Islamabad Local Government

Islamabad Capital Territory Local

Government Act,2015

M.Waseem Sajjad (MWS)

M.Phil. Public Policy

PIDE School of Public Policy

[email protected]

15 April 2016

Table of Content

ICT Profile 1

Historical Perspective 2

Legal Framework under ICT 3

Local Government Election and Administration 4

Local Government finance and Taxation 5

1st and 2nd generation theory and ICT LG 2015 6

7 Critical Analysis

8 Conclusion

ICT Profile and Historical Perspective

Historical Perspective

New capital established at Islamabad on Feb 24th, 1960

Part of Rawalpindi administration till June 1980

Administrative functions assumed by Federal Government vide Presidential

Order 18 of 1980 promulgated on January 1st, 1980.

Administrator (later re-designated as Chief Commissioner) created.

CDA operating under CDA Ordinance, 1960

EXISTING MUNICIPAL DIVISION

Municipal Area under

CDA Area under 12 Ucs

under ICT LGO 1979

4/19/2016 5

Islamabad Capital Territory

Rural Area: 44% of Total ICT Area (=906 Sq.Km)

Area of ICT: Total 906 sq Km

Population: Total 1.4 M (Estimated)

1998 Census: 805,235

Existing UCs (in Rural ICT only)

under LGO 1979 : 12

Total Villages in ICT : 133

LEGAL FRAMEWORK FOR ESTABLISHMENT

OF LOCAL GOVERNMENT SYSTEM UNDER PROPOSED ICT LG BILL 2015

LEGAL FRAMEWORK UNDER ICT LG

There shall be no Rural-Urban Divide and the operations shall extend to whole

of ICT

A two-tier system with a Metropolitan Corporation and Union Councils

Bill envisages party based elections – S.26 (I)(k) states as follows:

26. Disqualifications for candidates and elected members. — (1) A

person shall be disqualified from being elected or chosen as, and from being, an elected member

of a local government, if he-

…

(k) has used for his election the platform, flag, symbol, affiliation and financial

or material resources or support of a political, religious, ethnic or sectarian party or

organization.

LEGAL FRAMEWORK UNDER ICT LG BILL

Election Commission of Pakistan has delimited Union Councils in line with the

directions of Honorable Supreme Court of its order dated 20.03.2014.

Section 6 of the ICT LG Bill, 2015 as passed by National Assembly and pending

assent of Senate of Pakistan, requires the Government* to determine the

number of Union Councils in Islamabad Capital Territory.

Section 15-A of the CDA Ordinance shall be repealed thus devolving municipal

functions, exercised by CDA, to the local governments

* Government means Federal Government under section 2(s) of ICT LG Bill, 2015

LG ADMINISTRATION

Local Governments shall not exercise the executive authority of

the F.G.

Overall Master plan (planning function) of ICT will be held only

with by CDA.

Anything not covered under this act shall be done by LG or

otherwise Government.

Jurisdictions between two UC’s could be requested to F.G.

Required two-third majority of total membership of each UC to change.

Not quitting revenue estate functions in each UC.

There shall be no Rural-Urban Divide and the operations shall extend to whole of ICT.


A UC shall be a:

– Territorial area.

– Shall not cross boundaries of Metropolitan Corporation.

– Uniform population.

There shall be a LG Consisting of:

– Metropolitan Corporation for ICT and;

– Union Councils for ICT.


A UC shall be a:

– Territorial area.

– Shall not cross boundaries of Metropolitan Corporation.

– Uniform population.

There shall be a LG Consisting of:

– Metropolitan Corporation for ICT and;

– Union Councils for ICT.

LEGAL FRAMEWORK UNDER ICT LG BILL

Election Commission of Pakistan to delimit Union Councils in line

with the directions of Honorable Supreme Court of its order

dated 20.03.2014.

Section 15-A of the CDA Ordinance shall be repealed thus

devolving municipal functions, exercised by CDA, to the local

governments.

The members of Metropolitan Corporation shall elect as joint

candidates from amongst the members of Metropolitan

Corporation, the Mayor and Deputy Mayor. (For first session)

Bill envisages party based elections.

STRUCTURE OF LOCAL GOVERNMENT

The Union Council shall consist of Chairman and members:

– Six general members

– Two women

– One peasant/worker

– One youth member

– One Non-muslim

The entire Union Council shall be the constituency for the election of all members

(including reserved seats).

Chairman would provide leadership for budgeting, annual dev. plans, issue executive

order to Union Secretaries etc.

STRUCTURE OF LOCAL GOVERNMENT

The Metropolitan Corporation shall consist of Chairmen of all Union

Councils and shall include members on following reserved seats:

– Women

– Peasants / Workers

– Non-Muslims

– Youth

– Technocrats

The number of women should not be less than 33 percent, peasants/workers not less

than 5 per cent, non-Muslims not less than 5 per cent, youth not less 5 per cent

each and technocrat not less than 2 per cent. ”

LOCAL GOVERNMENT ELECTIONS

The elections shall be based on Adult franchise, through a secret ballot in the

prescribed manner, whereby the electoral rolls shall be provided by the

Election Commission which is responsible for conduct of elections

The requirements for a candidate include 25 years of age, citizen of Pakistan

and enrolled as voter in the electoral rolls of the respective Union Council

The term of the Local Government shall be FIVE years from the date of its first

meeting and the Mayor or Deputy Mayor may be removed from office by Two-

Third majority of the members

A Mayor, or Deputy Mayor shall cease the office if vote of no

confidence is passed against them with two third majority.

– Shall not be moved before one year the date of assumption of charge.

– If unachieved, shall not be re-moved before one year.

Every election or removal of a member shall be notified by the

ECP.

FUNCTIONS UNION COUNCILS

Chief officer shall ensure coordination between M.C and UC’s in the ICT.

For U.C, the Chairman of the Union Council shall be the C.A.O.

CAO shall assure that M.C is adhered to laws.

The Govt. may further devolve any of its functions.

A LG shall hold at least one meeting during a month.

Metropolitan Corporation

Islamabad Metropolitan Corporation

FUNCTIONS OF METROPOLITAN CORPORATION

Functions of Metropolitan Corporation are subject to the provisions of CDA

Ordinance 1960 and ICT Zoning Regulations 1992

The Government may assign any of the functions, of Metropolitan Corporation,

to any authority constituted under a statute or to any public or private company

The Deputy Mayor, and in case there are more than one Deputy Mayor, the

Deputy Mayor who is senior in age, shall perform the functions of the Mayor if

the Mayor is unable to perform his functions on account of absence or for any

other reason.

The Mayor Shall

Present budget and tax proposal

Recommend implementation way

Provide Vision and Direction

Develop criteria---KPI

Devise mechanism for accountability

Recommend Strategies and

program to address prioritized need

The Mayor Duties

Review the performance of MC in order to

improve

Economy, effeciency and effectiveness

Efficiency of revenue collection services

Implementation of the bye-laws Oversee formulation and execution Of the annual development plan

Chief officer: roles and responsibilities

Chief Officer, appointed by Government, shall be the Principal Accounting Officer and shall ensure adherence to all laws, rules, regulations and policies and shall be responsible for

Coordination

internal audit

human resource management

public relations

legal affairs

emergency services

Local Government Finance

A local government shall establish a Local fund to which taxes, tolls, fees, rates,

grants by Government, rents and profits, fines/penalties and proceeds from

investments shall be credited and expenditure shall be incurred for repayment

of loan, to satisfy a judgment, for conduct of elections or any other charge as

specified shall be charged upon the local fund

The Auditor-General shall audit the accounts of local government and the Audit

report of the Auditor-General shall be considered by the Public Accounts

Committee of the National Assembly

Local Government Finance

Charged expenditure.— (1) The following expenditure shall be charged

upon the Local Fund:

(a) the money required for repayment of loans;

(b) the money required to satisfy any judgment, decree or award against

the local government;

(c) the money that the local government may be required by the

Government to contribute towards the conduct of local government

elections and other deferred liabilities of the local government.

Local Government Budget

Budget.— (1) The annual budget for a local government shall contain estimates of:

(a) grants from the Government;

(b) amounts available in the Local Fund

(c) receipts for the next year

(d)expenditure to be incurred for the next year.

(2) The Government shall notify the provisional share

(3) The functionaries of a local government may re-appropriate budget and revised budget shall be submitted to the local government for approval.

Local Government Budget

(4) A demand for a grant shall not be made except on the recommendation of the

Mayor or the Chairman.

(5) Conditional grants shown separately in the budget and shall be governed by

the conditions on which such grants were made.

(6) A local government shall prepare the budget in the prescribed manner and in

accordance with the chart of accounts notified by the Auditor-General of Pakistan.

Honoraria and allowances.— A local government may, subject to the prescribed

limitations, make budgetary provisions for honoraria and allowances of the

Mayor, Chairman, Deputy Mayor, Vice Chairman or a member of the local

government.

Audit and LG Debts

Audit.— The Auditor-General shall audit the accounts of a local government in the form and manner as may be deemed appropriate.

Local government debt.— (1) A local government shall not incur any debt without previous approval of the Government. (2) A local government may invest surplus funds, if any, in such securities and financial institutions, as may be approved by the Government.

LOCAL GOVERNMENT TAXATION

Taxes to be levied.— (1) Subject to this Act, a local government may, by notification, levy any tax, fee, rate, rent, toll, charge or surcharge specified in Fourth Schedule.

A local government shall not levy a tax without previous publication of the tax proposal and inviting and hearing public objections.

A local government may, subject to provision of subsection (1), increase, reduce, suspend, abolish or exempt any tax. Property tax.— The property tax, under this Act, shall be collected by Metropolitan Corporation.

The Tax collected under this section shall be distributed amongst the Metropolitan Corporation and Union Councils in such a ratio as the Government may, by notification, specify.

LOCAL GOVERNMENT TAXATION

Collection of taxes.—A tax or fee levied shall be collected in the prescribed manner. (2) The Government may prescribe the mode of collection of a tax or a fee levied under this Act. (3) requested by the local government, the Government shall recover the tax, fee or other money as arrears of land revenue. (4) The recovery of tax, fee or other money under sub-section (3) shall not absolve the person from prosecution of any offence under this Act or any other law.

Additional powers of the Government.— the Government may, by rules, determine the minimum rate of a tax or fee to be levied and collected by a local government. (2) The Government may, exempt the levy of any tax or fee of a local government for a specified period of not more than fifteen days on any special occasion or in order to alleviate the specific hardship suffered by people at large or a section of people.

General Power of Local government

No.

Responsibility

No.

Responsibility

1 Animal 9 Development Planning

2 Boundaries and trees 10 Public Health and Sanitation

3 Burial Places/Graveyard and Cremation 11 Public Safety

4 Culture 12 Registration of Births, Deaths, Marriage and

Divorce

5 Dangerous and Offensive Articles and

Trade

13 Social Welfare and Community Development

6 Drainage and Sewerage 14 Streets and streets lighting

7 Food and Market 15 Trades and occupations

8 Licensing 16 Public Vehicles and Parking

17 Water Supply

Taxes and Levies

N0. Metropolitan corporation Union Council

1 Water Rate Taxes

2 Drainage rate Entertainment tax

3 conservancy rate Birth and Marriage registration fee

4 fee of construction fee on UC service

5 land changing fee Fee of Public utility i.e. drainage, water etc.

6 licenses fee community tax

7 slaughter house fee fee for licensing of professions and vocation

8 tax on profession, trade any other tax/levy authorized by the government

9 market fee

10 tax on sale of animal

11 toll tax

12 fair and industrial show fee

13 parking fee

Core 1st Generation Approaches to FD and ICT LG Act. 2015

Service delivery

responsibility

• Pure Public Goods provided by national govt.

• Fiscal Decentralization and decentralization theorem

• Benefit matching and transparent delivery

• Economies of scale, financial and admin issues consider

Revenue raising power

• Following assignment of revenue raising power show decreasing level of LG fiscal autonomy

• SNG Sets tax rate & base

• SNG sets only tax rate

• SNG set only tax base

Core 1st Generation Approaches to FD and ICT LG Act. 2015

Inter-governmental Fiscal Transfer

• Service delivery and taxing power is first level (constitutional level) issue in 1st generation.

• Fiscal transfer is second order (or non-constitutional level) issue

• Imbalance: vertical and horizontal imbalances

• Its best tool for removing imbalances

Subnational borrowing

• SNG borrowing is a controversial issues due to SNGs’ capacities

• investment expenditure and future generation

• Mismatch b/w revenue and expenditure prompt borrowing

• Borrowing increase accountability

• Budget constraints in borrowing

2nd Generation Approaches to FD and ICT LG Act. 2015

Two main consideration in 2nd generation theory

i. Political process and behavior of political agent

ii. Asymmetric information and political agent

Weingast: Market Preserving federalism (competition)

Seabright: Incomplete contract (centralization more prefer)

Petchey and Levtchenkova: equalization grants are not determined exogenously

RELATIONS WITH GOVERNMENT

The Government may issue directions to a local government BOUNDING the LG.

– Or direct the officer authorized to take any necessary action.

Govt. may direct LG to collect taxes.

Govt. to provide necessary resources to LG (budgetary provisions) for its directions.

The Government shall appoint a LOCAL GOVERNMENT COMMISSION to

conduct inspections, inquiries, audit, resolve disputes with government,

enquire into matters referred, submit annual report on performance, take

cognizance of violation of laws/rules.

The Commission shall be responsible to the Government

LOCAL GOVERNMENT COMMISSION

The Commission shall consist of:

A Chairman, who shall be an eminent citizen of integrity and good track record or a

retired civil servant, to be appointed by the Government for a term not exceeding

FIVE years;

two members from general public, one each nominated by the leader of the House

and leader of the Opposition in the National Assembly;

Two eminent, qualified and experienced technocrat members selected by the

Government;

Representative of Chief Commissioner ICT

Director, Development & Finance, ICT.

LOCAL GOVERNMENT BOARD

A LG Board shall be constituted.

Headed by a Chairman.

Not less than 3 and not more than five members.

All appointed by the Govt.

– It will be a corporate body.

– Power to acquire, hold and transfer property in its name.

– Chief Commissioner is Ex-officio member.

– Makes appointments, transfers, disciplinary actions.

DISSOLUTION OF LOCAL GOVERNMENT

The Govt. may dissolve LG before elections or expiry of their term.

Powers and functions being exercised by LG shall vest in Govt. (Board, funds and

properties)

Offences have been provided in Schedules V and VI. Schedule V offences carry

imprisonment and fines as punishments while Schedule VI offences carry only fines as

punishment by issuing tickets

In order to enforce the municipal bye-laws and other provisions of the Act, Mayor or

the Chairman, with approval of Metropolitan Corporation or Union Council respectively,

shall authorize the officials of local government as Inspectors for enforcement of

offences

TRANSITIONAL PROVISIONS

Except as provided by this Act, all existing by-laws, rules, regulations,

notifications or any other legal instrument shall, subject to the Act, continue in

force, so far as applicable and with the necessary adaptations, until altered,

repealed or amended by the Government

The Government shall bring all bye-laws, rules, regulations, notifications or

any other legal instrument, issued under any law in force on the date of

commencement of this Act, in conformity with this Act within a period of two

years from the date of commencement of this Act

MISCELLANEOUS

Any question or doubt as to the interpretation of any provision of this Act or of any

order made thereunder shall be resolved by a decision of the President and such

decision shall be final.

The Government or an officer designated by the Government shall, within one hundred

and eighty days of the commencement of this Act, divide rights, assets and liabilities of

the local governments or the Authority amongst the local governments and the

Government or the Authority, and the decision of the Government or of the designated

officer shall be final

Critical Analysis

Capacity Issues

Political Affiliation

Overlapping and Coordination failure

Dependency on federal/ provincial transfer

Capacity issues in tax collection

Audit Issues:

Any Question

Islamabad Local Government

Education

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