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According to a press release, the Ministry of Civil Aviation is considering abolishing the development fee being levied at the Delhi and Mumbai airports. The Ministry has already asked the Kolkata and Chennai airports not to levy a development fee. According to the Ministry, this is being done to make air travel more affordable. Currently, development fee charged at the Delhi Airport ranges from Rs 200 to Rs 1300. At the Mumbai airport, the fee ranges from Rs 100 to Rs 600. It is pertinent to note that though, the Ministry has proposed abolishing the development fee, the airport operators may still levy a user development fee. In this blog we discuss some of the aspects of development fee and user development fee. What is a development fee and a user development fee? Development Fee (DF) is primarily intended to fund the establishment or upgradation of an airport. It is intended to bridge the gap between the cost of the project and the finance available with the airport operator. Currently only the Mumbai and Delhi Airports levy a DF. However, there are other types of tariffs, such as a user development fee (UDF), which may be levied by the airports. UDF is generally regarded as a revenue enhancing measure. It is levied by the airport operators to meet operational expenditure Section 22 A of the Airports Authority Act, 1994 (amended in 2003) gives the Airport Authority of India (AAI) the power to levy and collect a development fee on embarking passengers. The Act provides that the development fee can be utilised only for: (a) funding or financing the upgradation of the airport; (b) establishing a new airport in lieu of the airport at which is levied; and (c) investing in shares of a private airport in lieu of an existing airport . Unlike DF, UDF is not levied and collected under the Airport Authority of India Act but under Rule 89 of the Aircraft Rules, 1937. Under the Aircraft Rules, UDF may be levied and collected by either the AAI or the private operator. According to the Airport Economic Regulatory Authority, UDF is levied to ensure that the airport operators can get a fair return on their investments. What is the role of the Airport Economic Regulatory Authority? In 2008, the Airport Economic Regulatory Authority (AERA) was established to regulate aeronautical tariffs. Among others, AERA’s functions include determining the amount of DF and UDF for major airports. In case of non-major airports, the UDF shall be determined by the central government. What has been the role of the Supreme Court? In 2009, the central government permitted the Mumbai and Delhi Airports to levy a DF. The rate of was prescribed by the central government and not by AERA. In 2011, the Supreme Court held that this levy of DF was illegal. The Court based its decision on two grounds. Firstly, the court held that the rate of DF has to be determined by the AERA and not the central government. Secondly, the Court held that the power to levy the fee lies with the Airport Authority as the development fee can only be utilised for the performance of the purpose specified in the Act. The court held that while the Airport Authority can utilise the development fee for any of the functions prescribed in the Act, it can assign the power to levy a development fee to a private operator only for funding or financing the upgradation or expansion of the airport. Can private operators collect a development fee and a user development fee? In 2003, the government amended the Airport Authority of India Act to allow the AAI with the prior permission of the central government to: (i) to lease the premises of airports to private entities to undertake some of the functions of the AAI; (ii) levy and collect a development fee on the embarking passengers at a rate that may be prescribed. Till 2011, the power to collect the development fee lay only with the Airport Authority. However with the notification of the Airports Authority of India (Major Airports) Development Fees Rules, 2011, private operators have also been permitted to collect the development fee.
In India, police and law and order come under the purview of state governments.[1] Accordingly, each state has its own police force for maintaining law and order and investigating crimes. However, due to financial and other constraints, states have critical gaps in their policing infrastructure.2 Figure 1 shows the expenditure by states on police, as a percentage of their total budget. In 2015-16, Manipur spent the highest proportion of its state budget on police, followed by Punjab and Jammu and Kashmir.
Figure 1: Police Expenditure as a proportion of total state budget
The Ministry of Home Affairs has been supplementing resources of states under the Modernisation of Police Forces (MPF) scheme.[2] The Union Cabinet last week approved the implementation of an umbrella scheme of MPF and has allocated funding of Rs 25,060 crore for the 2017-18 to 2019-20 period.[3] In light of this decision, we present the key features of the scheme and examine other issues related to the police forces.
Modernisation of Police Forces scheme
The MPF scheme was initiated in 1969-70 and has undergone several revisions over the years.2 It was allocated Rs 11,946 crore for the period between 2012-13 to 2016-17, which has now been doubled after last week’s Cabinet approval.[4] Funds from the MPF scheme are typically used for improving police infrastructure through construction of police stations and provision of modern weaponry, surveillance and communication equipment. Upgradation of training infrastructure, police housing and computerisation are also important objectives funded through the scheme.
Following the recommendations of the Fourteenth Finance Commission, to increase the share of central taxes to states, it was decided that the MPF scheme would be delinked from central funding from 2015-16 onwards.[5] States were expected to finance the scheme using their own resources. However, of the recent allocation made by the Cabinet, Rs 18,636 crore will come from the central government and Rs 6,424 crore will come from the states.3 This implies that the centre will fund almost 75% of the scheme.
Underutilisation of Funds
Data from the Bureau of Police Research and Development (BPR&D) shows that funds have not been fully utilised under the MPF scheme. In the year 2015-16, out of a total grant of Rs 9,203 crore that was made available for modernisation, states utilised only Rs 1330 crore (14%).[6]
Figure 2 shows the trend in underutilisation of modernisation funds from 2009-10 to 2015-16. Over this period, there has been a consistent underutilisation of funds by states. On average, states spent 55% of the funds allocated to them, with the highest being 86% utilisation in 2013-14.
Figure 2: Utilisation of funds for modernisation by states (%)
Issues related to police forces
While the MPF scheme seeks to improve police infrastructure, there are a number of structural issues that have been raised by experts over the years related to police forces. We discuss a few of these below.
(i) Overburdened police force
Apart from the core function of maintaining law and order, police personnel carry out various other functions such as traffic management, disaster rescue and removal of encroachments. The Second Administrative Reforms Commission (2007) has noted that these extra obligations lead to overburdening of the police force. It recommended that these functions should be carried out by other government departments or private agencies.[7] Note that as of January 2016, 24 per cent of sanctioned police posts in India were vacant.6 This indicates that police personnel may be overburdened, which may have negative consequences on their efficiency and performance.
(ii) Poor quality of investigation
In 2015, the conviction rate for crimes recorded under the Indian Penal Code, 1860 was only 47%.[9] The Law Commission (2012) observed that one of the reasons for low conviction rates in India is poor quality of investigation by police.[8] The police lack training and expertise required to conduct professional investigations. They also have insufficient legal knowledge and inadequate forensic and cyber infrastructure. In light of these deficiencies, the Second Administrative Reforms Commission (2007) recommended that states should have specialised investigation units within the police force for better investigation of crimes.7
(iii) Police accountability
In India, control over the police force vests with the political executive.[10] The Second Administrative Reforms Commission (2007) noted that this has to led to abuse of police personnel and interference with their decision-making authority.7 To allow the police operational autonomy while maintaining accountability, the Supreme Court issued guidelines to the central government and state governments (and Union Territories) in the year 2006.[11]
The guidelines provided for the establishment of three institutions: (i) a State Security Commission, (ii) a Police Establishment Board, and (iii) a Police Complaints Authority.11 The Supreme Court also stated that the state Director General of Police (DGP) should be selected from three senior-most officers of the state empanelled by the Union Public Service Commission and must have a minimum two-year tenure.
In addition, the court recommended that officers in key positions in the field (Inspector General in charge of Range, Station House Officer) must be given a two-year tenure. Currently, DGPs and senior officers are selected by the political executive of the state and are not guaranteed security of tenure.[10] In order to improve the quality of investigation, the Court recommended that investigating police must be separated from law and order police.11
These guidelines and recommendations of other expert bodies were used to create the draft Model Police Bill, 2015 by BPR&D, which states have been encouraged to adopt. While states have partially implemented some of these guidelines, no state has adhered to them in full.[12] In most states, the three institutions which the Supreme Court has directed states to create have not been given the authority they need to ensure accountability and insulate the police force from political misuse.12
[1]Entry 1 and 2, List II, Schedule 7, Constitution of India, 1950.
[2] Modernisation of Police Force Scheme Book, Ministry of Home Affairs, 2010 http://mha.nic.in/sites/upload_files/mha/files/Scheme-MPF-11Nov.pdf.
[3] “Cabinet approves umbrella scheme of Modernisation of Police Forces”, Press Information Bureau, 27th September 2017.
[4] Annual Report, Ministry of Home Affairs, 2015-16, http://mha.nic.in/sites/upload_files/mha/files/AR(E)1516.pdf.
[5] “Major Programmes Under Central Assistance for State Plans”, Union Budget, 2015-16 http://indiabudget.nic.in/budget2015-2016/ub2015-16/bag/bag8.pdf.
[6] “Data on Police Organisations”, Bureau of Police Research and Development, 2016, http://bprd.nic.in/WriteReadData/userfiles/file/201701090303068737739DATABOOK2016FINALSMALL09-01-2017.pdf.
[7] “Public Order”, Second Administrative Reforms Commission, 2007, http://arc.gov.in/5th%20REPORT.pdf.
[8] “Report No. 239: Expeditious Investigation and Trial of Criminal Cases Against Influential Public Personalities”, Law Commission of India, March 2012, http://lawcommissionofindia.nic.in/reports/report239.pdf.
[9] “Crime in India”, National Crime Records Bureau, 2006-15 http://ncrb.nic.in/StatPublications/CII/CII2015/FILES/Compendium-15.11.16.pdf.
[10] Section 3, Police Act, 1861.
[11] Prakash Singh vs Union of India, Supreme Court, Writ Petition (Civil) No. 310 of 1996, November 8, 2010.
[12] “Building Smart Police in India: Background into the needed Police Force Reforms”, Niti Aayog, 2016, http://niti.gov.in/writereaddata/files/document_publication/Strengthening-Police-Force.pdf.
