MOUD to Discuss Reforms With States Tomorrow

The Ministry will discuss a set of five major reforms with states and Union Territories at a ‘National Workshop on Urban Development’

Ministry of Urban Development has evolved a new reform step to enable states and cities for taking better transformational reforms over the next three years in urban development, governance, planning and finance.

The Ministry will discuss a set of five major reforms with states and Union Territories at a ‘National Workshop on Urban Development’ to be held here tomorrow.

Minister of Urban Development M.Venkaiah Naidu will chair the deliberations on the reforms and six other new initiatives that promote these reforms since huge private sector investment is envisaged under five of these initiatives.

The concerned Group of Secretaries in their report on urban sector have recommended that “After a review of the schemes over the years, the Group felt that instead of an incremental approach, the time has come for ushering in transformational reforms in governance, planning and finance”.

The major reforms recommended by the Group of Secretaries are moving to a Trust and Verify Approach, formulating land title laws, credit rating of urban local bodies and promoting value capturing financiang.

Inverting the model of verifying first and approving later which is resulting in huge delays, this ‘Trust and Verify’ approach has been recommended in respect of Permissions for building construction, Change of title in municipal records (mutation) and Birth and Death registration, involving the largest number of physical interactions between city governments and citizens.

Quoting a study by McKinsey, the Group of Secretaries noted that over 90 per cent of the land records in the country are unclear and land market distortions and unclear land titles are costing the country 1.30 per cent of GDP per year and accordingly recommended enactment of land titling laws and their implementation in a specific time frame.

Noting that the total revenues of the municipal sector accounts for only 0.75 per cent of the country’s GDP as against 6 per cent for South Africa, 5 per cent for Brazil and 4.50 per cent for Poland, the Group recommended Municipal Bonds further to Credit Rating of ULBs and Value Capture Finance tools for meeting the capital expenditure needs of cities.

Expressing concern over shortage of qualified technical staff and managerial supervisors in ULBs preventing innovation, the Group recommended induction of professionals in city governments by encouraging lateral induction and filling top positions in cities (Commissioners and Heads of Finance and Revenue) through open competition.

Ministry will also discuss with States and UTs new initiatives like Transit Oriented Development Policy, Metro Policy, Green Urban Mobility Scheme, Liveability Index for Cities, Value Capture Policy and many more.