governance, political economy, institutional development and economic regulation

Posts tagged ‘Lt. Governor’

CM Kejriwal’s plunging popularity

Kejriwal plunge

(photo credit: fundamental.bogs.com)

How justified is Mr. Kejriwal, the Chief Minister (CM) of Delhi in assuring auto rickshaw (tuk tuks) owners and drivers -his niche supporters numbering around 100,000 – annual rate revisions in tandem with rising costs, when he denies a similarly supportive regulatory regime to the three private companies which supply power to consumers in Delhi?

As a Dilli-walla, who has not had to use an inverter during the last five years because electricity is available on tap- a saving of Rs. 5000 per year- it seems obvious to me that privatizing electricity supply has been the biggest boon for citizens.

But to sustain supply at a reliability level of 99.5%, the DISCOMS have to buy sufficient power to meet peak load and maintain the wires, related transmission and distribution equipment and meters sufficiently well, to avoid breakdowns and to meter consumption accurately. Privatisation has given Delhi what only Bombay (also privately supplied) used to have a two decades ago – reliable electric supply.

Build institutions, don’t undermine existing ones

The Delhi Electricity Regulatory Commission’s (DERC) consistently fair, participative and effective decision making has supported this achievement. Not surprisingly, a recent independent survey, done by the premier Jaipur based, consumer advocacy institute- CUTS, which reviewed institutional arrangements and consumer perception, assessed the DERC as the state electricity regulator most responsive to citizen grievances.

It is consequently, decidedly odd, that the Mr. Kejriwal should try and undermine the institutional credibility of the electricity regulator by insinuating that the private DISCOMS are being favoured by the DERC tariff determination process at the cost of consumers.

Most recently Mr. Kejriwal has alleged that the newly appointed in-charge Chief Secretary (who apparently was not his choice) is also in cahoots with the two Reliance power DISCOMS.

Mr. Kejriwal has erred in mixing up the issue of whether or not the CM should choose the Chief Secretary with the unrelated issue of whether, or not, the person appointed to that position, by the Lt. Governor, has the right credentials to occupy that post.

On the first issue, good governance norms would dictate that, at the very least, the CM should be consulted and preferably should concur in the appointment of the Chief Secretary (CS). After all, unless the CM and the CS trust each other, government will become dysfunctional. The worst thing for a government is to admit publicly that it is out of control. This holds irrespective of the legal position that the Lt. Governor is not bound to seek the CMs advice on the issue since Delhi is only a “make believe” State Government with limited functions.

Populism is not sustainable

The Kejriwal government is coming across as populist, anti-reform and anti-organised private sector. Add to this the constraint that being recent rulers, with no administrative experience, it appears ham-handed at doing what it wants. The result is that even good intentions get warped by inept execution.

Why Messers Kejriwal and Sisodia seem bent upon wasting time and political capital on burnishing their populist image, even though there are still more than four long years to go before elections, is puzzling.

That Mr. Kejriwal looks to the common man for his support is welcome. After all more than 40% of Delhi residents live either in slums or in slum-like colonies. But more than “freebies”- like cheap power and free water- what each of these “slum dwellers” want is a better life for their children and a job.

Generating new jobs

Generating 1 million “good” jobs in Delhi over the next four years is a colossal task and the CM would do well to focus his energies on this task. He will need the active collaboration of the private sector to achieve this goal. The continued availability of reasonably priced, good quality electricity will be crucial so tinkering with what is working well (privatized electricity utilities) is dangerous and irresponsible.

It is all very well to grandstand by dis-allowing the entry of multi-brand retail in Delhi. In any case, these space-intensive, “deep pocket” entities which seek to provide a “complete shopping experience”, would rather locate in adjoing NOIDA or Gurgaon, where commercial space is cheaper. But what does the government plan to do to “clean up” the existing local market places and make small shopkeepers more competitive?

Why not create new jobs by servicing public spaces better with private security; better maintenance; toilets; take-a-break-spots; green spaces and parking facilities to enhance the shopping experience.  The popular Dilli Haat (market) started two decades ago is one such example.

Make the rich pay for using public road space

Delhi has around 2 million cars. Most of them are parked overnight on the streets and adjoining side-walks. Why not charge car owners for this privilege, especially at a progressive rate? Rate progression would mean that for every incremental car per household, the rate increases. Even a flat charge per car of Rs 500 per month would yield an additional revenue of Rs 1000 crore per year (rule-of-thumb basis) equal to 3% of the 2015-16 Budget estimate of Rs 35,000 crores.

The incremental proceeds could be used, in the colony where it is collected, to provide and maintain colony roads; drains; sewage systems; street lights and water supply systems. More importantly, the fee will provide a disincentive to own multiple cars; encourage owners to dump old, unused cars and free up public parking, cycling and walking space.

Public transport

The CM should also note that whilst today electricity in Delhi is of the same quality as in Mumbai, the same cannot be said of the public buses. Ensuring a 24X7 public transport system, which is secure and accessible within a maximum ten minute walk from any urban mohallah (community), is an enormous challenge which goes beyond just buying more buses. Meeting this public transport infrastructure gap will hurt he CMs support group the most – the 100,000 auto rickshaws who provide an inefficient, insecure and costly substitute for public buses. But it can garner the CM the support of 60% of the 25 million Dilli-wallas who can only afford to travel by bus.

There are still more than four years to go for the Delhi elections and it is sad to see the Kejriwal government not using this time to deliver substantial gains to Delhi citizens. Grandstanding by “taking on” the Government of India via the Lt. Governor is unlikely to get it votes. Delhi is not a city which tolerates “whiners”.

BJP ruled municipalities provide no “benchmark” competition

The only silver lining for Mr. Kejriwal is that the three Municipal Corporations, all controlled by the BJP, are even worse. It is shocking that the Modi “magic” has not brushed-off on its local worthies and the municipalities remain mired in inefficiency and corruption.

Far from setting governance standards which would force Mr. Kejriwal to up his game and perform better, the Delhi municipalities are making it absurdly easy for Mr. Kejriwal to “shine” by comparison. This is shortsighted of the BJP and bad for Delhi citizens.

End game

Mr. Kejriwal has already lost the support of the middle class. Sadly he is in danger of losing the poor also, unless he takes service delivery beyond the level of rhetoric. He knew the limited character of the Delhi government before he contested. If he now feels constrained for power he has to wait till 2017 when he will get a chance of consolidating his power base in the three municipalities. Alternatively, he has to wait till 2019 in the hope of getting a congenial partner at the national level, who will cede fuller powers to Delhi State.

Either way he has a clear three years in which he can focus on improving what lies squarely within his ambit today- electricity supply, roads, public lighting, water, drains, sewage collection and treatment and social services. Even this seems a handful given the shallow bench strength of the AAP.

AAP can’t buck the muck

Delhi voters are in search of a government. The BJP only has 32 and can at best reach 34 with the two “others” elected. To go further and get 36 it needs to break off two-thirds of the Congress or the Aam Admi Party (AAP) MLAs. Neither option seems viable.

The AAP has been offered support from the Congress. With its 28 MLAs and 8 from the Congress, it can form a government. In fact it is duty bound to do so and has no choice in the matter.

Kejriwal’s dictat that the AAP will form a government only if it is in majority and shall not seek support from any other party, runs completely against the grain of parliamentary democracy.

Forming a government is a duty of political parties which either have the numbers or can coalesce to get them. It is not an option.

To extend this absurdity further, imagine if even a majority party should choose to sit in the opposition on the grounds that it is not “ready” to run a government or too busy fighting elections elsewhere to dirty its hands with governance in Delhi. Where does it leave citizens and their supporters? Did they press the AAP button by mistake instead of the NOTA button?

It now becomes incumbent on the Lt. Governor of Delhi (LG) to ask the AAP to form the government since BJP, neither has the numbers, nor can it get additional support. The interesting issue is what the LG should do in case AAP refuses or pleads lack of numbers. How should the LG treat the offer of support to the AAP from the Congress?

The LG can break new grounds by “requiring” the AAP to form the government on the back of the Congress promise of support. This will bring a degree of responsibility into electoral practices. A party must not be allowed to escape the consequences of its public actions or destroy the very fabric of representative democracy, by casually spurning the mandate to govern.

Are there sanctions which could apply in case AAP refuses to govern? Should the Election Commission withhold recognition on grounds of the frivolous approach of the AAP to governance?

The Delhi conundrum is exactly what is sought to be avoided in other systems, where a runoff between the two candidates getting the largest vote share is prescribed, till one of them gets a clear majority. We don’t have that useful system in India, precisely with the intention of not disadvantaging new parties or those with less than majority support, since their electability is low. This positive feature of our electoral system should not translate into a potential political vacuum.  

Even purely strategically, it boggles the mind as to why AAP should refuse an offer of support, from the Congress, to form the government. Accepting unconditional support from any party cannot reduce the “clean image” of the AAP. What is far more important than merely forming a government is running it cleanly and here the AAP would have a free hand.

The AAP can go ahead and form its Council of Ministers and Kejriwal can realize Anna’s recent prediction of becoming CM. Thereafter, they will face the challenge of passing the Annual Budget. They could formulate the kind of budget which they have promised, using the best brains in the business and they are not likely to be short of support on this ground.

If the budget is sensibly formulated, the Congress will find it very difficult to withdraw support. Wilful withdrawal of support will injure the credibility of the Congress and build the credibility of the AAP. Even just going through the exercise of formulating the budget is likely to be highly productive for the AAP and will build its capacity, as a party.

Kejriwal’s knee jerk rejection of Congress support needs to be reviewed. The LG, is known for his congeniality and diplomatic skills, and hopefully shall be able to convince Kejriwal that the interest of Delhi and the AAP, as a political party, lies in getting into the muck of governance.

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