The Hindu Business Line : Urban Fund tied to State reforms

THE State governments seeking funds under the Urban Reforms Incentive Fund (URIF) announced in the Budget 2003-04 would have to give evidence of specific reform measures to the Centre.

The Department of Urban Employment and Poverty Alleviation has drawn out a system of assigning weightage to different urban reforms before releasing the States' share from the Fund. The State governments would have to sign a memorandum with the Centre outlining milestones in seven areas of reforms. Release of funds would be linked to the States achieving the milestones agreed upon in the agreement, an official release said here.

In case a State Government is not able to implement all the seven specific reforms, it would be allowed to sign a truncated memorandum of understanding and its funding would get reduced accordingly.

The seven specific reforms are rationalisation of stamp duties, reform of rent control laws, levy of reasonable user charges (20 per cent weightage each), repeal of Urban Land Ceiling and Regulation Act, computerised registration, property tax reform and introduction of double entry system of accounting (10 per cent each). The URIF was announced in the Budget 2003-04 with an initial allocation of Rs 500 crore. Allocation from the Fund would be released as additional Central assistance to the annual plans of States. The Planning Commission has worked out State-wise allocation from the fund on the basis of the population of each State.

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