ILAM MUNICIPALITY Misused Road Funds

Local Self Governance Act 1999 encourages participation of consumers in development projects through maximum utilization of municipal investment. However, the experience of Ilam Municipality is different. Although the Municipality has spent huge amou

Jan. 23, 2011, 5:45 p.m. Published in Magazine Issue: Vol. :04 No.-15 Jan. 21-2011 (Magh 07,2067)

Five years ago, Ilam Municipality set up a Consumers Group to construct a 4-kilometer road in line with the Local Self-Governance Act 1999. The accord with the users group was to complete the road work in two years. The deadline passed. Three years later, work is still in a preliminary stage.


Considerable amount of money has gone into building the Tilkeni-Namsaling-Naya Bazar-Fikkal road. The municipality has been allocating the budget for the project every year, but nobody knows how many more years it will take.


A number of other projects are facing a similar fate. As per the annual records of Ilam Municipality, it spends 60 percent of its total budget in development work, but only less than 25 percent work is successful. Most of the unsuccessful projects are run by users groups, failing to deliver results by the deadline.

Talk of the Town
Let alone bigger central projects, the road is the latest talk of the town. Almost every resident of Ilam knows about the delay in the road work, who are behind it, and who benefit. It is an open secret.


Matrika Dahal, a permanent resident of Ilam Municipality ward number 6, is one of knowers. He is dissatisfied with the work on the road linking Tilkeni Turn of Ilam Municipality to Mai River. The municipality had allocated NRs. 400,000 (US$ 5500) to initiate the road construction in 2006.


“Documents show that the municipality has already paid the money. But, where did all the money go? No one knows,” said Dahal.


The road connects Namsaling, Naya Bazar and Fikkal of Ilam. In 2007, the municipality allocated Rs. 5.4 million for completion of the road. However, Rs. 2 million was deducted to construct a taxi stand.


“Despite so much money going into the project, the road is far from usable as yet,” Dahal said.


Tractors are using the simple track with difficulty as they go to Mai River to collect sand and other construction materials.


After locals lodged complaints, the municipality has started constructing drains alongside the road.


Dahal said, "As the contractor hired by the Consumers Group didn't work properly, the locals had to evacuate mud and stones from the construction site. I am firmly confident that the road will start to decay after completion.”

Local residents complain that there is corruption even in the purchase of construction materials. The contractors are ready to pay more than the running rate of any products or services provided to them. People say the extra money, which is paid to them, will be returned to the members of the Consumers Group for their private use.

After this revelation, the municipality has now decided not to award any development work to the users groups. It will instead contract out works to competitive bidders in accordance with the Public Procurement Act 2007 and Public Procurement Regulations 2008.


Consumers’ Group
Local residents talk about how the economic standards of people involved in the users group went up.


"These same people used to walk while going anywhere before they were in the committee. Now they ride their own bikes," said a resident on condition of anonymity.


“These members of the Consumers Group are affiliated to the sister organizations and other structures of political parties,” said a local resident of ward number 6.


"All are cadres of the political parties. We have broadcast or published the news regarding this but nothing affects them," said Som Suseli, former president of Federation of Nepalese Journalists, Ilam Branch.


“Only 15 percent of the Rs. 3.4 million funds has been used properly. Rest of the money has gone into pockets of cadres of political parties who are in the Consumers Group.”


Interestingly, political parties and the municipality set up the group involving most of the members from other VDCs.


"We cannot recognize the members of the Consumer Group. We hear that they are from Shri Antu and Samalbung," said Matrika Dahal. “Had locals been in the users committee, the Tilkeni-Fikkal road would have been blacktopped by now.”


While forming the Consumers Group of Tilkeni-Fikkal road, political parties had a big row for at least a month, executive officer of the municipality Yubraj Dahal said. He claimed the procedure to form the Consumers Group was wrong. "We have still not returned their deposited money yet."


Clause 119 (1) of the Local Governance Act 1999 says the municipality may form consumers groups from direct beneficiaries in implementing the project.


Political Mechanism
There are ten members in the Ilam Municipality’s Political Mechanism comprising people nominated by three major and other minor political parties.

However, the representatives of the political parties claim that they are unaware about the programs that the municipality launches.

"It is mysterious that we do not know about the programs launched by the municipality. There is no transparency," CPN (UML) representative Mahesh Basnet said.

Political representatives say that it is the hardest time to understand the demand of the public. The employees try to implement the development works under the influence of bribes, they say.

Basnet said, "The employees of the municipality only think about how to be economically better off personally."

Clause 117 (2) of Local Self-Governance Act 1999 says the secretary shall implement or help implement the projects as per the calendar referred to in sub-section (1) in coordination with the concerned ward committee. However, projects directly concerning the municipal denizens shall be operated through the consumers committee.

In the absence of elected representatives, the political mechanism exercises all the authorities given by the act.


Locals say political representatives have no work. "If the municipality doesn't discuss implementation of plans with the political representatives, why should they be there?” asked Bijay Shekhar Bhattarai of the municipality. "It is the representatives of political parties who are responsible for the mess. The political representatives neither resign nor work to activate the employees of the municipality."



 

 



Dissatisfied Political Parties
Ilam Municipality was established as far back as 2015 B. S. But it has yet to develop a trend to consult with the representatives of the political parties regarding the expenses of the municipality.


Mahesh Basnet, who was a mayor before, expressed dissatisfaction about every municipal decision on expenses. "These decisions are not transparent," Basnet says. "The trend is one man prevails in the municipality."


The municipality, for example, has a mandate to donate only up to Rs. 100,000 or a certain percent of the total budget per annum as per the Act. But the donation, the UML leader claims, exceeds that amount because the executive officer, who is the chief of the municipality, does all work related to every expense.


The absence of elected representatives is the main obstacle to reaching the fruits of the development projects to the citizens. The political party representatives say the employees are not accountable to fulfill the public demands. Instead they work for their own benefits.

"The employees of the municipality work under the influence of political parties, not according to the necessity of the people," Basnet says. 


When elected representative are there, people go to them with complaints against any type of corruption, he said. “But where do they go now?"


The municipality holds meetings with political representatives hardly once in six months. “So, the political parties do not know about the agreement with the donor agencies,” he says.

These meetings take place when the municipality is in problem.


The president of Nepali Congress of Ilam Keshav Thapa agrees that the development works are not going on in full swing. "If there had been the elected representatives there would be many development works in the municipality. Tilkeni-Fikkal road would have been a success story," Thapa said. 


Consumers to Contractors
The municipality set up the consumers’ group according to clause 119 of Local Self Governance Act 1999 because the road project directly concerned the local people. The Act doesn't support contracting out development projects meant for the community use.

However, as the road project set a bad example, Ilam Municipality has decided to implement development works through open bidding and not through the Consumers’ Group. The executive officer of the municipality Yubaraj Dahal said, "We have learnt a great lesson from Tilkeni-Fikkal road project. The municipality has decided not to involve the Consumers Group in the construction of such projects."

The 900-meter Bhakta Bahadur Dewan Marg has been blacktopped by a contractor for 3.5 million rupees in just a year under open bidding. Now contractors are bidding for several projects, including the construction of trekking trails and motor roads.


One of the major problems with the users group is that the members are appointed on political recommendations. “Despite prevailing criteria which include that the members of Consumer Group must be the residents of the area, the political parties appointed non-local members, so the development works are badly affected," Dahal said. "There was no alternative other than to bar them from implementation of the development works. Even the representatives of the political parties got involved in the decision.”

Open Bidding
The municipality official said that it is easier to work under the competitive bidding system. Clause 116 (2) of Local Self-Governance Act, 2055 (1999), requires that after the selection of the projects, the municipality will have to prepare a calendar of operation and implementation or help get these ready for such projects.


Tenders for such projects are awarded as per the legal provisions specified by Local Self Governance Act 1999, Public Procurement Act 2007 and Public Procurement Regulations 2008. 


The Public Procurement Act 2007 and Public  Procurement Regulations 2008 clearly set the standards for the construction of projects, procurements including acquisition of any goods, consultancy services or others services or carrying out or causing to be carried out any construction works, by a public entity.


One of the objectives of Public Procurement Act is to make the procedures, processes and decisions relating to public procurement much more open, transparent, objective and reliable, obtain the maximum returns of public expenditures in an economical and rational manner by promoting competition, fairness, honesty, accountability and reliability in public procurement processes, and; ensure good governance by enhancing the managerial capacity of procurement of public entities in procuring, or causing to be procured, construction work and procuring goods, consultancy services and other services by such entities and by ensuring the equal opportunity for producers, sellers, suppliers, construction entrepreneurs or service providers to participate in public procurement processes without any discrimination.


The act has clear guidelines for bidding process, awarding contract and process for completion and ensuring the quality of works.  “This act helps us a lot to avoid the political pressure and use the public resources for the greater benefits of the people,” said Dahal.


 

Extortion of Money
Wherever the Consumer Groups are formed, the local cadres of the political parties regularly extort money from them. Political workers make different program proposals and take donations. The executive officer of the municipality Dahal said, "The pressure comes from UCPN (Maoists) and Limbuwan groups. In the last fiscal year, more than three lakh rupees went through this."


The employees of the municipality say the sister organizations of different political parties come to the municipality demanding donations. "They come here claiming that they are going to organize conventions and other programs of the organizations," Dahal said. "This is a hazard for the municipality."


The locals do not believe the money is utilized properly in the works they have been paid for.


The Ilam president of Nepali Congress Thapa said that this happened because of vested interests of the political parties. The money, as a result, is misused.


Ilam Municipality’s road projects show how politically motivated nominees in the Consumers Group are consuming the funds allocated for the benefit of the people. Local cadres of political parties posed obstacles, instead of extending help, to the municipality in the development works. This is an example of how political instability is badly affecting the entire development projects and real demands of the people.
This is the sixth of nine investigative stories on politics of local bodies supported by The Asian Foundation. The views expressed by the Author do not necessarily reflected those of The Asian Foundation or founder.
se type your text here.ease type your text here. Extortion of Money
Wherever the Consumer Groups are formed, the local cadres of the political parties regularly extort money from them. Political workers make different program proposals and take donations. The executive officer of the municipality Dahal said, "The pressure comes from UCPN (Maoists) and Limbuwan groups. In the last fiscal year, more than three lakh rupees went through this."


The employees of the municipality say the sister organizations of different political parties come to the municipality demanding donations. "They come here claiming that they are going to organize conventions and other programs of the organizations," Dahal said. "This is a hazard for the municipality."


The locals do not believe the money is utilized properly in the works they have been paid for.


The Ilam president of Nepali Congress Thapa said that this happened because of vested interests of the political parties. The money, as a result, is misused.


Ilam Municipality’s road projects show how politically motivated nominees in the Consumers Group are consuming the funds allocated for the benefit of the people. Local cadres of political parties posed obstacles, instead of extending help, to the municipality in the development works. This is an example of how political instability is badly affecting the entire development projects and real demands of the people.
This is the sixth of nine investigative stories on politics of local bodies supported by The Asian Foundation. The views expressed by the Author do not necessarily reflected those of The Asian Foundation or founder.
se type your text here.ease type your text here.

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