CAG Report on Urban Local Bodies

Context: The Comptroller and Auditor General (CAG) of India highlighted critical gaps in the functioning of Urban Local Bodies (ULBs) across 18 states, 31 years after the 74th Constitutional Amendment was introduced to empower these self-governing institutions.

Data on Urban Local Bodies (Source: CAG Report, 2024)

• Resource-Expenditure Gap: ULBs face a 42% gap between their resources and expenditures.

• ULBs face a 42% gap between their resources and expenditures.

• Funding Sources: Only 32% of revenue comes from own resources; 68% is dependent on Union and state government transfers.

• Only 32% of revenue comes from own resources; 68% is dependent on Union and state government transfers.

• Property Tax Collection: ULBs realize only 56% of property tax demands.

• ULBs realize only 56% of property tax demands.

• Expenditure Allocation: Only 29% of ULB expenditure is spent on programmatic and developmental work.

• Only 29% of ULB expenditure is spent on programmatic and developmental work.

• Staffing: Average vacancy rate: 37% of sanctioned strength. Urban bodies in 16 states have limited or no autonomy over recruitment.

• Average vacancy rate: 37% of sanctioned strength.

• Urban bodies in 16 states have limited or no autonomy over recruitment.

• Devolution of Functions: On average, 17 out of 18 functions (as per the 74th Amendment) are devolved. Nine states (e.g., Chhattisgarh, Maharashtra) devolved all 18 functions. Urban planning and fire services remain the least devolved functions.

• On average, 17 out of 18 functions (as per the 74th Amendment) are devolved.

• Nine states (e.g., Chhattisgarh, Maharashtra) devolved all 18 functions.

• Urban planning and fire services remain the least devolved functions.

• Autonomy: Only 4 out of the devolved functions have complete autonomy.

• Only 4 out of the devolved functions have complete autonomy.

• Population Impact: The report covers 393 ULBs catering to 241 million people across 18 states.

• The report covers 393 ULBs catering to 241 million people across 18 states.