Grama Panchayat or an officer designated by him for the purpose. Approval should be accorded within 30 days of the proposal, failing which, the GPs should re-examine the proposal & certify that the proposal confirm to the guidelines. User Preferences:-

The GPs may use the computers for collection of information and Data in GPs relating to property software, Accounts, Grama Panchayat and Gramasbha Meeting proceedings, Letters of GPs, Data base of different subjects, sending letter by E-mails. The Nudi Software may be downloaded from the website of the RD & PR Department http://www.kar.nic.in/rdpr. Details of Some Web pages is as under: 1) E-governance Website - http://www.karnataka.gov.in 2) DGS & D Website - http://www.dgsnd.gov.in 3) RDPR Department Website - http://www.kar.nic.in/rdpr Sd/- (N.Sivasailam) Secretary to Government (P.R)

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Rural Development and Panchayat Raj Department.

Annexure to the circular dated 26.4.2005 (Minimum configuration)

Suggested minimum systems specifications: 1. Computer Hardware: Desk TOP computer System Specifications: Intel Pentium-IV CPU @ 2.8 Ghz.or greater With Intel 865 or 915 GV chipset. (With 533 MHZ.FSB & audio card on-board) 1 X 256 MB DDR RAM upgradeable up to 1.5 GB (2 free memory slots for expansion) 512 KB L2 Cache (Min 2 PCI slots free for expansion) 1 x 1.44 MB FDD 1 x 80.0 GB PCI-IDE hard disk (7,200 rpm) With ultra ATA 100 controller Card, & SMART II enabled 15 SVGA Colour Monitor (1024 x 768), MPR II certified I Parellel, 2 serial prots, 2 USB port, PS/2 Mouse port, Key Board-Mechanical (107 Keys) 52 x CDRW (Combo) or greater to support multimedia With external speakers & microphone 10/100 MBPS 32 bit Ethernet card build on motherboard Optical Mouse with pad. Windows XP (Prof.) preloaded with license & CD media/recovery CD 2) Printer: Dot Matrix Black Ink only one color with minimum requirement. Dot Matrix Printer: 24Pins, 136 col., Bidirectional 300-390 PPH Wipro LQ 1050 + DX gold, or equivalent Warranty: 3 Yrs. Comprehensive on warranty. 3) UPS: Half an hour back up UPS (Preference to solar UPS). Line Interactive for single desktops systems 500 VA with 30 Minutes Backup time 1 x 14 AH SMF battery. With file saving auto shutdown s/w with USB connectivity and connecting cables Warranty: 3 Yrs comprehensive on site warranty.

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Government of Karnataka

No.RDP 127 DTR 2004. Karnataka Government Secretariat, M.S.Building, Bangalore, Dated: 16.9.2005. Circular

Subject: - Revision of minimum configuration to be adopted while purchasing the Computer systems for Panchayats Computerization

Reference No.RDP127 DTR 2004 Dated 26-04-05 Details of minimum configuration are given in the circular under reference with regard to computer systems under panchayats computerization. This minimum configuration has been revised in the meeting of Technical Advisory Panel of RD & PR Department held on 05-09-2005, and given in annexure. Henceforth Gram Panchayats have to ensure these minimum configurations while purchasing the computers. Other guidelines remain same as per the previous circular. Minimum configuration can also be obtained in the departmental website. (Gurumurthy S Hegde) Deputy Secretary to Govt (Admin)

RD & PR Department

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(Minimum Configuration) Revised Circular No.RDP 45 DTR 2005 Dated 16.9.2005.

CPU Pentium 4 Processor @ 3.0 GHz with HT or higher Secondary IMB L2 cache 800 MHz.,FsB Mother Board Inte/OEM 915 Mother Board

Chipset Intel Chipset RAM 512 MB DDR RAM 400 MGz upgradeable up to 4 GB on DIMM Expansion slots 2 PCI. IPCI Express xl, 1 PCI Express x16 slots HDD 80 GBI IDE Serial ATA, 7200 rpm, integrated 4 sata ports,

integrated single FDD 1.44 MB 3.5” CD ROM Drive

DVD/RW COMBO Drive to support multimedia with external speakers & Inbuilt modem.

Ports 1 parallel, 1 Serial, PS/2 Keyboard and Mouse-02, 6 USB (two front and four rear USB ports)

Graphics Integrated Intel Extreme Graphics 2 through DVMT Shelves 2 internal 3.5 inch for hard disk drive, 2 front accessible 5.25 inch

for CDROM or DVD, 01 front accessible 3.5 inch for FDD. Monitor 15” MPR II Certified SVGA Monitor NIC Card Integrated 10/100/100 Keyboard 107 Mechanical keyboard (OEM make) with 50 Million Strokes Mouse Optical Mouse with pad Web Camera Inbuilt web camera Cabinet Micro ATX Mini tower Anti Virus Preloaded Security Built in BIOS password protection, user and supervisor password,

Flash ROM write protection. Diskette drive boot control, Data Recovery Software

Operating System

Windows XP professional operating system pre loaded with License and recovery CD

Power Supply Min 160 W SMPS Sound Integrated high definition audio

Certifications ISO 9001:2000 certification for manufacturing and design Win XP or Win 2k OS certified and letter from Microsoft to this effect DMI 2.0 certification Linux certificate (Linux Ready) MPR II Certified monitor ACPI Compliance Energy Star Compliance Intel OEM Manufacturer 1 year on site Comprehensive Warranty certificate from manufacturer

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7. Printer

g) Dot matrix printer a. 9pin 80 column 300 cps at 12 cpi with one IEEE 1284 parallel port

warranty 1 year comprehensive on site warranty b. 24 pins 136 columns, 360 cps at 12 cpi having one IEEE: 1284 parallel

port warranty 1 year comprehensive on site warranty h) Laser Printer i) Monochrome Resolution 600 X 600 dpi, A4 paper size, 8 MB

RAM, 16PPM, 1 USB port compatible with Linux and Windows warranty 1 year comprehensive on site warranty

ii) Monochrome Resolution 1200 X 1200 dpi, A4 paper size, 16 MB RAM duplexing and with network card 10/100 compatible with Linux and Windows warranty, 1 year comprehensive on site warranty

i) Scanner HP Scan jet 3670 Cor equivalent, 1200 X 1200 dpi, 48 bit color, USB

connectivity Warranty, 1 year comprehensive on site warranty

8. UPS-Linc interactive for single desktops system

600 VA with 30 Mts. Backup time 12VI X14AH or 2X7AH SMF Battery warranty, 1 year comprehensive on site warranty both for UPS and battery

9. Solar based electricity and UPS should be introduced after consultation with renewable energy produces.

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24. Annexure-6

Decentralization Analysis Cell (DAC)

Responsibility of the cell

The decentralization analysis cell (DAC) would be responsible for analysis, evaluation,

monitoring, and development of the intergovernmental fiscal system. The unit will be

essential in providing the basic analysis and intellectual leadership that will allow

government to make its decisions about the system. At the time the State Finance

Commission is constituted, the DAC may provide technical and data support to State

Finance Commissions Secretariats. This would improve the quality of inputs available to

the work of the State Finance Commission, and thereby make its results far more

satisfactory and make them more likely to be accepted.

While DAC would initially focus only on rural bodies it would be expected that at a later

state it would also oversee the urban local governments. This is necessary because the

vertical share of revenues for urban and rural local governments is drawn from the same

pool of state funds, there are economies of scale in training and in EDP development,

there will be uniform accounting rules, a fiscal information system will need to be

maintained for all local governments, etc. Moreover, this would allow the state to think

about all of its local governments in formulating expenditure assignments, taxing

policies, and intergovernmental transfers. Urban and rural governments might end up

receiving separate treatment, but this should be done in the context of the goals of the

overall system of government finance. Finally, there is need to have a clear transition

that leads to graduation of a local government from rural to urban status.

The DAC would have three tasks: monitoring the fiscal and service delivery performance

of rural local governments; evaluating the performance of the intergovernmental fiscal

system; and reporting to government and the public. Intergovernmental fiscal system

means the finances of local governments (e.g., taxes, charges, expenditures, budgets) and

the finances of the state government that effect the fiscal position of local governments

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(e.g., grants, shared taxes, payment of entitlements, regulatory policies, etc.). Duties of

DAC would be as follows:

DAC will be responsible for leading the design of the system, overseeing the

submission and correction of data each year, handling questions and providing

technical assistance, and organizing the data in such away that it can be used by

government agencies and researchers. DAC would carry out annual tracking of

the fiscal performance and fiscal health of each local government. This will

include budgetary outcomes in terms of spending and revenues raised, budgetary

balances and shortfalls, tax effort, and the match between budget projections and

actual outcomes. This tracking would rely heavily on data produced by the fiscal

information system. This is discussed in detail in the following points:

Formula Evaluation. Whatever formula is put in place to distribute funds among eligible

local governments, there is need to continuously assess the efficacy of this formula. For

example, the questions that might be asked at every evaluation include whether the

system is equalizing, whether there are unacceptable “outliers”, whether it is encouraging

or discouraging local tax effort, etc. The responsibility of the DAC will be to analyze and

to propose adjustments to the formula to better achieve government objectives. This

could be done on a regular basis, and could be a much larger effort when done every fifth

year as part of the work of the State Finance Commission.

• Monitoring of Compliance. The State will lay down certain conditions as part of

its fiscal restructurings, and it will be the job of the DAC to track the compliance

with these conditions. For example, the state may require that property tax rolls

be updated, and the DAC will examine data to determine the extent to which this

has been done, etc.

• Revenue Mobilization Analysis. An important question that the DAC can help

answer is whether local governments in Karnataka are increasing their rate of

revenue mobilization. It can also provide analytic work that can point to why

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some local governments are doing better than others. As decentralization

proceeds, local government revenue mobilization will almost certainly move

higher on the agenda of policy goals of the state, and detailed information on local

government tax effort will be needed. There is much interest in developing

revenue sources for rural local governments. The DAC could produce an index of

revenue effort and could track the change in tax effort over time. It could also

evaluate alternative programs that were designed to improve revenue effort.

• Best Practice. Many local governments will be innovative under a

decentralization system. The DAC could identify instances of best practice,

evaluate these, and disseminate them to the sector.

• Expenditure Assignment. DAC could carry out continuing analysis of the

efficacy of assigning certain functions to the gram panchayat level, relying for

information on the monitoring of service delivery outcomes. This might include

estimating the cost implications of reassignments of expenditures.

A second major function of the DAC is evaluation of the intergovernmental system. To

what extent is the system achieving its objectives? What would be the impact of various

reforms that have been proposed? It is a reasonable expectation that Gram panchayats

will be changing in the future and the intergovernmental fiscal system will likely have to

keep up with change. Hard analysis of the impacts of alternative proposed changes

would be necessary to inform the decisions that the government must make. The

following are some examples of evaluation work that the government will likely ask of

DAC.

• Expenditure Disparities Tracking. A concern in Karnataka is the disparity in

public expenditure levels among the 5,700 rural local governments in the state.

The DAC could track this disparity on an annual basis and could model the

determinants of these differences. An annual evaluation of fiscal disparities within

the state would be an important responsibility of the DAC. For all gram

panchayats, what is the variation in key indicators of fiscal activity among local

governments? This would include per capita expenditures, per capita revenues

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raised, revenue effort, and the like. The goal will be to track the extent that the

equalization grants of the state government and the central government reduce the

fiscal disparities.

• Annual “Intergovernmental Review”. Every year, the DAC could take the lead

in preparing an intergovernmental review. It could be circulated widely, and

could be the subject of an annual seminar. The basic purpose of this review

would be to report on the state of sub national government finances in Karnataka,

in a way that this information could be widely disseminated and understood. This

would assist the state in building a better understanding of fiscal decentralization,

and getting more participation from numerous public and private sector

organizations in further developing the decentralized fiscal system. The first such

review is scheduled for calendar year 2007.

• Reporting. An important function of the DAC is to report to the government and

to the public. By increasing the flow of accurate and timely information, the

DAC could play an important role in improving pubic policy towards

decentralization and ultimately toward improving service delivery. Reports that

DAC might issue regularly could include: (i) An annual review of the

intergovernmental system in the state. This could be a volume that both described

outcomes for the entire state, and offered in-depth analysis of particular issues. It

would be a compendium of data and explanation. This would increase the

transparency of the system, and might stimulate reform discussion both inside and

outside government. (ii) A website. This could be used to present data for those

who would examine the system (government agencies, lending agencies,

researchers, etc.). It could also be the place where DAC research, best practice

analyses, and assorted fiscal notes would be posted. All gram panchayats could

not access (because of skill deficiency), but many of them could. (iii) A research

reports series. This would be a periodic issue, depending on what research had

been completed. The DAC would develop a list of “clients” to whom these reports

might be made available.

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The DAC may provide technical and data support to State Finance Commissions

Secretariats, when the latter is functioning. Among the other possibilities are that the

DAC could convene periodic seminars to inform government and others about a

particular issue on which they have carried out research. It is important, however, that

the duties of the DAC be kept within the bounds of policy research and that this unit not

be folded into some other department

Staffing of DAC. A large overhead cost in the form of staff that does not have well

defined functions needs to be avoided. However, the duties of the DAC could be

considerable, especially if the urban as well as the rural sector is included in its mandate.

Staffing would be as follows:

• Director: A senior person, capable of providing intellectual leadership to the

team. Must know the subject matter, and must be very interested in it. He/she

must be capable of understanding what every technical staff member is doing,

be able to define the work program for the staff, and be research oriented.

The Director also must be capable of presenting the work of the DAC in

forum with higher-level government officers and political leaders. The

success of the DAC will, to a large extent, be determined by the capability of

the Director. The director will report jointly to the Departments of Finance

and RDPR.

• Staff members (4), who will lead the specific projects as outlined above.

These would be people trained at the master’s level, preferably in public

finance or with a graduate degree in a related field and commensurate

experience in public finance analysis. These should all be research-oriented

people with a background in research.

• Senior staff (1) who would be responsible for monitoring and upgrading the

fiscal information system, and assuring that appropriate data from the system

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would be distributed to the FAU and to those in other institutions producing

research on this subject? One IT staff will also be needed here.

• Junior staff assistants (5) who would be responsible for backing up the

seniors? These would be younger people, but would be college graduates

with appropriate backgrounds and would be candidates to grow into senior

positions. These junior assistants would also be candidates for more training.

Their duties in the DAC would be to carry out some of the basic research,

under the direction of the senior to whom they are assigned.

The Monitoring System for Panchayats would cover both fiscal performance and service

delivery aspects. The system will change as the needs and performance of local

governments change, and as the goals of the state for its intergovernmental system

change. But these changes need to be made in a thoughtful and measured way, and

therefore need to be led by careful research, such as will come out of a monitoring and

evaluation system. Underlying the monitoring system will be a fiscal information system.

These are the basic data that will be used to quantitatively assess and update the

performance of the system. The performance monitoring can only be as good as this

database will allow. The following are likely to be the fiscal behaviors that are

monitored:

• On what functions do local governments spend their funds? This will

lead to an annual compilation of expenditure patterns of local

governments. The basic question in which government is interested is

whether local governments are actually spending to promote the

development of basic services.

• Assess changes in basic service levels. This could be done either by

setting a minimum per capita level of spending for each function and

comparing this to actual outcomes in each GP, or by attempting to

establish minimum (measurable) service levels in physical terms.

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• What is the progress of local revenue mobilization? Have local

governments increased revenues, expanded the base for each tax, and

increased collection rates? This should be reported each period, based on

data from the fiscal information system, and probably supported by data

gathered from questionnaires for each GP.

• Are certain local governments identifiable as being under particular

fiscal stress? This would allow preparing a remedial program for these

local governments, and at a minimum would identify them as candidates

for special assistance of one kind or another.

• Have fiscal disparities been reduced, and to what is this reduction

(increase) attributable? The DAC will examine spending patterns for

each GP, and will study the pattern of fiscal disparities and their pattern of

increase or decrease, with an eye toward whether the intergovernmental

transfer system needs adjustment in terms of the formula distribution.

• Are intergovernmental transfers being distributed according to the

formula, and are full entitlements being distributed? In a sense this is

the DAC monitoring the GOK in terms of its following through on

distributing grants by the agreed formula.

• If transfers are being distributed with some conditions, to what extent

are the GPs meeting those conditions? This would be done in

conjunction with the line agencies imposing the conditions.

The service delivery monitoring system would complement the fiscal performance

monitoring system. The underlying issue related to whether decentralization is

“working” is whether citizens are getting better public services. The term “better” is a

hard one to define. One could be conventional and ask whether there are improvements

in the levels of services offered, quantity or quality, and look for physical measures. The

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DAC should do an inventory of services provided at the beginning of this period, and

look for ways to update these physical measures as a way to identify the progress of

service delivery under fiscal decentralization. For this it would make use of the Service

Delivery Surveys administered by the District and which would be aggregated to the state

level. The measures might include percent of housing units with access to various kinds

of water supply, number of streetlights per capita, etc. But “better services” can also

mean that people are getting more of what they want. And, this is the essence of fiscal

decentralization; local populations are empowered to demand those services that they

want.

Finding a systematic way of collecting the data for monitoring. The department of the

Panchayati Raj in the state of Karnataka introduced a new survey to be administered by

the Gram panchayati members in January 2004. This survey instrument is used to collect

data on income, land holding, type of house, sanitation, assets, education, means of

livelihood and debt levels. The purpose of the survey is mainly to create accurate lists of

the citizens who are BPL.

This instrument could be used as a platform (means) to improve each Gram panchayats

own data collection and monitoring as well as providing policy makers with accurate

information. Over time, they could build a database (panel data) that would help them

understand what their constituency looks like on basic indicators. They could also

compare themselves against other neighboring gram panchayats on indicators of

importance. In addition, more specific questions on standard economic indicators

(income and consumption) as well as other human development indicators should be

added to the existing questionnaire. This would serve as a powerful statistical tool to

analyze causal relations.

It is important to note that the difficulty in the first round of this survey was that the

interviewers (mostly gram panchayat members) were misinformed about the purpose of

the survey. The confusion that this survey would be used to identify those eligible for

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benefits provided to the BPL must be rectified. Awareness about the purpose of this

survey needs to be increased.

• Conducting quality checks on the data. The data that is collected by the

Gram panchayati members should be verified on a regular basis. Since the sample

size would be significantly large, random checks on the surveys should be carried

out by DAC. A penalty should be instituted if inaccurate data is found. This

would set a precedent for the other Gram panchayats. The form of the penalty

could be monetary or something like publishing this information in the local

paper.

• Setting up a baseline for evaluation. Given that the objective of the

evaluation is to find out whether citizens who have access to block grants make

better choices, a vignettes based approach can also be used along with citizen

perceptions surveys, i.e., scorecards.

The baseline data will be collected by an independent group at the beginning of the

project and at the end of the project thus creating panel data. A difference method can

then be used to assess the impact.

This component would also support policy studies related to decentralization. These

studies would be commissioned by DAC and would cover issues such as (i) strategies for

enhancing local revenue generation at the Panchayat level; (ii) a review and detailed

proposals on expenditure assignments, in particular in separating better the functions of

the three tiers of Panchayats; and (iii) issue in service delivery in specific sectors.

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25. Annexure-7 Suggested Terms of Reference for the Audit of Gram Panchayats by the Karnataka State Accounts Department under the Karnataka Panchayat Strengthening Project (Gram Swaraj) Background This document presents suggested Terms of Reference for the Audit of Gram Panchayats (GPs) by the Karnataka State Accounts Department (KSAD). These Terms of Reference have been prepared following discussions with the AG (Karnataka) regarding the possibility of CAG Technical Guidance to the Karnataka State Accounts Department – the statutory auditors of the GPs. In that context, this ToR is a suggested document that could be considered while providing guidance to KSAD regarding the audit of the Block Grants disbursed to GPs under the World Bank financed project Karnataka Panchayat Strengthening Project. It is important to mention here that GPs in Karnataka currently follow the cash basis of accounting and the audit will examine the GP financial statements prepared in accordance with the accounting rules applicable to the GPs at the time of audit3. Objective The objective of the consolidated audit of the Financial Statements of the GPs is to enable the Auditors to express a professional opinion on whether the annual financial statements present fairly the financial transactions and balances associated with the usage of the Block Grants received under the captioned project for ‘eligible activities’ as defined in the Karnataka State Panchayat Raj Act and Rules and in accordance with the fiduciary framework set out in the Operations Manual for the project. The audit is meant to be an instrument for assurance on financial statements and while proprietary aspects (like uneconomic and unproductive expenditure) may be covered for the CAG’s own purposes that is not the focus of the audit of the financial statements of the GPs. Scope The audit will be carried out in accordance with the appropriate regulations and standards of audit of Gram Panchayats as set out by the Comptroller and Auditor General of India. It will include such tests and controls, as the auditor considers necessary under the circumstances. In conducting the audit, special attention should be paid to the following:

• Whether all Block Grant funds have been used in accordance with the conditions of the relevant financing agreements like the Operations manual, the Development Credit Agreement, the Project Agreements, Project Appraisal

3 GPs are expected to switch to accrual basis in the future and after the switchover, the audit of the accounts of GPs’ prepared on accrual basis will be conducted.

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Document under Credit No. 4211 IN, and only for the purposes for which the financing was provided.

• Whether goods, equipment, works and services financed have been procured in

accordance with the relevant loan and project agreement & procurement procedures of the Bank;

• Whether all necessary supporting documents, records and accounts have been

kept in respect of all Block Grants received and reported via the Financial Monitoring Reports (FMRs) and the Annual Accounts of the GPs. Clear linkages should exist between the books of account and reports presented to the Bank. The audit should confirm that the Block Grants have been used for one of the 29 ‘eligible activities as defined by the Karnataka State Panchayati Raj Act and the accompanying rules and that the approval, usage, accounting and social accountability mechanisms on the Block Grants are as per the fiduciary framework agreed with the Bank and set out in the OM .

• Whether the accounts of the Block Grant receiving GPs have been prepared in

accordance with the relevant GoK accounting rules for GPs and give a fair view of the financial situation of the GPs at the year-end and of resource and expenditure for the year ended on the date.

• The audit will also ascertain whether appropriate procedures for the control and

maintenance of assets purchased/created through the BGs. Financial Statements of GPs: The financial statements of GPs would include the Balance Sheet, Profit and Loss Account and Statement of Cash Flows of the project. Audit Opinion:- The auditor is expected to present an opinion on the financial statements of the Block Grant receiving GPs. Besides the primary opinion on the financial statements, the audit report should include a separate paragraph commenting on the usage of the Block Grants disbursed through the Bank credit. The auditors should submit a consolidated audit report of all the GPs that have been audited to the Rural Development and Panchayati Raj Department within 4 months of the end of the accounting period to which the audit refers so that these may be transmitted to the Bank within 6 months. Auditor's Comments: - In addition to the other areas, the auditor will also comment on:

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Observation on the accounting records, systems and controls that were examined during the course of the audit; Identify specific deficiencies and areas of weakness in systems and controls and make recommendation for their improvement. Report on the degree of the compliance of the financial covenants on the financial agreements Communicate matters that have come to attention during the audit which might have a significant impact on the implementation of the project; and bring to the borrower's attention any other matter that the auditors consider pertinent. General: - The auditor should be given access to all legal documents, correspondence, and any other information associated with the project and deemed necessary by the auditor. It is desirable that the auditor become familiar with a copy of the PAD, the Operational Manual, the fiduciary framework governing the usage, approval, accounting and reporting of Block Grants and the relevant GoK rules regarding GP accounting.

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23. Annexure-8

Terms of Reference for the audit of Annual Financial Statements of the Karnataka Panchayat Strengthening Project (KPSP)

Objective The objective of the audit of the Annual Financial Statements (Financial Monitoring Reports: FMRs) is to enable the auditor to express a professional opinion on the AFS of the Karnataka Panchayat Strengthening Project (KPSP) implemented through the Department of Rural Development and Panchayat Raj (GoK), at the end of each fiscal year and of the funds received and expenditures for the accounting period ended March 31, 2006 as reported by the FMRs.

The KPSD project accounts (FMRs) will be based on expenditure reporting received from all the Project Implementing Agencies (PIAs) that receive funds under the projects ie. the Taluk Panchayats (TPs), Gram Panchayats (GPs) and ANSSIRD for the investment component and transfers for the programmatic component. These FMRs will reflect all the financial transactions for the project, as maintained by the Head office based on expenditure reports and supporting documentation supplied by the PIAs. The audit of the project FMRs will cover transactions at the individual PIAs.

Scope

The audit of the project financial statements shall be carried out by ------------------- (name of firm) and the audit report will be submitted within 6 months of the close of fiscal year. The audit shall be carried out at the Facilitation Cell: FC (set up in the RDPR) and at the individual PIAs. The scope of audit shall extend to all the expenditures and related transactions in respect of the project, both at the FC and at the PIAs. It is important to mention here that while the FC at the RDPR will act as the facilitation agency for audit, it will be the responsibility of the auditor to visit the PIAs to conduct the audit of individual transactions and to compile the consolidated audit report covering all expenditures at all PIAs and at the FC and to certify the project’s FMRs which represent this consolidation of expenditures. The audit will be carried out in accordance with relevant national standards on auditing, and will include such tests and controls, as the auditor considers necessary under the circumstances. The auditors shall take guidance from the IPSAS Guidance Notes on Accounting for Cash Based Statements and from the statutes and standards as developed and modified from time to time by the State Accounts Department.

In conducting the audit, special attention should be paid to the following factors:

• All funds released by GOK and World Bank have been used in accordance with the conditions as laid down in the legal agreement, and only for the purposes for which the funds were provided.

• All funds have been used in accordance with the relevant financing agreements, with due attention to economy and efficiency, and only for the purposes for which they were provided.

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• All funds disbursed as Block Grants to GPs have been done in accordance with the conditions laid out in the fiduciary framework established for the programmatic component and after ensuring that the corresponding GoK transfers have taken place.

• All expenditures, including procurement of goods and services, have the necessary supporting documentation and have been incurred in accordance with the Government rules and relevant financing agreement.

• All the receipt and issues of equipments and goods have been properly accounted for in the stock registers and the balances worked out correctly.

• All moneys expended by the the PIAs as well FC are eligible for reimbursement under the legal agreements and such tests and controls as are considered necessary by the auditor to verify this are are applied. This would include assurance on the fact hat appropriate receipts, vouchers and necessary supporting documentation is maintained.The consolidated Financial Monitoring Reports have been prepared in accordance with the cash basis of accounting and State Finance and Accounts Rules and give a true and fair view of the receipts, payments and the financial position of the Project for the financial year ending March 31, 2006.

Financial Monitoring Reports The FMRs should include:

• A Statement of Sources and Uses of funds showing the funds received from GoK and IDA separately;

• A Statement of Uses of Funds by Component and break up by sub Component for the current fiscal year and accumulated to date;

• A Statement showing the details of Assets created under the Investment components including the PIA where the assets are located and the Book value of the assets at the end of each FY

• A Statement of Cash Flow showing the opening and closing bank balances The auditor is required review the individual audit reports of the PIAs at various levels to enhance the level of assurance on the financial statements in addition to undertaking an audit of all expenditures at the PIAs. Audit Opinion The Audit report should contain an assertion on the fairness of the financial statements (FMRs) and the extent to which the Bank can rely on them as a basis for loan disbursement. Annexed to the FMRs should be a schedule listing individual claim/withdrawal application submitted by the state to Central Government by specific reference number and amount. The amount of expenditure claimed in the FMR should be reconciled with the amount appearing under the summary of expenditures of the individual financial statements received from various implementing agencies. The amount of expenditure claimed in the consolidated FMR prepared by the State (submitted for the eligible expenditure incurred during the financial year under audit) should be reconciled with the amount appearing under the summary of expenditure of the consolidated receipt and payment statement. The consolidated FMRs, including the audit report should be received by the Bank not later than six months after the end of the accounting period to which the audit refers.

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Management Letter In addition to the audit reports, the auditor should prepare a consolidated “management letter” in which the auditor should summarize the key / material observations, internal control issues reported in the management letter accompanying the TP/GP/ANSSIRD audit report: a) Comments and observations on the accounting records, systems and controls that were

examined during the course of the audit; b) Specific deficiencies and areas of weakness in systems and controls and make

recommendations for their improvement; c) Report on the degree of compliance with the financial/ internal control procedures as

documented in the financial manual of the project. d) Communicate matters that have come to attention during the audit which might have a

significant impact on the implementation of the project; and e) Bring to attention any other matter that the auditor considers pertinent. The Observations in the Management Letter must be accompanied by a suggested Recommendation from the auditors and Management Comments on the Observations/ Recommendations from the Management. General The auditor should be given access to all legal documents, correspondence, financial manual and notices from the RDPR department and other implementing agencies and any other information associated with the project and deemed necessary by the auditor.

AUDIT REPORT FORMAT Unqualified Opinion on the Annual Financial Statements including SOE of the Karnataka

Panchayat Strengthening Project (KPSP) (Which are the Financial Monitoring Reports for the Project)

To: (Addressee) Introduction

We have audited the accompanying expenditure statements/financial statements of the KPSP Project implemented through the Rural Development and Panchayati Raj (RDPR) Department financed under World Bank Credit No. 4211 IN as of March 31, 20X [indicate any other additional years necessary] for the year(s) then ended. It is the responsibility of the PMU and the RDPR Department to prepare the FMR; it is our responsibility to express an opinion on these financial statements based on our audit.

Scope

We conducted our audit in accordance with relevant national Standards on Auditing [or relevant national standards or practices, and/or World Bank guidelines], the relevant Guidance on Audit of Cash based Financial Statements issued by IPSAS and the relevant statutes of the State Government of Karnataka and standards developed and latest modifications by the State Accounts Department. Those Standards and/or World Bank guidelines require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the

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amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. Opinion

In our opinion, the financial statements give a true and fair view of the Sources and Application of Funds and the financial position of the KPSP for the year ended March 31, ------ in accordance with [indicate International Accounting Standards or relevant national standards. ]

In addition, the auditors would comment on (a) whether adequate supporting

documentation has been maintained to support claims to the World Bank for reimbursements of expenditures incurred; and (b) which expenditures are eligible for financing under the Loan/Credit Agreement [Cr.4211 IN].

[Name and Address of Audit Firm]

[Date – Completion Date of Audit] Notes: 1. The auditor should have reference to the statements defined as Project Financial Monitoring Reports in the Terms of Reference above. 2. In case a qualified opinion or disclaimer is given by the auditor, the audit report should state in a clear and informative manner all the reasons for such an opinion.

3. Audit report to be accompanied by

a) Management Letter b) Listing of SOE withdrawal applications sent to the State Society (in case of audit of

district Society). c) Listing on ineligible claims, if any. d) Reconciliation of FMRs with the actual expenditure as reported in the audited

financial statements.

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27. Annexure-9 Terms of Reference for the Internal Audits of GPs under Karnataka Panchayat Strengthening Project (KPSP) Introduction The Karnataka Panchayat Strengthening Project (KPSP) will be an IDA credit of USD 120 million disbursed over 5.5 years. Support under the project will follow a dual approach of programmatic support (for Component A: Block Grants to Gram Panchayats) and traditional investment lending (for all other components). In case of the programmatic component, all funds will be used by the third tier of Panchayati Raj Institutions (PRIs) at the village level. Taking cognizance of the relatively weak capacity at the GP level, special arrangements enshrined in a fiduciary framework have been put in place to ensure adequate assurance for project Block Grant funds and capacity building at GPs. The fiduciary framework is set out in detail below, but the spirit of the framework is to ensure that Gram Panchayats spend project finds on a predetermined list of activities that are agreed with the Bank, that all expenditures are subject to appropriate controls and regular audit scrutiny and that there are mechanisms in place for dealing with misappropriations and misapplications. It is in this context that an internal audit of the financial statements of the GPs receiving Block Grant funds is being instituted. Although the GP accounts will be audited by the Karnataka State Accounts Department (KSAD) officials in the routine course, as a measure of secondary assurance, the project would be appointing firms of Chartered Accountants who will carry out the review of the financial statements of few GPs selected on random basis. This ToR sets out the suggested terms of that engagement. It is to be ensured that all the GPs, which receive block grants, are covered at least once during the life of the project. Objectives and Scope of the Audit The objective of the audit is to provide an independent professional opinion to the various stakeholders (Government of India, Government of Karnataka, general public, World Bank, project management, etc) on the efficacy of the financial and operational control structure in place go govern the disbursement, use and accounting of the Block Grants. In particular, the internal auditors will have regard to the fiduciary framework governing the use of these Block Grants as set out in the Project legal Agreements. Specifically, the audit will provide assurance to all stakeholders that: In conducting the audit, special attention should be paid to the following:

• That all the Block Grants sanctioned by the RDPR department have been received and appropriately recorded in the books of accounts of the GP. In addition, the internal auditors will verify that the project funded Block Grants followed the

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SFC mandated grants of Rs. 500,000 from GoK as agreed in the Project Appraisal Document.

• That the requirements set out in the fiduciary framework, which sets out the controls on BGs and directives with respect to their usage, are appropriately applied. This would include ascertaining that there is a (i) Directive from RDPR to GPs saying the BG funds may only be spent on eligible activities, (ii) Approval procedures ensuring that the proposed uses of BGs are approved by the Gram Sabha and RDPR before release of BG funds were followed, (iii) Directives from RDPR ensuring roll out of the FM reform which will in turn ensure the appropriate accounting of BG funds in the books of the GP have been followed and (iii) Adequate assurance on end use of BG funds through audit and social accountability mechanisms. In addition to ensuring that social accountability and control mechanisms are in place, the internal auditors will be specifically required to comment on the end use of the Block Grants and that it is in accordance with the intended uses. Intended purposes for use of BG funds will constitute the improvement and expansion of services under any of the 29 items devolved to the GPs by GoK.

• That all necessary supporting documents and records have been maintained with respect to the Block Grant expenditure and that the expenditures are reflected in the accounts of the GPs in accordance with the accrual accounting rules in place.

• That there are no material differences from accepted accounting standards where relevant.

• That there are no cases of misappropriations or frauds detected and if there are that these are reported and appropriate action is taken.

• That procedural and social controls including those on the procurement of goods, works and services funded by the Block Grants at the GP level.

This audit will include such tests and controls, as the auditor considers necessary under the circumstances. The internal audit will be done prior to the statutory audit of the GPs and the report of the internal auditors will be shared with the Karnataka State Accounts Department (KSAD) so that they may place reliance on it in the conduct of the statutory audit of the GPs. The internal auditors report will be shared with the Bank as well. Assignment Period: The internal audit would be conducted six monthly for a selected sample of Block grant receiving GPs. The sample size will select in consultation with the RDPR department. Audit Opinion The Internal Auditors report shall specify the appropriateness of financial, procedural, social and operational controls. The auditors will specifically comment on the end use of BG funds, recording and book keeping and use of appropriate procurement procedures as set out in the Operational Manual. The auditors shall specifically comment on

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• Whether the fiduciary framework for the BG component has been followed • Whether the expenditures on the BGs have been appropriately recorded in the

books of the GPs • Whether exist any material misstatements, misappropriations or defalcations that

need to be brought to the attention of the RDPR. • Any deficiencies and areas of weakness in systems and controls and

recommendation for their improvement; • Compliance with covenants in the financing agreement and comments, if any, on

internal and external matters affecting such compliance; • Matters that have come to attention during the audit might have a significant

impact on the implementation of the project; and • Any other matters that the auditor considers pertinent

General The Private auditors who conduct this internal audit shall be given access to all documents, correspondence, and any other information relating to the project and deemed necessary by the RDPR PMU and the GP concerned. The auditors should become familiar with and stay updated on the project, and with the relevant policies and guidelines of the State Government relating to procurement which are relevant to the GPs, Project Appraisal Document (PAD) of the World Bank including the fiduciary framework. The auditors who conduct the internal audit or any of their associates (including associates of the firms partners) would not be eligible to carry out any financial review or audit or accounting services of the project to prevent conflict of interest.

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28. Annexure-10

Terms of Reference for Accounting Services at the Taluka Resource Centers to be set up under the Karnataka Panchayat Strengthening Project (KPSP) Introduction The Karnataka Panchayat Strengthening Project (KPSP) will be an IDA credit of USD 120 million disbursed over five years. Support under the project will follow a dual approach of programmatic support (for Component A: Block Grants to Gram Panchayats) and traditional investment lending (for all other components). In order to strengthen the fiduciary assurance for programmatic support, GoK has embarked on an FM reform program wherein the accounting systems and practices of the GPs will be modernized. The GPs currently maintain accounts on cash basis. The GP Secretary, who is an official of the State Government is responsible for maintenance of accounts and until now, the quality of accounts prepared was poor as there was limited accounting capacity (as most of the Gram Panchayat Secretaries were not trained accountants) and there was inadequate guidance on the norms and standards to be followed with regards to the preparation of cash based accounts. However, GoK means to approve a set of guidelines for conversion of the prevalent cash based accounts to accrual accounts. In order to facilitate this transition, a resource group of professional accountants at the Talukas being established. This resource group will be established under the Taluka Resource Centers (TRCs) and will be empanelled with the respective TRCs. This Terms of Reference has been prepared as a guide for the GPs who would like to contract the TRC Accountants to accomplish the switchover from cash to accrual accounting. Scope of Services The main focus of the services would be to provide professional hand holding support to the Gram Panchayats to help them to prepare the financial statements under the accrual system. Some of the specific steps that the consultants will have to take up are mentioned below, but it may be stressed that these are indicative steps meant as guidance, but the professional accountants will be expected to take up all other necessary actions that may be required to help the GPs switchover from cash to accrual accounting.

1. Help GPs to prepare an opening balance Sheet ensuring that all assets are appropriately inventorized and valued. Ensure that asset valuations are in accordance with the prevailing state government guidance / financial rules and or the guidance provided in the new Panchayat Budget and Accounts Rules-2006 issued by GoK.

2. Appropriately verify records to ensure that the GPs have compiled the lists of demands for all the taxes and levies in their purview.

3. Appropriately verify records to ensure that all advances received have been recorded and reflected in the opening Balance Sheet.

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4. Guide the GPs with regards to the books of accounts that they need to open to comprehensively record all the transactions. The Consultants shall refer to the new Panchayat Accounts Rules to verify the mandatory books and shall guide the GPs about any subsidiary books that may be necessary.

5. The Consultants shall study the opening Balance Sheets where these have been prepared for comprehensiveness, accuracy of balances and conformity with acceptable standards of accrual accounting as may be prescribed in the Karnataka Panchayat Accounts Rules.

6. The Consultants shall prepare a model Chart of Accounts where required and take the GP staff through the entries therein including guidance on debits and credits and which books of accounts the entries should be recorded in.

7. Provide guidance on capitalization of expenditures, norms for charging repairs and maintenance expenditures, provisioning for bad and doubtful debts, recording and safeguard of assets, maintenance of demand and advances registers and any other accounting topics that the GPs may request guidance on.

8. The Consultants shall provide guidance on maintenance and reconciliation of cash and Bankbooks.

9. The Consultants shall provide guidance on cut offs for recording year expenditures and revenues.

10. The Consultants shall also provide advice and support to the GPs on accrual budgeting and implementation of the new planning guidelines where necessary.

11. In cases where the accounting systems at the GPs are computerized, the Consultants shall provide support to the GP staff to make electronic data entries.

12. Where necessary the Consultants shall provide guidance in the local language. It shall also be the responsibility of the Consultants to flag off to RDPR cases where there are inadequacies or inconsistencies in the accounting manuals, or where more guidance in the local language is required.

Assignment Period. The assignment would initially be for a period of one financial years upto ----------------. However, it will be left upto the GPs concerned to renew or extend the Consultants’ services. Conflict of Interest In order to prevent the situation of a conflict of interest, the Consultants who are empanelled as Accountants in the TRCs may not audit the accounts of that GP for the next -------- years. [The decision on the number of years that the Accountants may audit the accounts for will be taken by the RDPR Department.] Key Personnel The Consultant should be a firm of Chartered Accountants with a local presence in the Taluka. At least one partner should be a member of the Institute of Chartered Accountants of India. The staff conducting the audit should have had exposure to

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government accounting and should be familiar with the issues that arise in the conversion of accounts from cash to accrual basis. The Consultant firm should also be familiar with the maintenance of books of accounts in a computerized environment. General The Consultant would be given access to all books and records of the GP as well as the new Karnataka Panchayat Budget and Accounts Rules-2006 issued.

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24. Annexure-11

Financial Monitoring Reports

FMR-Form 1

Statement of Sources and Uses of Funds For the period xx.yy. zzzz

Sources of Funds IDA/IBRD/GoK

For the Quarter

YTD Cumulative

Total

Uses of Funds Component A : BG Transfers Component B : Information Systems for Constituents Component C: Capacity Building of Panchayats Component D: Decentralization Analysis Cell

Total

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FMR-Form 2

Statement of Uses of Funds for the Programmatic Block Grants Component for the period ended xx.yy.zzzz

For the Quarter ended xx.yy.zzzz

For the Year to Date as on xx.yy.zzzz

Cumulative for the period from -------- (date of credit effectiveness) till xx.yy.zzzz

Planned Actual Planned Actual Planned Actual Variance GOK Transfers IDA BG Transfers

Total

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FMR-Form 3

Statement of Uses of Funds for the Investment Components for the period ended xx.yy.zzzz

For the Quarter ended xx.yy.zzzz

For the Year to Date as on xx.yy.zzzz

Cumulative for the period from -------- (date of credit effectiveness) till xx.yy.zzzz

Planned Actual Planned Actual Planned Actual Variance Component B : Information Systems to Constituents

Component C : Capacity Building of Panchayats C1. Creation of GP resource centers called Taluk Resource Centers (TRC) C2.Training programs for GPs through ANSSIRD, Mysore C3.Computerized financial management systems for GPs; C4.Environmental framework for GPs; C5.Establishing SATCOM Centres in North Karnataka and in Bangalore

Component D : Decentralization Analysis Cell

Total

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FMR-Form 4

Record of Assets created under the Investment Components B, C and D Project Investment Component

Type of Assets Created

Assets Recorded in the Books of the PIA --------- (Name of PIA)

Date of record of Assets in PIA books

Book Value of Assets as on xx.yy.zzzz

Component B : Information Systems to Constituents

Component C : C1. Creation of GP resource centers called Taluk Resource Centers (TRC) C2. Training programs for GPs through ANSSIRD, Mysore C3. Computerized financial Management systems for GPs; C4. Environmental framework for GPs; C5. Establishing SATCOM Centres in North Karnataka and in Bangalore

Component D: Decentralisation Analysis Cell

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25. Annexure-12

Financial Management and Disbursement Arrangements

Summary Project Description The Financial Management arrangements envisaged under the project can be said to be satisfactory to meet the requirements of the Bank’s OP/BP 10.02. The project will be an IDA credit of US$ 120 million, which will be disbursed over 5.5 years. Support under the project will follow a dual approach of programmatic support (for Component A: Block Grants to Gram panchayats comprising US$ 113 million) and traditional investment lending (for Component B, C and D comprising US$ 20 million). The four project components will be: Programmatic A. Block Grants to Gram panchayats (GPs) Investment B. Information Systems for Constituents

C. Capacity Building of the Panchayats

C1. Creation of GP resource centers called Taluk Resource Centers (TRC)

C2. Training programs for GPs through ANSSIRD, Mysore

C3. Computerized financial management systems for GPs;

C4. Environmental framework for GPs;

C5. Establishing SATCOM Centers in North Karnataka and in Bangalore

D. Capacity Building of the State [setting up of a Decentralization Analysis Cell (DAC)]

Implementation of all components will be coordinated through the FC in the RDPR. There will be a Financial Management Specialist (FMS) at the FC who will be responsible for maintaining project accounts and submitting these to audit. Disbursement on both components will be FMR based. These FMRs will comprise AFS for both components and will be maintained at the FC. The FMRs will record actual expenditures for the investment component and transfers for the programmatic component.

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In addition, the programmatic component will be governed by a fiduciary framework comprising (i) directives from RDPR instructing GPs to spend BG funds only on eligible activities which will be detailed in the OM, (ii) appropriate approval procedures to ensure that the proposed uses of BGs are approved by the Gram sabha and confirmed by RDPR before BG funds are released, (iii) directives from RDPR ensuring roll out of the FM reform program and to address the appropriate accounting of BG funds in the books of the GP and (iv) assurance on use of funds. The primary responsibility for monitoring that BGs are disbursed and accounted for in accordance with the fiduciary framework will be with RDPR while the requirements with regards to audit and assurance on end use will be also be monitored by IDA. Failure to meet assurance requirements will result in disallowances, while inadequacy on other aspects of the fiduciary framework will result in penal action from the RDPR wherein the defaulting GP will be ineligible for receipt of BG funds. Private auditors under an agreed ToR will do audit of the project’s AFS. In addition, IDA will monitor the KSAD audit of the GPs receiving BGs. An additional internal audit on a random basis will also be undertaken by private firms of Chartered Accountants, which will be selected from amongst a panel of firms created by RDPR in consultation with KSAD. Implementation Arrangements

FC within RDPR will be responsible for overall project implementation. The FC will monitor all project activities, submit claims of expenditures of all the PIAs, prepare FMRs and ensure that these are submitted to audit in a timely manner and ensure that project expenditures are subject to the appropriate controls. The detailed arrangements on the programmatic and investment components will differ and these are set out below:

Implementation arrangements on Component A - Programmatic BG Component

The FC will be responsible for implementing this component. FC will recommend transfer of BG funds to GPs, record these in AFS of the project and monitor corresponding GoK transfers. This component will be governed by a fiduciary framework comprising (i) Directive from RDPR to GPs saying the BG funds may only be spent on eligible activities4 which will be detailed in the OM,. (ii) Approval procedures ensuring that the proposed uses of BGs are approved by the Gram sabha. RDPR will confirm that proposed uses were properly approved by the Gram sabha before release of BG funds for new works; (iii) Directives from RDPR ensuring roll out of the FM reform which will in turn ensure the appropriate accounting of BG funds in the books of the GP and (iv) Assurance on end use of BG funds through audit and social accountability mechanisms. All the requirements on the fiduciary framework will be monitored by the FC at RDPR which will have overall oversight responsibility for this component. But, it is important to mention that the GPs themselves will be responsible for ensuring that funds received are used for the intended purposes. Intended purposes for use of BG funds will constitute the

4 Eligible activities will be improvement and expansion of services as defined by the 29 activities that are devolved by GOK

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improvement and expansion of services under any of the 29 items devolved to the GPs by GoK. Inadequate assurance on the end use of BG funds will result in disallowances. KSAD audit will certify that funds greater than or equal to BGs have been spent on agreed activities. It has been agreed that disallowances will be either adjusted, or deferred or as a last resort, refunded to the Bank. GoK will follow its procedures for recovery in such cases. Inadequacy on other aspects of the fiduciary framework (inability to adopt FM reforms, account appropriately for BG funds or failure to get the BGs approved by the Gram sabha) will result in rendering the defaulting GPs ineligible for receipt of BG funds. It is important to mention that GoK will in turn, use its own transfers of block grants over and above the statutory requirements to GPs as an incentive for ensuring that the following steps have taken place:

(i) Rolling out of FM reforms: New Planning Guidelines, New Accrual Accounting Systems by FY 2007

(ii) Conduct of (two annual) Gram sabhas (GS: village meetings) and approval of proposed use of BG funds in each of the GS’

(iii) Public disclosure of FM and Procurement information State government will maintain financial commitment to Gram panchayats as per formula agreed with IDA and will release funds periodically and in a timely and predictable way in accordance with this commitment. State government will ensure that its own SFC releases to the GPs are transferred each quarter as appropriate. (This is also mentioned in Section 9.6 of the Operational Manual).

For purposes of assurance, IDA will monitor GoK transfers of SFC funds to GPs and end use of BGs. Assurance on GoK transfers will come from audited FMRs which will show block grant transfers from GoK to the GPs5 while assurance on the end use of BGs (that they were used for the purposes intended) will be evident from the GP wise annual audit reports issued by KSAD. Internal audits on use of BG funds will provide secondary assurance on use of BG funds. Together the KSAD and internal audits will show whether funds equal to the IDA’s contribution have been used on the list of activities agreed with GoK. Additionally, the use of social accountability mechanisms (like social audits, regular Gram sabhas and publication of GP accounts) will strengthen assurance. The FC will monitor both KSAD and AFS audit will respect to this component. FC will also liaise with KSAD on a regular basis to ensure that the GPs receiving BGs are audited in time. In case there is a shortage of staff at KSAD, the FC will flag this to RDPR and as agreed with Ministry of Finance (GoK) ensure that capacity is augmented through private auditors as has been agreed under the SFAA follow up action plan.

5 GoK transfers to GPs will be considered on a net of deductions and intercepts basis.

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Implementation arrangements on Components B, C and D - Investment Components

The FC within the RDPR will be responsible for the implementation of Components B, C and D of the project through PIAs which will be TP which will be responsible for building the Taluka Resource Center (TRCs) buildings and empanelling consultants for FM reform, Gram panchayats (GPs) which will be responsible for procuring computers for themselves in order to implement new accounting method and ANSSIRD which will be responsible for building SATCOM centers and for equipping these. The FC will be the accounting centre for the purpose of the project. It will allocate spending limits to the TPs, GPs and ANSSIRD on the basis of annual work plans. TPs will make payments through the Treasury while GPs and ANSSIRD will make payments through their respective commercial bank accounts.. All goods, works and services will be paid for and received by the PIAs. Expenditure reports generated by the PIAs will be sent to the FC monthly and based on these the FC will prepare project’s annual financial statement. Control on expenditures will be exercised through the oversight arrangements at the PIAs: the TPs, GPs and ANSSIRD wherein it will be ensured that all payments are approved in keeping with the prevailing delegation of financial powers in the state of Karnataka. All project payments will be made in accordance with the Karnataka Financial Code. In addition the FMS at the FC will exercise control on the payments, and ensure that the state government financial rules and procedures applicable to that entity are followed. The FMS at FC will be responsible for ensuring that all state government financial rules applicable to the expenditures are followed, a robust control environment is in place expenditure reporting is timely and adequate and the claims are submitted in time. The roles and responsibilities of the PIAs are laid out below:

1. TPs will be responsible for civil works expenditures on the construction of TRCs and for the empanelment of consultants to roll out FM reforms. The expenditures on civil works will be made in accordance with the prevailing Public Works Department rules. RDPR envisages no expenditures on account of empanelment of the TRC Accountants. The TPs will be responsible for providing guidance to the GPs on contracting procedures to be used for hiring TRC Accountants. The Accounts Superintendent at the Taluka will be responsible for rendering monthly accounts to the FC and ensuring that all the applicable state government procurement procedures are followed.

2. GPs will be responsible for their own computer hardware purchases. A list of empanelled vendors, required specifications and necessary procurement rules will be passed on to the GPs. The GPs will select computers and come to the CHIEF EXECUTIVE OFFICER, ZP or an officer designated by him for certification. Approval will be accorded within 30 days of the proposal failing which the GPs can purchase as per the guidelines. GPs will make payments through their bank

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accounts.. The TPs shall maintain and compile accounts of the GPs’ expenditures on hardware and report to the FC for consolidation and audit purposes.

3. ANSSIRD will be responsible for construction of the SATCOM centers and procuring equipment for these. The Director at ANSSIRD will be allowed to issue payments from the FC’s Bank account to the consultants and contractors for project expenditures. It will also be his/her responsibility to ensure that monthly expenditure statements are submitted to FC and that all procurements are in accordance with state government procedures.

4. The State government officer who is assigned to DAC will be allowed to draw moneys from the FC account for research and other project related expenditures. Control on these expenditures will be exercised by the Secretary Finance or designated authority. The officer in charge at DAC will submit monthly expenditures and supporting documentation to the FC.

The FMS will prepare project accounts (which will also be FMRs) based on expenditure reporting by the PIAs. It will be the responsibility of the FC to liaise with the PIAs on the timing and nature of expenditure reporting required. FMS will submit FMR-based claims on the basis of the expenditure reports. Supporting documentation in respect of project expenditures will be maintained by the individual PIAs. These expenditures and the relevant supporting documents will be examined during the audit of the annual financial statements of the project. It will be the responsibility of the FMS at the FC to ensure that the audit of AFS is timely, that the audit of expenditures at the different PIAs is carried out and that the physical verification of assets created at different levels is carried out.

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Implementation and Fiduciary Arrangements

Implementing Entity

Accounting Audit Procure-ment of goods/ works & services

Controls/ Fiduciary Framework

Reporting to PMU

Reporting to Bank

I. Programmatic (Block Grant) Component

GPs

Use of BG Funds will be recorded in the book of GPs. Transfers of BGs will be recorded in AFS of project and in the books of GoK

Audit of GP books by KSAD Internal audit of a sample of GP’s by a firm of private auditors. Audit of AFS at FC (including the expenditures by PIAs) to be done by private auditors.

GPs responsible for all procure-ment

RDPR will issue directives about eligible activities that BG funds can be used for which will be detailed in the OM. Proposed uses of BG’s must be vetted in Gram sabha meetings. KSAD and internal audits will verify uses of BG funds

Gram panchayat

FC

II. Investment Component GPs, TPs , ANSSIRD which are Project Implementing Agencies (PIAs)

In the AFS at FC based on expenditure reports submitted by GPs, TPs and ANSSIRD and verification of records at the different PIAs as necessary

Audit of AFS by private auditors

PIAs FMS at FC and through controls in place at PIAs

PIAs FC

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Funds Flow Arrangements Brief Overview of Funds Flow

GoI will open a Special Account (SA) in Reserve Bank of India (RBI) to receive disbursements from the Bank. The Comptroller of Aide Accounts and Audits will operate the SA. The funds transfer from GoI to GoK will be decided in accordance with the GoI decision on funds transfers for Externally Aided Projects (which has not yet been announced). At the beginning of year one, the Bank will advance the first six months’ expenditure to the SA, thereafter reimbursements will be made every six months based on audited FMRs. On the investment component, the FMRs will report and fund actual expenditures while on the programmatic component transfers will be reported and funded. The project will be budgeted as two single line items in GoK’s budget. The Block Grants will be budgeted as a Capital head of expenditure under appropriate guidance from National Government Accounting Standards Board (GASAB) and the Comptroller and Auditor General (CAG) the budget codes of these expenditure heads will be decided at the time of budget preparation by GoK. The investment component expenditures will be

GOK FINANCE DEPARTMENT

RDPR - FC

BUDGET RELEASE ON

INVESTMENT COMPONENT

TREASURY PAYMENTS

BUDGET RELEASE ON

PROGRAMMATIC COMPONENT

COMMERCIAL BANK ACCOUNT OF INDIVIDUAL GPs

TP GP ANSSIRD

COMMERCIAL BANK ACCOUNT

RDPR-FC

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reported another budget line item in accordance with the pattern for other externally aided projects. GoK will provide advance funds to commence the project. At the beginning of each year, the allocation to the RDPR under the respective heads for the investment and the programmatic components would be made available to the FC. Thereafter, FC shall transfer programmatic funds to the bank accounts of the GPs, release spending authority to TPs to spend through the Treasury and to ANSSIRD and GPs (for hardware) through their bank accounts. Staffing At the State Level A Project Coordinator who will report to the Secretary RDPR will head the FC at the RDPR. In addition, there will also be a Financial Management Specialist (FMS) with qualifications acceptable to IDA. The PC and FMS staffed positions will remain in place throughout the life of the project (This will be a financial Covenant). In addition, the Accounts Superintendent at the TP, Secretaries at GPs and the Accounts Superintendent at ANSSIRD will be responsible for maintaining and submitting expenditure reports and relevant supporting documentation of project funds expended by their respective agencies. The TP- EO, GP-Adyaksha and the ANSSIRD-Director will be responsible for exercising control on expenditures. At the Village Level At the village level, the Secretary, who is an official of the State Government is deputed to the GP and is routinely responsible for all the financial and administrative matters will also account for the BG money. All project funds will be in the nature of Block Grants (for the specific purpose of improvement and expansion of services) and will be accounted for within the existing accounting, reporting and audit framework of the Gram panchayats. Accounting Policies and Procedures At the State level In the books of GoK: In respect of the accounting treatment of the proposed Block Grants from GoK to PRIs through the project (capital vs revenue) in the books of the state, a clarification has been sought by GoK from the GASAB, which is housed in the Office of the CAG of India, through the Principal Accountant General of Karnataka. The GASAB and the Principal Accountant General are yet to revert back with an opinion on whether the Block grant can be treated as capital and revenue expenditure in the books of the State government. Pending a final clarification from the authorities concerned, it was agreed that GoK would continue with the existing accounting treatment of such block

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grants in its Books and thereafter will revise the accounting treatment, if required, on the basis of final advice received. Other than TRC construction civil expenditures, which will be reported with the Block Grants, all other investment component funds will be shown as a separate budget line item in the books of the state. The code under which these will be booked will be decided at the time of budget preparation. In the Project Financial Statements: At the state level, the FMRs that also will be AFS will be used to account for both the BGs and the investment component funds. The AFS will be Statements of Sources and Uses of Funds prepared on Cash Basis. For the BG component, the AFS will show transfers from GoK to the GPs and also the transfers on account of Bank contribution. For the investment component, the AFS will account for actual expenditures. For the investment component, all expenditures reported in the AFS will be tallied with the expenditures booked in the accounts of the entities receiving project funds. For the BG component, the FMS at the FC will be responsible for ensuring that transfers reflected in the project AFS are tallied with the transfers shown on account of GoK will be tallied with the Transfers as per state accounts. The Bank’s BG transfers will be tallied with the relevant account head in the books of the State government. At the village Level The accounting arrangements at the village will be mainstreamed. The GP accounts as mandated by the Karnataka PRI Act will account for the BG funds received as well. Internal Controls Controls on the Investment component expenditures will be exercised by the FMS at the FC and through the prevalent state government controls on expenditures through TPs, GPs and ANSSIRD. The persons responsible for making project expenditures will be the TP-Accounts Superintendent, GP-Secretary and ANSSIRD Accounts Superintendent, while the responsibility for oversight will be that of the TP-EO, GP-Adhyaksha and ANSSIRD-Director. Controls on the BG funds will be through the fiduciary framework that is put in place in this project. This framework will ensure that directives from the RDPR regarding the eligible expenditures for use of BG funds, that regular Gram sabhas are held to document the proposed uses of BGs; that there are approval procedures in place which ensure that BGs are proposed to be used only for the extension and expansion of services as envisaged under the 29 items devolved to the GPs. A firm of private accountants will undertake additional fiduciary reviews of a sample of GPs receiving Block Grants periodically during the implementation phase. The purpose of these reviews will be to provide additional assurance of the controls at the GP level and recommend strengthening actions if required. RDPR will create a panel of CA firms in consultation with KSAD from which the reviewers will be selected. This panel may be

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either at the district level or at a regional level6 to conduct these special reviews in which both financial management and procurement will be covered at the GP level. For the purposes of monitoring, capacity building and assurance on end use of BG funds, the RDPR will monitor the Consolidated audit report of GPs receiving Block Grants audited by Karnataka State Audit Department (KSAD). External Audit

• For fiduciary purposes the following report will be received by the Bank and

monitored in audit report compliance system:

• Audit of FS)/ FMRs (all components). A firm of private Chartered Accountants

will audit these.

6 GoK will develop criteria for selection of the audit firms and TORs describing the scope of the audit to be conducted.

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Risk Analysis

Risks Risk Rating

Risk Mitigation Measures

The Department of Finance may intercept the entire funds as GP dues

M a) Transfers to GPs will be monitored by the FC and also by IDA during Supervision Missions;

b) RDPR has assured the Bank that SFC transfers to BGs will be effected without intercepts at the Finance Department

Inherent weakness in the accounting and financial reporting systems in the PRIs lead to a risk of misuse of funds that may not be detected and accounts may not be maintained properly

H c) Ongoing and agreed financial management improvement measures by GoK will be closely monitored over the implementation period to ensure that action plans are followed.

d) KSADs annual report on the GPs will be reviewed by IDA and will provide assurance;

e) In addition to the KSAD audit of GP, GoK will engage CA firms to conduct annual audits of GPs on sample basis, in 5 selected districts each year;

f) Fiduciary risk reviews will be carried out IDA in consultation with GoK in Years 1 and 2 of the project and later if need be.

H – High, S – Substantial, M – Modest, N - Negligible Overall FM risk is High Strengths and Weaknesses Strengths The project has the following strengths in the area of financial management:

a) Karnataka being revenue surpluses state there should not be any fund flow problems.

b) New accounts, audit and works manual for GPs has been prepared and approved by GoK.

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Significant weaknesses Significant Weaknesses Mitigation Measures The capacity of GPs for bookkeeping and accounting is limited. They will need support in maintaining the books of account.

The following steps built into the project design will ensure that an adequate financial management system is in place:

(i) Proper, simple financial management and accounting manuals are in place;

(ii) The TRC which will include a professional accountant will be created at each Taluk to provide assistance to the GPs on demand

(iii) Institutional arrangements for social audits at the village level will provide the framework needed to ensure that there are checks /balances and transparency in the operations.

Country Issues

The generally weak financial management environment at the GP level is a cause for concern. This will be mitigated through the capacity building and FM reform components. Reporting and Monitoring The project will provide FMRs on a six monthly basis. These will be the same as the AFS for the project. For the BG component the FMRs / AFS will report on transfers, on the investment component they will contain a break up of sources of funds and uses of funds by project activities. Disbursement Arrangements Disbursements from IDA credit will be made based on 6 monthly FMRs. The FMRs will reflect actual expenditures for the investment component while for the BG component they will reflect transfers to the GPs. On the Investment component, the Bank will finance actual expenditures that are made on project components B, C and D as reported in the FMRs. On the programmatic component, the Bank will finance transfers to the GPs. In year one of the project, Rs. 800,000 per GP for each of the 1,343 GPs in the poorest 39 Talukas of state will be disbursed as Block Grant. From year two onwards the transfers will be based on a formula that will be determined by the DAC under the guidance of RDPR. The Bank’s funding will be contingent on GoK’s transfer of Rs. 500,000 per GP per year as mandated by SFC. It is agreed that RDPR will transfer the SFC commitment without any

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intercepts in four equal tranches. Accordingly, programmatic component BG funds will be released on a quarterly basis. In case the GoK releases are not made for even one of the two quarters, Bank BG funds will also not be released. All program expenditures / transfers reported in the FMRs will be subject to confirmation/certification by the annual audit reports. Any discrepancies between the amounts of grants in aid reported by the FMRs and those reported in the annual audit reports will lead to adjustments of subsequent disbursements, to be recovered or reimbursed to GoK, through the next disbursement in the following schedule. A tentative disbursement table has been mentioned below.Tentative Disbursement Schedule

Expenditure Period

FMR Due Disbursement Audit Due Adjustment GOK Financial

Year Oct ’06 - Mar ‘07

May ‘07 Advance Sept 06

Sep ‘07 June ‘08 2006-2007

Apr ’07 - Sep ‘07

Nov ‘07 Dec ‘07 Sep ‘08 June ‘09 2007-2008

Oct ’07 - Mar ‘08

May ‘08 June ‘08 Sep ‘08 June ‘09 2007-2008

Apr ’08 - Sept ‘08

Nov ‘08 Dec ‘08 Sep ‘09 June ’10 2008-2009

Oct ’08 - Mar ’09

May ‘09 June ‘09 Sep ‘09 June ’10 2008-2009

Apr ’09 - Sep ’09

Nov ‘09 Dec ‘09 Sep ‘10 June ’11 2009-2010

Oct ’09 - Mar ’10

May ‘10 June ’10 Sep ‘10 June ’11 2009-2010

Apr ’10- Sep ’10

Nov ‘10 Dec ’10 Sep ‘11 June ’12 2010-2011

Oct ’10- Mar ’11

May ‘11 June ’11 Sep ‘11 June ’12 2010-2011

Apr ’11- Sep ’11

Nov’ 11 Dec ’11 Sep ‘12 June ’12 2011-2012

Key Disbursement Issues:

1. In order to ensure that BG funds are used appropriately and to allow time for adjustment of used funds or funds that was not properly used, there will be no BG disbursements in the last six months of the project.

2. GoK has opted for a model of disbursement wherein a default by GoK on its statutory SFC grant to the PRIs will freeze the Bank’s transfer of BGs completely. Since there have been slippages in the GoK transfers of SFC mandated funds to GPs in the remote past, tying Bank disbursements to the absolute level of transfers places a large responsibility on GoK for timely and committed flows and also

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predicates Bank disbursements on these. The possibility of preparing a calibrated scale of disbursements (ie. Bank matches % GoK SFC mandated disbursement with proportionate transfers) was also discussed with RDPR but this was not acceptable to GoK.

3. The FC will have to be very stringent in monitoring the fiduciary framework for the BG component. In addition to the fiduciary framework, the GPs are required to fulfill certain other conditions as well on financial management reform, acceptance of planning guidelines and public display of FM and procurement information before GoK funds are released to them. Therefore, if the GPs default on this they will be ineligible for any additional funds from GoK.

Supervision Plan From a financial management perspective, the project will need intensive supervision. The focus during the supervision will be on monitoring the timeliness of the fund releases to GPs, improvements in the accounting and financial management systems at the GP level, effectiveness of the capacity building plans, timeliness of the financial reporting by the various accounting centers under the project, adequacy of the financial monitoring reports, timeliness of submission of the audit reports etc.

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26. Annexure-13

Sl.No Description of Goods / Works

Number / Units

Estimated costs INR ( Rs. )

Method of Procurement ( ICB/NCB/ Shopping )

Year / Month of the Project (I, II, III

etc)

18 Months Requirement (

Rs.)

1 Block Grants 1343 5,100,000,000 NCB/Shopping/Others I to V 1,343,000,000

2a) Development of Monitoring Software

Lumpsum 600,000 NCB I 600,000

b) Charts & Posters, Self Reading Materials, Wall News papers

Lumpsum 7,000,000 NCB/Shopping I, II, III, IV & V 1,400,000

c) Electronic Materials Lumpsum 2,500,000 NCB/Shopping I,II, III & IV 625,000 d) Training Modules Lumpsum 500,000 In House(Shopping)) I & II 500,000

Sub Total. . . 10,600,000 3,125,000

3

a) Civil works (consolidated)

175 320,000,000 NCB I, II 160,000,000

b) Various Equipments for Taluk Resource Centres

175 65,000,000 Shopping I, II 35,000,000

Sub Total. . . 385,000,000 195,000,000 4

a) Hiring of Consultants Lumpsum 7,500,000 CQ/Individual I to V 1,500,000 b) Hiring of Programme Assistants

Lumpsum 3,000,000

CQ/Individual I to V 600,000 c) Hiring of Supporting Staff (contractual)

Lumpsum 4,200,000

CQ/Individual I to V 840,000 Sub Total. . . 14,700,000 2,940,000

5

Hiring of Consultants 39x3 30,000,000 CQ/Individual I to V 10,000,0006

a) Establishing 4 Regional SATCOM Training Centers

4 20,000,000 I & II 10,000,000

b) Upgradation of SATCOM facility at ANSSIRD

Lumpsum 5,000,000 I & II 5,000,000

Sub Total. . . 25,000,000 - - 15,000,000 7 Action Research & Development

Hiring of Consultants and Others Lumpsum 7,500,000 CQ/Individual I,II,III 2,500,000

8a) Hiring Buildings for Offices Lumpsum 6,000,000 NCB/Shopping I to V 2,000,000b) Office Furnishigs & Various Equipments Lumpsum

8,000,000 NCB/Shopping I to II 6,000,000c) Hiring of Consultants Lumpsum 40,000,000 CQ/Individual I to V 8,000,000d) Hiring of Vehicles Lumpsum 15,000,000 NCB/Shopping I to V 3,000,000

Sub Total. . . 69,000,000 19,000,000

GRAND TOTAL 5,641,800,000 1,590,565,000

Incremental Operating Costs ( FC & DCA )

Gram Swaraj - Karnataka Panchayat Strengthening Project

NCB

Civil Works & Equipment - Taluk Resource Centers (TRCs)

Consultancies and Management - ANSSIRD

Consultanciest - TRCs

Goods and Equipments - SATCOM CENTERS

PROCUREMENT PLAN

INVESTMENT COSTS

Training and Capacity Building

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27. Annexure-14

Model Gram Panchayat Plan - Guidelines

As per Section 309 of the Karnataka Panchayat Raj Act 1993, Panchayat Raj

Institutions have to prepare economic development and social justice plan. 29 subjects

have been devolved to the Panchayat Raj Institutions through 73rd Amendment of the

Constitution and these institutions have to prepare plan and implement the same.

Hitherto Gram Panchayats used to get Rs.5 lakhs from the State Government and

the same was being spent towards Water supply and electricity bills. Action Plan was

prepared and implemented for generation of employment and creation of durable assets

under centrally sponsored Sampoorna Gramina Rojgar Yojana. Apart from this funds

were also made available under Central Finance Commission’s Grants and maintenance

grants of water supply schemes. As per the Government Order dated 16-10-2004 more

than 30 programmes have been devolved to the Grama Panchayats. Functions of Grama

Panchayat are mentioned in Section 58 of the Karnataka Panchayat Raj Act 1993. With

this background it is necessary to prepare long term and annual development plans by

Grama Panchayats. For the benefit of Grama Panchayats a model plan preparation

guidelines have been given below based on the experience gained in the previous years.

Grama Panchayats have to prepare the plans for 5-10 years of duration.

Considering the funds available in each year. The plans have to be prepared on the basis

of priorities. The said plan could consider in the following four important points:

1. Where are we?

2. Where do we go?

3. How do we go?

4. How do we review the progress?

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1. Where are we?

It is important to know the actual situation of the Grama Panchayat area before we

decide about the subject for development. For this the following surveys are essential:

a. Natural Resources Survey

b. Basic Infrastructure Facilities survey

c. Household survey

d. Financial Resources survey

a. Natural Resources Survey

Information about natural resources and geographical information has to be

collected from Agriculture and other departments. Eco-zones, watershed zones, the

nature of soil, water and live stock details of the Gram Panchayat limits has also to be

collected. This information has to be verified and confirmed by traveling across the area.

This helps for proper utilisation of the resources for the plan.

b. Basic Infrastructure Facilities survey

Grama Panchayat has to list out the present basic facilities. Departmental-wise

information has to be procured. This helps to provide the required facilities.

c. Domestic/Family Survey

Survey has to be conducted regarding the actual status of the families under the

Gram Panchayat limits. This helps in the preparation of Human Development, Economic

and Social Developmental Plans, which also helps in effective implementation of the

Poverty Alleviation and Unemployment Eradication programmes. Various departments

have conducted many surveys. The information of all these surveys has to be

consolidated and analyzed for the preparation of the developmental projects. The

available information can be utilized or the new surveys can be conducted using

PRA/PLA/PPA techniques.

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d. Financial Resources survey

Financial Resources is very much necessary for the implementation of the

developmental programmes. Hence it is to be estimated how much of resources could be

available from different sources. The available resources of the Gram Panchayats could

be classified as follows:

1. Own resources

2. State Government Programmes

3. Centrally Sponsored and Central Plan Programmes

4. Contribution, Donation etc.

As per the Government Order dated 16-10-2004 the following programmes of State and

Central Government are devolved to Gram Panchayats:

1. Gram Panchayat Libraries

2. Rural Water Supply Schemes- repairs & maintenance

3. Maintenance of Bore wells

4. Accelerated Rural Water Supply Scheme (ARWSP)- Central

5. National Rural Water Supply Scheme (NRWSP) - State

6. ARWSP-Sub Mission

7. Pradhana Manthri Gramodaya Yojane (Rural Water Supply)

8. World Bank Assisted-Jal Nirmal Water Supply Scheme

9. Rural Sanitation (Total Sanitation Campaingn)

10. Swacha Grama Yojane (Clean Village Program)

11. Centrally sponsored scheme for reclamation of saline alkaline water logged areas

12. Centrally sponsored scheme of soil conservation in the river valley project

13. National Watershed Development Programme

14. ODA assisted Watershed Prgromme KAWAD project

15. NABARD assisted Watershed Development Programme

16. Drought Prone Area Programme

17. Desert Development Programme

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18. Integrated Wasteland Development Programme

19. Western Ghat Development Programme

20. Vana Samvardhane Yojene (Social Forestry)

21. Swarna Jayanthi Gram Swarozgar Yojane (Self-employment program)

22. Sampoorna Grameena Rozgar Yojane(Wage employment program)

23. Integrated Rural Energy Programme

24. Biogas Development Programme

25. Ashraya (Housing)

26. Indira Awas Yojane (Housing)

27. Pradhana Mantri Gramodaya Yojane (Housing)

28. Tanks

29. Ganga Kalyana (Community irrigation)

30. Jala Samvardhana Yojane (Minor irrigation/tanks)

31. Rehabilitation of Bonded Labour

32. Grants to Grama Panchayats ( State Statutory grants of Rs 500000)

33. Grants to PRIs under Central Finance Commission

New schemes (2005-06)

34. Kugrama Suvarna Grama (Development of backward villages)

35. Namma Bhoomi – Namma Thota (Land to landless agricultural labourers)

The funds available in these programmes have to be calculated.

2. Where do we go?

The points emanated from the above surveys have to be analyzed. The outcomes

of the surveys shall be discussed with the technical expertise and comparing the

development indices of the Gram Panchayats with that district and the state level indices,

it is to be decided to what level the Gram Panchayat should be taken to under each sector.

Final decision has to be taken in this regard in Standing Committee and General body

meetings after detailed discussion. Then this has to be placed in Ward Sabhas. In

addition to suggestions, the local people could raise their demands and problems and

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solution to these problems. All these points have to be listed. The proposals received

from all Ward Sabhas have to be consolidated, analyzed and listed sector wise for placing

before the Grama Sabha Meeting. The Grama Sabha could be converted into a seminar.

The members of the Grama Sabha interested in various fields could be identified and

grouped them into different sectoral groups along with technical experts. These sectoral

groups will discuss in detail the proposals of the Ward Sabhas and come out with the

final proposals. At the end group leaders will present their proposals and what should be

achieved in each sector. These proposals presented by the groups would be prioritised

and finalized with suitable amendments after detailed discussion in the General Body of

the Seminar.

3. How do we go?

Plans have to be prepared on the basis of funds available ( financial resources

survey) and allocating the funds to the programmes decided by the Grama Sabhas.

Annual Programmes have to be prepared on the basis of the priorities decided in the

Grama Sabha. Criteria could be evolved to implement the Programmes. The programmes

which are leading to Human Development, Area Development, Economic Development,

Social Development through Social justice could be included in the plan to get the

desired out puts. In addition to this, transparency, right to information, improvement in

the services at GP level could also to be considered. Matching the grants to works or

schemes is not a plan. It should cover all the aspects that lead to development.

Administrative reforms and the manner in which Ward Sabha, Grama Sabha, Standing

Committee and General Body Meetings have to be conducted and decisions taken under

decentralisation system should also form part of the plan.

4. How do we review?

It is important to know whether the programmes prepared for 5-10 years duration

are effectively implemented? Do they give expected results? Hence continuous review

of the implemented programmes is necessary. The problems in the implementation

could be solved in the MMR Meetings. Mid term evaluation could be taken up to know

whether the implemented projects are giving desired results in a stipulated time period?

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Whether public and area benefited? Is there any deficiency in the implementation of the

projects? Whether the targets have been achieved? Light can be thrown on these subjects

in the reports of evaluation studies conducted by the external agency with technical

expertise. All these points need to be incorporated in the developmental plan reports of

the GPs.

Preparation of Developmental Plan Report

Developmental Plan Report can be divided into 3 parts. In the 1st part, general

information and present level of GP with regard to development( where we are?) should

be provided. In 2nd part, sector wise details regarding where do we go? And how do we

go? could to be given. The details regarding Monitoring and Evaluation etc. have to be

incorporated in the 3rd and last part. All the details and statistics need to be provided for

each of the subjects. Programme wise funds provided annually should be given in the

annexure.

The following chapters could be incorporated in the Developmental Plan Reports:-

Gram Panchayat/Developmental Plan Report

Part-1: Resources & Development (Where are we?)

1. Introduction

2. Bio-Physical Resources

3. Human Resources

4. Financial Resources

5. Review of progress during previous plan period

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Part-2: Sectors

(Where do we go? - how do we go?)

1. Administration: Follow and implement the following:-

• Decentralization

• Right to information, Social Audit

• Responsibility

• Transparency

• Ombudsman & Controlling Mechanism

2. Social justice and Empowerment: Take adequate care to address the following issues:-

• Development of SCs &STs, Backward Classes & Minorities

• Gender related issues, Women Empowerment

• Children Rights, Eradication of child labour system

• Rights of Physically & mentally retorted persons

• Employment rights, eradication of bonded labour

• Right of Elders, Social Security, Insurance

3. Eradication of Poverty: focus on:-

• Providing Wage Employment

• Providing self employment

• Homestead plots, sites and houses for houseless

• Improvement in credit system

• Small and cottage industries

• Public Distribution System

4. Education:-

• Primary and Secondary Education

• Mass Education & Literacy

• Libraries

• Play grounds

• Higher education

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5. Health & Sanitation

• Basic facilities of public health

• Drinking water Supply

• Toilets, Environmental Cleanliness, Drainage & waste management

• Eradication of epidemic diseases

• Awareness regarding fatal disease etc.

• Nutrition for women & children

6. Agricultural allied activities:

Agricultural allied

a. Agriculture, Horticulture

b. Fisheries

c. Agro Forestry including social forestry

d. Animal husbandry

e. Agro industry including food processing

b. Development of agriculture infrastructure

f. Minor irrigation, tanks

g. Watershed development

h. Waste land Development

c. Backward & Forward Linkages

i. Supply of Seeds fertilizers, insecticides, etc.

j. Providing technical assistance

k. Farmers fairs, local shandies, market yards, animal shandies Providing

marketing information

l. Providing Credit from financial institutions

m. Insurance facilities

6. Development of Basic amenities

a. Roads and Bridges

b. Transportation

c. Electrification

d. Non-conventional sources of energy

e. Constructions and maintenance of Community Development

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Part-3: Conclusion: (How do we review)

f. Reforms

g. Monitoring & Evaluation

h. Conclusion

The said developmental plan report should be approved by the Grama Panchayat and

implemented accordingly.

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28. Annexure-15

Illustrative List of Capital Works Implemented by Grama Panchayats

1. Minor Irrigation, Watershed Development

• Construction of Percolation Tanks and MI Tanks

• Water harvesting structures

• Soil and Water conservation on Watershed Basis

• Wasteland Development

2. Primary and Secondary Education

• Primary and Secondary School Buildings

• Play Grounds

• Laboratory with equipments

• Kitchen Rooms

• Primary and Secondary School Buildings including Additions and

Alterations

• Open Air Theatres, Play Grounds

• GP Library Buildings

3. Animal Husbandry, Dairy and Poultry

• Construction of Primary Veterinary Centers

• Artificial Insemination Centers with Equipments

• Milk Collection Centers with Equipments

• Poultry Complexes

4. Fisheries

• Construction of Village Ponds for Fisheries

• Improvement of Tanks for Fishing

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5. Social Forestry, Minor Forest Produce (MFP)

• Social Forestry

• Farm Forestry

• Plantation of MFP

• Soil Conservation and Plantation in Degraded Forests

6. Small Scale Industries including Food Processing Industries

• Establish Small Rural Industrial Estates and Complexes

• Establish Food processing Complexes

• Construction of Common Worksheds / Workplaces and Market complexes

with Equipments

• Land and Building for Village Fairs and Weekly Markets

7. Housing

• Construction of Houses for Houseless Poor or residing in temporary Huts and

not covered under any Housing Programmes

8. Drinking Water Supply and Sanitation

• Construction of Wells, tanks and Water Supply Schemes with water resources

protection

• Augmentation of existing Water Supply Schemes

• Water Supply and Sanitary Latrines to Schools and Anganwadies

• Community Latrines

• Bathing and Washing Places, Public Compost Yards

• Paving of Roads, Drainages

9. Roads and Bridges

• Construction of Village Link Roads, Bridges and Village Lanes

• Improvement of Existing Roads, Culverts and Bridges

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10. Electrification and Non Conventional Energy

• Street lights

• Installation of Community Sources of Energy such as Bio gas, Bio-mass,

Solar Energy and Wind Energy

11. Health and Family Welfare

• Addition and Alteration to ANM Sub Centres

• Maternity Homes to PHCs with Equipments

12. Social Welfare, Women and Child Development

• Construction of Government Hostel Buildings

• Construction of Anganwadi Centers

13. Public Distribution System

• Godown for storage of Foodgrains and shop

14. GP Assets

• Construction of Panchayat Buildings

• Construction of Additional Rooms for providing office space for the

Functionaries various departments according activity mapping

• Additions and Alterations to Existing GP Assets

• Public park, Bus Stand, GP Stadium

Works Not Permitted Under Gram Swaraj

• Religious Buildings (Temple, Masjid, Church, Prayer Halls etc.)

• Community Halls, Kalyan Mantap

• Assistance to Private Institutions

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29. Annexure-16

Activity Mapping

Activity Zilla Panchayat Taluk Panchayat Grama Panchayat AGRICULTURE

1. Prepare comprehensive crop plan

1.Assist ZP in organising Farmers fairs, Kisan Melas, etc.

1. Estimate crop yield and maintain data base regarding crops and cropping pattern,

2. Develop and maintain data base for cropping pattern, land use and inputs use for planning

2. Organise on-farm verification trials and demonstration of new technologies

2. Assist in preparation of crop plan,

3. Organise Kisan Melas, Fairs and Exhibitions

3. Report and initiate action plans for different items

3. Assist in advising farmers about remunerative crop activities and crop diversification

4. Protect bio-diversity

4. Coordinate activities of field level extension workers and officials

4. Assist in identifying progressive farmers for adoption and diffusion of new technologies

5. Promote profitable crop technologies

5. Act as a link between ZP and GPs for transfer of knowledge,

5. Help in providing custom hiring services for plant protection equipment and farm implements

6. Help in crop yield estimation through maintaining links with various agencies, GPs and farmers,

6. Generate awareness in use of organic fertilisers and vermiculture

7. Advise suitable cropping system based on location specific characteristics.

Increasing Agricultural Production

8. Arrange awards to progressive farmers

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Activity Zilla Panchayat Taluk Panchayat Grama Panchayat

1.Prepare consolidated plan for input requirement

1. Assess inputs needs for GPs inputs and forward consolidated request to TP

1. Assist in assessing needs of various such as seeds, fertilizers, pesticides.

2. Acquire and arrange distribution of inputs in time

2. Ensure timely availability of required inputs to GPs

2. Assist in timely distribution of adequate inputs to farmers

3. Improve adequate storage facilities for inputs

3. Arrange storage and transport facilities for inputs close monitoring of inputs delivery system

Assessment and Distribution of Inputs

4. Monitor distribution of quality inputs

1. Prepare credit plan 1. Assist in preparing credit plan

1. Assist in assessing credit needs of various groups of farmers and crops

2. Ensure timely credit availability and linkage between agriculture development and credit institutions, and monitor credit mobilisation.

2. Ensure timely credit from formal institutions.

2. Exercise social control and regulate interest areas and recovery of loans from formal and informal credit institutions,

Credit

3. Help in strengthening of cooperative credit institutions

3. Monitor credit delivery system.

3. Help in formation of self-help Groups

1. Maintain linkage with research and training organizations,

1. Prepare plan for visit of extension workers and monitor their work.

1. Monitor the visit of extension workers to the village farms.

Extension support

2. Ensure regular visits of extension staff and help in dissemination of new technologies.

2. Advice and identify extension officials for training,

2. Identify suitable plots for conducting trials and demonstration

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Activity Zilla Panchayat Taluk Panchayat Grama Panchayat 3. Ensure regular

training of extension officials for updating their knowledge of advancements in technologies.

3. Assist scientists in identifying local problems for designing their research work relevant to local needs.

3. Select farmers for participating in Kisan melas and training.

4. Ensure better linkages between farmers and extension staff.

5. Operate and run farmer service centres, Kisan Kendras and Raitha Samparka Kendras

Soil Testing

Establish soil-testing laboratories.

Monitor soil testing work

Monitor Soil testing work

Help in identifying locations for soil testing work

Help farmers for improvement of soil fertility in consonance with soil testing results

Assist technical experts in conducting soil tests.

Help in ensuring feed back from soil testing to farmers.

1. Establish and improve storage facilities

1. Maintain godowns

1. Help in organizing farmers for group sale in bulk

2. Develop marketing infrastructure at suitable locations

2. Organize marketing committees and maintain market yards

2. Assist in increasing awareness about better storage facilities for seeds and food grains.

3. Monitor regulated marketing

3. Regulate market charges and ensure correct weights and measures

4. Ensure correct weights and measures.

4. Provide, manage and run market information systems

Post-harvest management

5. Ensure prompt payment to the farmers

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Activity Zilla Panchayat Taluk Panchayat Grama Panchayat 1. Assess losses due to natural calamities and formulate relief plan

1. Estimate crop losses and report action taken,

1. Report losses due to natural calamities and relief requirements

2. Monitor and supervise relief operations

2. Monitor relief operations.

2. Supervise relief operations and distribution of material

3. Assist in providing benefits from Crop insurance schemes.

3. Motivate and help in identifying farmers to take up crop insurance schemes.

4. Arrange crop insurance schemes and coordinate among insurance agencies

4. Assist in the implementation of contingency plan.

Risk Management

5. Prepare contingency agricultural plan

1. Guide and coordinate the work of GPs & IPs.

1. Coordinate the work of GPs where inter-GP collaboration is needed.

1. Primary responsibility for keeping all common property of local nature in good condition.

2. Provide legal administrative and financial assistance to GPs & TPs as far as practicable, in the conduct of legal proceedings

2. Coordinate with the legally constituted machinery involved in the matter

2. Keep watch over them so that they are not encroached upon or converted to uses not in the interest of the community.

Protection and Maintenance of Village Commons etc.

3. Decide on disposal of village common property or their conversion to other uses with the concurrence of the GP concerned.

3. Identify encroachment as well as conversion of illegal or wrong uses of commons.

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Activity Zilla Panchayat Taluk Panchayat Grama Panchayat

4. Provide assistance in and collection of evidence towards the conduct of the proceedings by such authority.

1. Preparate district plan for soil and water conservation projects.

1. Coordinate with officials of soil conservation machinery.

1. Assist the professional/official machinery for soil conservation work through helping group action by land owners,

2. Desegrete this plan into TP level, GP level or even lower level deliverable units,

2. Inter GP coordination for smoothly carrying out soil conservation operations cutting across GP boundaries including creation of water channels

2. Direct assistance in implementation e.g., organising owner labour as part of contributions of the cost of operations,

3. Harmonise the plan with other employment generating as well as area development plans Coordination with various agencies of the ZP as well as the district administration who will either participate in or whose work will impinge upon the implementation of the plan

3. Post conservation vigilance to ensure that work done is not undone once again,

Soil Conserva-tion

4. Create public opinion in favour of use of soil only in consonance with its properties, gradients etc.,

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Activity Zilla Panchayat Taluk Panchayat Grama Panchayat

5. Distribute subsidies and other assistance according to determined scales and priorities

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MINOR IRRIGATION, WATERSHED MANAGEMENT AND WATERSHED

1. Formulate MI projects

1. Formulate MI Projects

1. Assist in formulation of MI projects and ratification by Grama Sabha

2. Technically appraise MI projects (outside TP purview)

2. Technically appraise MI projects proposed in TP Plan,

2. Identify locations for projects

3. Execute MI Projects outside TP and GP plan

3. Execute MI projects included in TP Plan

3. Execute Community MI Projects

4. Assign projects to TP and GP

4. Execute MI Projects assigned by ZP.

4. Execute MI Projects assigned by ZP and TP,

5. Development of drainage system in water logged areas.

5. Construct percolation tanks and check dams (outside GP plan). )

5. Construct percolation tanks and check dams including projects assigned by the ZP and TP

6. Sanctioning projects for percolation tanks, check dams and land leveling.

6. Supervision, monitoring and review of the progress, and quality of works by the Subject Committee.

6. Enforce inter-well distance (well density) as per prescribed norms.

7. Supervise, monitor and review of the progress and quality of works by the subject committee.

7. Coordinate between various line departments / agencies funding for MI projects.

7. Identify beneficiaries under various programmes for MI projects through Gram Sabha.

Development of MI system, drainage system, water harvesting structures and water management

8. Coordinate between various departments and agencies funding MI projects.

8. Supervise, Monitor and review progress, quality of work

Water Manage-ment

1.1.Propagate modern water management delivery methods

2. Propagate use of sprinkler and drip irrigation in drought

1. Guide and motivate people to adopt modern methods of irrigation, on- farm development and proper maintenance of field channels,

2. Select beneficiaries

1. Identify beneficiaries through Gram Sabhas for subsidized sprinkler and drip irrigation system,

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prone / water scarce area.

for subsidized sprinklers, drip irrigation equipment and delivery system and supply them, including providing technical guidance to beneficiaries,

3. Organise farm demonstration for modern water management techniques

2. Constitute Neeru Panchayats for proper utilization of water including use for drinking purposes,

3. Encourage farmers for on-farm development and development of field channels / delivery system for proper utilization of water.

Identifiy, select and approve watershed projects,

Prepare watershed project in inter-GP watersheds,

Participate in planning and implementation of watershed projects

Promote watershed development approach in all areas for better management of natural resources and environment development,

Organise people to form work committees,

Approve land/water use plan for watershed development through Grama Sabhas

Supervise, Monitor and review of the progress and quality of works by the Subject Committee

Form technical team to assist GP in the implementation of watershed projects

Assist in constituting user/Beneficiary committees in the watershed for their direct participation in the execution of the project

Integrate various beneficiary oriented and area development oriented schemes to harmonise with watershed projects

Maintain community assets created under watershed project

Watershed development

Monitoring supervision and reporting progress.

Supervise and monitor quality of works

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Coordinate between various agencies and departments implementing watershed projects such as agriculture, forestry, DPAP and DDP

Select beneficiaries and provide assistance to them for executing individual works under watershed

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ANIMAL HUSBANDRY DAIRYING AND POULTRY

Assess the need and formulate projects for the establishment, improvement and maintenance of breeding farms for cattle, sheep, goats and hatcheries.

Distribute quality breeds to beneficiaries under various programmes

Assist in identification of beneficiaries under various programmes

Development of livestock

Propagate improved breed of livestock among farmers

Motivate people to maintain quality breeds and adopt modern methods of maintaining livestock.

Establish, improve and maintain veterinary hospitals, Dispensaries, Rural Livestock Units (RLUs) and AI Centres,

Supervise the functioning of veterinary services in the TP,

Supervise the functioning of RLU and AI service centres,

Procure and supply medicines, equipment and other materials to hospitals, dispensaries, RLUs and AI Centres

Maintain mobile veterinary unit to provide veterinary care and control diseases and epidemics.

Report out-break of diseases and epidemics.

Veterinary Services

Monitor the functions of veterinary services.

Propagate production of nutritive fodder and promote proper feeding of animals,

Organise cooperatives for fodder production and provide financial assistance.

Help in establishing cooperative fodder farm.

Procure and establish fodder banks in drought areas

Supply improved variety of fodder seeds.

Allocate community land for fodder production.

Propagate modern methods of feeding to improve livestock productivity.

Control grazing and improve grazing and pasture lands.

Feeding and Fodder including support during droughts

Supply fodder during droughts.

Distribute fodder during droughts.

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Assist Dairy Development Boards or Cooperatives in the development of infrastructure for milk collection, collection centres, transportation and processing.

Develop and open new milk routes for milk collection,

Assist in organizing milk producers cooperative societies,

Promote milk producers, cooperative societies

identify beneficiaries for dairy development programme

Ensure timely payment to milk producers

Select beneficiaries under various programmes

This has to be done at GP level

Dairy Development

supply quality milch animals.

Develop infrastructure for poultry farming.

Train Poultry farmers, Identify beneficiaries for poultry farming.

Production and supply of quality chicks to poultry farmers.

Arrange for the supply of poultry feed.

Select beneficiaries and establish poultry complexes for them under various programmes.

Poultry Development

Allot or lease Community land for establishing poultry complex .

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FISHERIES

Formulate Projects for fisheries development.

Select beneficiaries for fisheries training.

Develop village pond for fisheries.

Technically appraise and approve projects for development of inland water bodies for fisheries

Organise fishermen's cooperatives.

Identify beneficiaries for assistance under various programmes and assist them in organizing fishermen's cooperatives,

Establish fish seed production farms.

Distribute boats, nets and other equipment and give assistance to cooperatives and beneficiaries.

Assist TPs in the distribution of boats, nets and other equipment.

Formulate Projects for fisheries development.

Monitor, supervise and report progress

Supervise and report progress to TPs.

Arrange training of fishermen in modern management techniques for fish production.

Lease village ponds to fishermen’s Co-operativies and groups

Execute fishpond and tank improvement projects.

Procure and supply fishing equipment for distribution among selected fishermen's cooperatives and beneficiaries.

Developing of Inland Fisheries

Monitor and supervise plan implementation.

Procure and supply motorised and modern boats and equipment to selected groups of beneficiaries and cooperatives.

Select sites for marine acquaculture and brackish water fishing

Identify beneficiaries and assist them in organising into fishermen's cooperatives.

Development of Marine fisheries.

Develop brackish water fisheries.

Organise fishermen's cooperatives.

Select Beneficiaries for assistance

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Enforce environmental restrictions on marine acquaculture and brackish fish production activities

Distribute boats and equipment to selected beneficiaries and cooperatives

Distribute boats and equipment to beneficiaries and cooperatives

Install weather forecasting and early warning system for marine fishermen.

Monitor impact of marine acquaculture on environment

Create awareness for and adopt safety measures during rough weather

Monitor the impact of Marine acquaculture on village environment and initiate impact mitigation measures

Encourage private entrepreneurs to establish processing, packaging and storage facilities,

Organise and train fishermen in processing, packaging and preservation of fish and fish products,

Development of Marketing Processing Infrastructure Assist in establishing

other marketing infrastructure

Develop tie-up arrangements between fishermen and processing units

Welfare Measures

Promote group insurance schemes for fishermen.

Implement family and group insurance schemes for fishermen.

Encourage fishermen to take up insurance schemes

Sanction relief to affected families during natural calamities.

Distribute relief to families affected by calamities

Assess loss, damage and relief requirements of families affected by calamities

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SOCIAL FORESTRY

Promote Social Forestry and Farm Forestry

Identify degraded and wastelands and formulate social forestry projects,

Identify degraded and waste lands for social and farm forestry and formulate projects with the support of the Grama Sabha,

Promote and propagate social and farm forestry for improving ecology and environment.

Implement TP social forestry projects and those assigned by ZP

Execute social forestry projects through village people,

Establish forest nurseries for supply of seedlings and saplings for distribution,

Plant trees along roads, rails and public places.

Encourage private farmers for farm forestry and assist them

Propagate fuel fodder and timber producing plants and bio-diversity,

Produce and supply seedlings and saplings for social and farm forestry projects

Distribute seedlings and saplings

Organise vana-mahotsava

Propagate fuel fodder and timber producing plants,

Organise and participate in vana mahostsava

Social forestry and Farm Forestry

Lease land to groups and individuals interested in social forestry on sharing basis.

Ensure adequate production of fuel , fodder and timber for local use.

Marketing of Fuel/Fodder and timber

Establish links for marketing of forest products

Collect, distribute and sell fuel, fodder and timber

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MINOR FOREST PRODUCE

Plan raising MFP plantation in concentrated blocks to facilitate collection and marketing.

Establish MFP nurseries for propagation of MFP species.

Assist in identification of families willing to plant MFP species

Encourage cultivation of MFP in existing forest, degraded forest lands, barren and uncultivable area, and community wastelands.

Distribute MFP seedlings for plantation.

Encourage plantation of MFP such as gum, resin, medicinal plants, aromatic plants, leaves, oil seeds, tans and dyes, grasses, seeds, canes, bamboo, etc. particularly in tribal areas.

Regeneration of MFP species

Promoting plantation of MFP species in drought prone, desert areas and under social forestry activity under JGSY, particularly in tribal areas.

Training Organise training for scientific tapping of gums, resins, and grading of MFPs

Organise training at the TP level.

Select and forward trainees names to the TP

MFP Collection, Monitor MFP collection activities in forest ranges, Timely payment of collection

Organize item wise MFP cooperatives like Tendu leaf

Organize pruning operation of Tendu trees before the leaf plucking season

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Processing, and marketing charges.

1. Set up small scale industrial units for value addition to MFPs.

2. Fix support prices for MFP procurement.

3. Establish godowns for storage of MFPs.

4. Strengthen market intelligence and market extension

1.Liaise with forest department for constitution of Joint Forest Management Committee for MFP regeneration collection, processing and marketing.

2. Ensure value addition to MFP before it leaves the forest area

1.Promote collection primary processing and value addition to MFP before selling.

2. Ensure timely payment and adequate collection charges to MFP collectors.

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SMALL SCALE INDUSTRIES INCLUDING FOOD PROCESSING INDUSTRIES

Industrial Resource potential survey

1.Formulate Projects by the DIC in coordination with KVIC/KVIB and other agencies based on Industrial Resource Potential survey.

1. Assist industrial resource potential survey.

1. Assist survey and project formulation.

Development of Infrastructure

1. Develop inter-linkages in institutions and organisations

2. Establish small industrial estates at suitable locations and develop other related infrastructure activities.

3. Identify location and develop food processing complexes.

1. Establish small rural industrial estates and complexes,

1. Identify suitable locations for rural industries.

Entrepreneur Development

1. Organise entrepreneurial Development Programmes

2. Select entrepreneurs and encourage private investments.

3. Establish industrial counseling Information and guiding centres

4. Assist entrepreneurs in formulating viable projects, and cooperative industrial project

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1. Provide information and guidance about credit facilities and other financial incentives.

1. Assist in providing financial and other help to small industries.

Credit and financial assistance from various Government Departments and Agencies

2. Coordinate credit support activities with financial institutions.

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KHADI, VILLAGE AND COTTAGE INDUSTRIES 1. Consolidate

plans prepared by TPs for Khadi, Village and Cottage industries including artisan activities.

1. Prepare plan for Khadi, Village and Cottage Industries and other artisan activities integrating schemes of other agencies such as KVIC/KVIB/ Handloom/Handicraft Development

1. Assist TP in identifying potential activities and formulation of projects.

Planning, Monitoring and Supervision

2. Monitor and supervise the overall progress in this sector, and ISB sector of SGSY

1.Establish and identify training Centres for Skill Development

1. Select beneficiaries for Training and Skill development and nominate them to training Institutes,

2. Allocate and sanction funds for Training and stipend to the trainees

2. Arrange master craftspersons

1. Identify beneficiaries for training through Gram Sabha.

3. Identify appropriate technologies and arrange for their transfer to workers

3. Pay stipend to beneficiaries and honorarium / training cost to the trainers.

Training Skill development and Transfer of technology to beneficiaries

4. Transfer and upgradation of technology in different areas of production

Infrastructure Development

1. Arrange supply of raw material, equipment, and other inputs to workers.

1. Supply of raw material, equipment and other inputs to beneficiary workers.

1. Assist in Distribution of raw material equipment, etc.

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2. Tie up arrange ments for marketing of products through Government and non-government marketing agencies

2. Coordinate programmes of various agencies for infrastructure development such as construction of common workplaces, worksheets and market complexes

2.Allow beneficiaries to use locally available raw material

3.Set up retail show rooms for products

3. Organise Cooperatives for production and marketing of products

3.Construct common worksheds/workplaces and market complexes

4. Encourage cooperatives for production and marketing of products

Credit and financial support

1. Ensure credit s upport through credit plan.

2. Monitor and supervise credit flow and financial assistance from other agencies to cooperatives and individual units.

1. Ensure credit support.

2. Assist beneficiaries in formulating project plan.

3. Arrange for subsidy and financial support under various programmes to the beneficiaries.

4. Monitor, supervise and report progress.

1. Identify beneficiaries for financial support under various programmes

2. Assist loan recovery

Credit and financial assistance from various Government Departments and Agencies

1. Provide information and guidance about credit facilities and other financial incentives.

2. Coordinate credit support activities with financial institutions.

1. Assist in providing financial and other help to small industries.

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RURAL HOUSING INCLUDING INDIRA AWAS YOJANA

Approval of TP’s plan and sanctioning of fund for rural housing schemes

1. Determine design and unit cost for guidance to GPs keeping in view technical advice and beneficiary needs

1. Assist GPs in execution of housing projects

2. Procure and supply of building materials

1. Identify beneficiaries and prepare lists through Gram Sabha.

2. Acquire land for housing layouts, {other than Ashraya housing layouts}

3. Assist in allotment and distribute housing and house sites.

4. Constitute beneficiaries committee.

5.Execute construction work.

6. Provide assistance in the distribution of building material.

Supervision and monitoring of rural housing schemes

- - Supervise construction quality, use of material and report progress.

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DRINKING WATER

Development of water supply system

1. Formulate major water supply schemes

2. Technically appraise and approve schemes proposed by TPs and GPs.

3. Award contracts for the execution of major schemes outside TP and GP plans

4.Establish water testing laboratories for control of chemical and biogenic impurities.

1.Formulate projects and seek technical approval from ZP

2. Construct schemes within the prescribed cost limits for TPs.

1.Identify schemes and locations, estimate cost and formulate projects through the involvement of Gram Sabha.

2.Construct wells, tanks and village water supply schemes of its own or as assigned by the ZP or TP

3. Periodically chlorinate open wells and treat water

4. Ensure proper distribution of water to all households in its villages.

5. Collect water sample for testing

Monitoring rural water supply schemes

1. Monitor and supervise the progress, quality of work and target achievement

1. Monitor and supervise progress and quality of works.

1. Monitor scheme implementation and report progress,

Maintenance of water supply system

Maintain drinking water schemes, collect water charges and appoint operators wherever necessary

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FUEL AND FODDER

Production of Fuel and Fodder

1. Build awareness for use of fuel- efficient devices and improved fodder species.

2. Consolidate assessments of fodder and fuel demands for the district Plan and coordinate fuel and fodder production activities

1. Identify wastelands and degraded lands for taking up fuel and fodder plantation.

1.Assess fuel and fodder requirements.

2. Select species and sites for fuel and fodder plantations

3.Identify beneficiaries for fuel and fodder demonstration plots,

4.Undertake plantation activities.

5.Maintain and protect fuel wood plantations and fodder plots in community or panchayat lands

6.Decide mechanism and oversee the distribution of fuel and fodder produced from community lots

7. Identify sites for fodder nurseries.

8.Coordinate nursery establishment programme.

9.Distribute fuel efficient wood stoves and smokeless chulhas

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ROADS, CULVERTS, BRIDGES, FERRIES, WATERWAYS AND OTHER MEANS

OF COMMUNICATION Development of road network and accessibility

1. Survey, technical feasibility, road alignment, and formulate road development projects.

2. Approve, allocate and sanction funds,

3. Assist in acquiring land, assess grant of compensation

4. Award contracts for procurement of material and equipment for construction of roads and bridges and make supplies

5. Monitor specifications of roads and bridges and supervise quality of works

1. Identify villages as per MNP norms inaccessible by all weather road and formulate projects for construction of link roads connecting more than one TP.

2. Survey, technical feasibility, sanction of funds

3. Acquire land, assess and grant compensation.

4. Construct roads using local labour without contractors.

5. Provide technical assistance for road construction projects proposed by GPs.

6. Monitor the specifications of roads and bridges and supervise of the quality of works and reporting progress to the DP.

1. Assist in formulating road construction projects and obtain approval through Gram Sabha.

2. Seek technical advice, feasibility and approval from TP engineers,

3. Allocate, approve and sanction funds.

4. Construct village link roads and village lanes through works committees, using village labour without contractors

5. Monitor and supervise quality of works through work committee and report progress to IP

Improvement and Maintenance of the existing roads / culverts and bridges

1. Conduct traffic volume survey and identify road sections needing improvement in capacity.

1. Convert TP roads into black topped roads

1. Assess costs of improvement, repair and annual maintenance of village roads.

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2. Convert ordinary district roads into blacktopped roads

3. Carry out annual repair and maintenance of roads, culverts and bridges.

4. Approve, allocate and sanction funds for all types of improvement and annual maintenance work and award contracts

5. Monitor and supervise the quality of works.

2. Undertake annual repairs and maintenance of roads, culverts and bridges

3. Approve, allocate and sanction funds for improvement and. maintenance of IP roads.

4. Monitor and supervise quality of works and report progress.

2. Raise funds through government or own sources and donations with the help of Gram Sabha

3. Execute works through work Committee

Development of waterways, ferrying. ferry services, etc.

1.Identify waterways suitable for construction of jetties for ferry services.

2.Purchase ferries and contract private operators for ferry services

3.Deepen and dredge waterways. Regulate ferry services

1.Inspect ferries and boats and maintain vigilance on services and traffic regulations.

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RURAL ELECTRIFICATION INCLUDING DISTRIBUTION OF ELECTRICITY

Expansion of electrification

1. Assess un electrified villages, hamlets and colonies and formulate projects for their electrification in coordination with KPTCL

1. Assist in obtaining power connection for poor and SC/ST /OBC families under various programmes

2. Monitor and reporting progress of energisation of irrigation pump sets

1. Find land for installing electric electrification transmission poles.

2. Maintain and operate street lights

Monitoring power supply

1. Ensure power supply for agriculture during critical periods.

2. Exercise vigilance against power theft and illegal connection

- 1.Report position during power supply prime crop season.

2.Exercise Vigilance and report against power theft and illegal connections

3.Monitor power supply for agriculture and assist in checking power theft and illegal connections

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NON.CONVENTIONAL ENERGY

Assessment of district’s energy requirement

1. Consolidate TPs plans for energy requirement and supply through non- conventional means

1. Formulate projects for use of non-conventional sources of energy in the TP

1. Assist TP in identification of potential sources of non-conventional energy devices requirement such as gobar gas, bio-mass, solar energy and wind energy

Promoting non- conventional sources of energy which includes installations of solar panels, wind mills and gobar gas plants and extension education

1. Promote non-conventional energy devices and sources,

2. Promote and popularize energy saving devices,

3. Coordinate different agencies including NGOs for promotion of alternative sources of energy

1. Procure and supply material and equipment for the projects.

2. Assist in identifying suitably locations and select individual beneficiaries for installation of community and private sources of energy.

3. Train users in the maintenance of non-conventional energy devices.

4. Monitor and supervise the operation and functioning of the projects

1. Assist in identification of beneficiary for individual biogas plants and other devices.

2. Organise beneficiary training

3. Monitor functioning of NCE devices

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POVERTY ALLEVIATION PROGRAMMES

Planning and implementation of Poverty Alleviation Programmes

1. Coordinate with other departments and agencies

2. Develop training infrastructure

3. Allocate funds for training and stipend for trainees.

4. Procure and supply quality assets, machinery and equipment for beneficiary schemes

5. Develop marketing infrastructure marketing network for SGSY self help group products

6. Prepare plan for poverty alleviation programmes at district level.

7. Assist in extending technical assistance for planning at GP and TP level.

8. Supervise and review implementation of different poverty alleviation programmes

9. Review schemes implemented in Drought Prone Areas.

10. The ZP in active cooperation with the TP and District Planning

1. Assist GPs in providing technical and managerial assistance for implementation of schemes entrusted to TPs

2. Collect and distribute data regarding development and management at the district level

3. Assist in the evaluation of schemes.

4. Release of funds to banks for subsidy adjustment, formulation of credit plans through banks

5. Prepare plans at the block level under SGSY for filling up gaps in technology, marketing tie-ups, training, strengthening infrastructure and market facilities.

6. Assist GPs in organizing self-help groups and

1. Identify beneficiaries under SGSY and other individual beneficiary oriented poverty alleviation schemes, JGSY and other employment generation programmes entrusted to GPs after approval of Grama Sabha.

2. Utilise JGSY for the development of infrastructure in the GP.

3. Assist TP for the distribution of identity cards under Employment Assurance Scheme,

4. Put up information boards about all the works taken up under Employment Assurance scheme.

5. Assist the TP in preparation of plans for land development schemes coming within TPs purview

6. Select beneficiaries in Drought Prone Areas Programme.

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Committee may arrange decentralized Planning.

11. Review and supervise schemes implemented under the grants recommended by the Central Finance Commission for local bodies

12. Review implementation of Rural Sanitation and Water Supply scheme.

13. Implement and supervise Employment.

14. Review Central Rural Sanitation Programme.

15. Plan and review Biogas plants schemes for individuals and community.

16. Undertake Planning and review of smokeless chulhas scheme and National Project on Improved Chulhas.

help groups and implement cluster strategies

7. Review plans prepared by the GPs and accord technical approval and assistance

8. Draw action plans, get technical approvals and funds allocated under land development scheme.

9. TPs can implement schemes with the help of GPs and integrate other programmes with poverty alleviation schemes

10. Assist in supervision of works under District Decentralized Plan

11. Plan and implement infrastructure development by rural local bodies.

7. Identify eligible beneficiaries under Samagra Awaas Yojana

8. Ensure proper utilization of funds of Central Finance Commission by local bodies and ensure that the scheme works permitted within GPs are completed.

Identify beneficiaries under Rural Sanitation Programme and provision of Drinking Water schemes.

10. Arrange live demonstration under smokeless chulhas scheme and identification of beneficiaries under National Project on Improved Chulhas and Sanitation Programme.

11. Undertake the national project on improved Chulhas and Sanitation.

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12. Plan and implement Integrated Rural Sanitation and Water Supply Scheme.

13. Arrange practical demonstration under smokeless chulhas scheme

Wage Employment programmes

1.Prepare ZP level shelf of projects and desegregate it into plans that can be implemented by TP and GP plans.

2.Formulate projects outside TP and GP

3.Assign projects to TPs, GPs, NGOs and various other agencies and departments for execution.

4.Approve, sanction and release funds to TPs, GPs and other organizations for the execution of ZP projects.

5.Release funds to TPs as per prescribed norms

6.Provide funds for maintenance of assets created under JGSY / EAS etc.

7.Inspect muster rolls and check quality of works and wage

1. Formulate projects with TP funds,

2. Scrutinise and grant technical approval to GP Projects.

3. Procure and supply material for projects.

4. Technically assist GPs for executing projects.

5. Execute projects outside GPs plans.

6. Inspect muster rolls, quality of work, assets created and mandays generated by projects executed by IP and GPs.

1. Assist in identification of labourers in the village requiring wage employment through Gram Sabha, list them and provide employment cards to beneficiaries.

2. Formulate projects and get approval through Gram Sabha and seek technical approval from TP.

3. Constitute works committee for execution of works and projects.

4. Ensure employment to all in the village

5. Distribute projects and works as per norms

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material ratio as per guidelines,

8.Monitor and supervise progress of programmes.

9. Submit quarterly returns and utilization certificates to GOI and State Government for release of next instalments.

and GPs.

6. Monitor and supervise quality of works, assets created and mandays generated.

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EDUCATION INCLUDING PRIMARY AND SECONDARY SCHOOLS

Expansion and development of educational facilities.

1. Assess the requirements of schools, teachers, equipment, etc. in the district and plan for them.

2. Supervise and monitor quality of educational services.

.

1. Supervise the functioning of primary and upper primary schools

2. Maintain school buildings and related infrastructure.

3. Supply and distribute material and equipment to schools.

1. Ensure full enrollment of school age children

2. Maintain school buildings, and play grounds,

3. Exercise vigilance on regular attendance of teachers and students and report to the concerned.

4. Campaign for full enrollment and reduction of dropouts

5. Assess the drop out position and initiate appropriate action to reduce it.

Establishment and maintenance of hostels, and other welfare measures for target group students.

1. Assess and plan hostel requirements for target group students

2. Maintain hostels.

3. Supply school uniforms and books for target group students.

1. Distribute school uniforms, books and other materials to target group students.

2. Assist in the maintenance of hostels,

1. Assist TPs in the distribution of study material to target group students.

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TECHNICAL TRAINING AND VOCATIONAL EDUCATION

Establishment and maintenance of ITIs

1. Establish and maintain ITIs

2. Assess and plan for technical training

3. Assess vocational education needs

4. Supervise and monitor functioning of ITIs

1. Conduct aptitude tests for selection of students under various trades

2. Recommend for admission and placement in ITIs

-

Promotion and identifying suitable courses for vocational according to the needs and potential of different areas in education

1. Select courses for vocational education and identify education schools and centres for important courses

2. Motivate students for vocational training

1. Assist in the promotion of vocational education in schools and centres

2. Select candidates and students for vocational courses

1. Assist in identification and recommend eligible candidates for vocational education and training

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ADULT AND NON-FORMAL EDUCATION

Planning and implementation of adult and non-formal education Total Literacy Campaign

1. Identify suitable locations for establishing adult education centres.

2. Select volunteers and supervisors for teaching and maintenance of centres

3. Procure and supply all relevant infrastructure and educational material to centres.

4. Supervise and monitor activities of adult education centres

5. Organise total literacy campaign

1. Implement Adult and non-formal education programmes and total literacy campaigns

2. Distribute material to the centres

1. Help in mobilising people for participation in Adult education and TLC campaigns

2. Supervise and assist in functioning of centres and ensure regularity of learners and volunteers.

3. Supervise and monitor functioning of the centers

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LIBRARIES

Establishment and maintenance of libraries

1. Plan for establishment of new libraries and maintain and improve existing ones

2. Procure and supply books, reading material and popular literature

1. Assist in the maintenance and functioning of libraries

1. Establish and maintain libraries

2. Up-keep of library

3. Raise donations and collect books for library

4. Subscribe to vernacular news papers and magazines

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CULTURAL ACTIVITIES

Promotion of Cultural activities

1.Guide, encourage and organise cultural programmes 2. Utilise available popular media for cultural affairs 3. Organise youth festivals, sports events on dates of national and state importance 4. Establish sports complexes, theatres and other infrastructure 5.Identify and mobilise sponsors for cultural and sports events and youth festivals 6. Maintain and supervise the functioning of Nehru Yuvak Kendras

1. Organise local festivals with the help of GPs 2. Plan and organise sports and cultural meets with the help of local organisations and voluntary efforts

1. Organise sports festivals and cultural events in villages using folk media for strengthening of national integration, family planning campaign, literacy, sanitation, etc.

2. To promote sports and organize youth clubs

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MARKETS AND FAIRS

Identification of location and development of market yards

1. Identify locations and develop marketing yards and infrastructure for marketing rural products and formulating projects.

1. Develop and maintain agricultural market yards,

2. Develop and maintain places for fairs/shandies and weekly markets

1. Maintain village fairs and weekly markets,

2. Construct market complex within the GP.

Regulating wholesale and retail markets, supervision and monitoring of marketing activities

1. Assist in Regulating wholesale and retail markets

2. Supervise and monitor marketing activities

3. Supervise District service and marketing societies

1. Enforce fair trade practices and maintain quality of commodities

2. Assist in the maintenance of statistics on prices and commodity traded

3. Maintain statistics on prices and commodities transacted within the district.

-

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HEALTH AND SANITATION, INCLUDING HOSPITALS, PRIMARY HEALTH

CENTRES AND DISPENSARIES Health care 1. Plan through

health committees to provide physical infrastructure

2. Coordinate communicable diseases programme with the State

3. Coordinate construction and maintenance and supervise of PHCs

4. Maintain district ISM (Indian System of Medicine) hospitals

5. Periodically conduct Epidemiological surveys

6. Promote school health programmes

7. Organise health awareness rallies and camps

1. Assist in supervision and maintenance of sub-centres and deployment of field staff

2. Supervise mid-day meals schemes for school children

3. Organise health and family welfare camps and conduct demonstration- cum-exhibition programmes on, health, family welfare and sanitation.

4. Assist in supervision of Indian Systems of Medicine (ISM) dispensaries.

1. Assist in formation of village health committees comprising Panchayat members, representatives of villagers, village health guide (VHG) Trained Birth Assistant (TBA) and Multi-purpose Health Workers

2. Upkeep of village sanitation, cleaning of roads and drainage

3. Mobilise and organise people for health and family planning and immunisation camps.

4. Coordinate and supervise construction of sanitary latrines

Sanitation 1. Plan rural sanitation programmes

2. Promote Information, Education and Communication (IEC) campaigns

1. Organise and supervise sanitary marts.

2. Formulate plan for assisting in the construction of sanitary latrines.

3. Assist in inspection /assessment of

1. Chlorinate village tanks and wells and spraying of DDT .

2. Assist in construction of individual sanitary latrines

3. Report of outbreak of

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quality of public health inputs and services.

epidemics

4. Assist in coordinating emergency medical relief services

FAMILY WELFARE Maternal and Child Health (MCH) Centres

1. Plan for Fam Wel prog

2. Establish and maintain MCHs.

3. Supply medicines and equipment to MCHs

4. Train mid-wives and para medical functionaries

5. Coordinate with state/international agencies

6. Provide immunisation services

7. Propagate family planning methods, procure supply and distribute contraceptives

8. Organise family planning and immunisation camps

9. Identify and approve NGOs for FW

1. Distribute medicines, equipment and family planning materials to centres.

2. Propagate and create awareness about maternal and child care immunization and family planning schemes.

3. Coordinate and assist in monitoring and supervision of family welfare and family planning services

4. Assist in organising family planning and immunisation camps

5. Organise IEC Health and FW promotional campaigns Distribute materials, medicines and equipment to ICDS Promote school health programme centres. Assist

1. Assist in propagation of maternal child care, family planning and immunisation programmes

2. Assist in identification and recommendation of beneficiaries for maternity aid under NSAP and related schemes

3. Assist in maintenance and supervision of Anganwadies

4. Identify beneficiary mothers and children

5. Supervise the activities of ANMs and Anganwadi workers

6. Collect vital statistics (e.g. births, deaths etc.)

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FW

10. Organise IEC/Health and FW promotional campaigns.

11. Promote school Health Programmes.

12. Plan supervise and monitor ICDS

13. Procure, supply and distribute meals for children, medicines and equipment for ICDS centres.

14. Train ANMs and others

15. Laise with State/ National level health programmes

beneficiaries, mothers and children.

6. Distribute materials, medicines and equipment to ICDS Promote school health programme centres.

7. Assist beneficiaries, mothers and children.

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WOMEN AND CHILD DEVELOPMENT

Socio economic development of women

1.Promote equal opportunity to women in all sectors of development -social economic and political.

2.Mobilise social support against social evils like dowry, sex determination, gender biases like killing girl child at birth, discrimination in educating girl child, etc.

3.Promote opportunities for women to engage themselves in income generating activities.

4.Protect the interests of women workers in the unorganised sector.

5.Ensure payment of minimum wages to women agricultural labourers.

1. Propagate the message of equal opportunity to women in all sectors of development

2. Mobilise social support against social evils that discriminate against women.

3. Identify income generating activities for women

1. Generate awareness among women about their rights.

2. Promote self-help groups of women

Maternity benefit 1. Help pregnant women receive maternity benefits under the National Maternity Benefit Scheme.

1. Generate awareness among women about maternity benefit scheme, proper age of marriage and small family norm

1. Identify pregnant women eligible for maternity benefit scheme, and help them in getting benefits.

Development of Women and Children in Rural Areas (DWCRA)

1. Supervise, guide and support district level officials concerned with the

1. Prepare annual action plan

2. Assist ZP & GP

1.Assist in development of data base for women and child development

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Areas (DWCRA)

implementation of DWCRA programme

2.Prepare district annual action plan through consolidation and aggregation of village and block level plans.

3. Appraise resources and conduct market surveys to identify demand based income-generating activities.

4. Prepare annual action plan for DWCRA in line with the credit plan

5. Ascertain the availability of funds for women and child welfare

6. Identify active NGOs for the implementation of the Programme

7. Ensure coordination in converging services.

8. Set up infrastructure facilities in support of the programme.

in organizing training programmes, workshops and meetings.

3.Ensure convergence of services in coordination with other departments at GP level

4. Mobilise and organise women through NGOs for implementation of programmes

programmes.

2.Prepare annual action plan

3.Assist ZP and TP in identification of women beneficiaries

4.Assist in identification and selection of demand based income-generating activities for women groups.

5.Assist in conducting credit camps to provide access to credit for women groups from financial institutions.

6.Assist in organizing self help/thrift and credit groups as an entry point to the programme.

7.Assist in conducting training programmes in

a. awareness building

b. gender sensitization

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c.leadership and

d.skill development

(TRYSEM)

8.Maintain infrastructure facilities like drinking water, sanitation, anganwadi centers primary schools, common worksheds and provide accommodation for front line workers.

9.Assist in ensuring convergence of services to women groups; literacy, health, immunisation and family welfare.

10.Assist women groups in procuring raw materials

Integrated Child Development

1.Supervise, guide and support Services (ICDS) for implementation of ICDS projects

2.Monitor functioning of the Scheme in the district

3.Promote people's participation in programmes through involvement of local leadership.

1.Supervise project staff of women and child welfare department

2.Assist officers concerned with the programme in procurement and distribution of nutrition material and other medical supplies.

3.Provide infrastructural facilities and other

1.Assist ICDS staff in TPs in conducting surveys

2.Assist in selection of beneficiaries

3.Assist in selection of sites for locating Anganwadi centers

4.Ensure community participation through organizing regular meetings

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leadership.

4.Coordinate with the District Collector for elimination of child labour.

logistic support to facilitate implementation of the programme

4.Identify child labour working in hazardous and other occupations

5.Construct Anganwadi Centres in GPs

5. Involve women GP members in supervising the functioning of Anganwadi centres particularly while ensuring attendance in the center, maintenance of cleanliness and hygiene, supplementary nutrition in terms of dietary schedule and timings, proper child care and meeting of educational needs, regular health check up and immunization

6. Assist in the distribution of nutrition and conduct of regular health check-up

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SOCIAL WELFARE, INCLUDING WELFARE OF THE HANDICAPPED AND

MENTALLY RETARDED

Welfare of the Disabled

1.Survey and classify disabled persons according to the nature of disability.

2.Make available text books in Braille to visually handicapped children in the schools.

3.Facilitate easy access to and mobility with buildings and public places for persons with disability especially for people on wheel chair and persons with visual disabilities.

4.Inspect, supervise and monitor voluntary organisations receiving grant-in-aid from the Ministry of Welfare GOI for rehabilitation of persons with disability

5.Identify and promote voluntary organs receiving grant –in-aid from the Minof Welf, Govt. of India for

1.Identify disabled persons and coordinate with ZPs for their rehabilitation

Assist in identification of disabled persons and coordinate with Block and Zilla Panchayats for their rehabilitation.

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rehabilitation of leprosy patients.

6. Identify voluntary organisations and assist them to set up Special Schools for disabled persons with Grant-in-aid from the Ministry of Welfare.

7. Coordinate with organisations and government in getting assistance for purchase of aids and appliances for disabled persons.

8.Coordinate with Special Employment Exchanges and Vocational Rehabilitation Centres for assisting disabled persons to secure employment

9.Coordinate with District Rehabilitation Centres for providing rehabilitation services to disabled persons.

10.Organise Sports Meet and Cultural Programmes for people with disabilities.

Street Children 1.Identify street children suffering

1.Identify street children and

1.Assist in identification of

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from destitution, neglect, abuse and exploitation and help them in getting integrated community based non-Institutional basic services through voluntary organisations who get grant-in- aid from Ministry of Welfare, Government of India.

coordinate with the ZP for their development

street children Coordinate with the TP and ZP for rehabilitation and development

Adoption of Children

1. Identify voluntary organizations which deal with the adoption of destitute, abandoned, orphaned and relinquished children by giving the child for growth and development to parents other than the child's biological parents, and help in the adoption of orphaned children.

1.Identify parents willing to adopt children and coordinate with the District Panchayat for their growth and development

1.Assist in identification of parents willing to adopt children and coordinate with the TP and ZP for their growth and development.

Welfare of the Aged 1. Identify destitute and aged persons and help them in taking shelter in voluntary organisations which receive grant-in-aids from the Ministry of Welfare State Governments for running Old Age

1.Identify the aged and coordinate with the ZP for their maintenance, and giving old age pension.

1.Assist in identification of the aged and coordinate with the ZP and TP for their maintenance and giving old age pension.

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Homes; and for giving old age pension

Drug use Prevention 1.Build awareness and educate people about ill-effects of drug abuse and prevent it

2.Assist drug addicts through a well rounded up programme of motivation, counseling, treatment, follow up and social reintegration of cured drug addicts at Counseling Centres for drug addicts run by voluntary organisations for which they get grant in-aid from the Welfare Ministry

3.Take drug addicts to counseling, de-addiction and after care centres, deaddiction and awareness generating camps for their rehabilitation

1.Build awareness and educate people about ill-effects of drug abuse and prevent it

2.Coordinate with the ZP for their rehabilitation

3.Take drug addicts to counseling, de-addiction and after care centres, deaddiction and awareness generating camps for their rehabilitation

1.Assist in building awareness and educating people about ill effects of drug abuse and prevent it.

2.Coordinate with the ZP and TP for the rehabilitation of drug addicts

3.Take drug addicts to counseling, de-addiction and after care centres, deaddiction and awareness generating camps for their rehabilitation