Minimum Condition and Performance Measures Guidelines includes Poverty Environment Linked Indicators

Background

Minimum Condition and Performance Measure (MCPM) system has been considered as an integral part of the overall governance reform system in Nepal. According to this system, the Government of Nepal annually adjusts the grants to be provided to local bodies (LB) based on their scoring in the MC/PM assessment. LB denotes to District Development Committee (DDC), Municipality and Village Development Committee (VDC). LBs that meet the MC and score high in PM are provided with an additional amount in the form of capital grants and vice versa. With an objective of improving LB performance through an incentive and penalty mechanism, adjusting the size of the grants to the expenditure and performance capacity in key functional areas of LBs and identifying the capacity gaps of LGs in different functional areas, the government of Nepal has adopted the MCPM system. Local Self Governance Regulation (LSGR) 1999 requires assessment of local bodies and permits subsidies to them to be expanded or reduced after having obtained recommendations from the Local Body Fiscal Commission and taking MCPM into considerations.

Environmental Consideration

MCPM Guidelines of DDC as well as Municipalities include a few environmental performance measure indicators. Moreover, number as well as marks allocated for environment performance measure indicators have increased over the years. The following sections compare the difference between DDC and Municipality Environmental MCPM indicators between 2009 and 2012. The MCPM of DDC comprises of 5 sectors and 46 indicators. The five category under performance measures include; i) Planning and program management, ii) Resource mobilization and fiscal management, iii) Budget release, expenses and program implementation, iv) Monitoring, evaluation, communication and transparency and v) Institutional management with clear roles and responsibilities.

Compare to 2008, DDC MCPM Guidelines - 2013 incorporates more performance indicators and marks related to environment. There were only two environmental performance indicators with a total mark of 2.25 in 2008 in DDC MCPM Guidelines. The environment related two indicators include ; i) Annual programs are to be designed based on sectoral development plan such as District Transportation Plan, District Agriculture Plan and ii) environment management fund needs to be established. The number of environmental performance measure indicators increased to four with a total of 8 marks in 2013. The indicators include; i) District Transportation Master Plan (DTMP) approved and implemented,  ii) Energy and environment management plan prepared for infrastructure development activities, micro hydro and energy development project formulated and implemented, local adaptation program planned and implemented, policy formulated from DDC council to use heavy equipments, iii) DDC has formulated policy for environment conservation, disaster risk reduction management and child friendly governance, budget allocated for implementing the policies and programs, and iv)Water, sanitation and health program plan, budget and declaration of open defecation free (ODF).

The MCPM of Municipality comprises of 5 sectors and 40 indicators. The five sectors include; i) Local Self Governance, ii) Financial management, iii) Planning and program management, iv) Institution and human resources development and v) Urban basic service management. While comparing Municipality MCPM Guideline of 2008 and 2012, it was revealed that there were only three environmental performance indicators with a total of 10 marks in Municipality MCPM Guidelines 2008. The environment related three indicators include ; 1) Sanitation and solid waste management following 3R principles - 4 marks, 2) Park, greenery and environment management - As per need of IEE/EIA and provisioned program, budget and human resources for environment management - 2 marks and 3) Disaster management plan developed and endorsed from Municipality Council - 4 marks.

Likewise, there are four environmental performance indicators with a total of 12 marks in Municipality MCPM Guidelines 2012. The indicators include i) Sanitation and solid waste management following 3R principles - 4 marks, ii) Environment management - As per need IEE/EIA implemented, road side plantation, environment awareness program, climate change adaptation activities, environment unit/section established, focal point with ToR identified, environment management fund developed and budget mobilized management - 4 marks, and iii) Emergency service/disaster management - Disaster management plan endorsed from Municipality Council, based on the plan annual plan formulated and approved from the council, fire brigade functional and disaster fund created and money deposited – 4 marks.

Findings  

·      Environmental performance measures indicators as well as marks have increased considerably over the years in both district and municipalities MCPM Guidelines.

·      DDC MCPM Guidelines introduced a few new environments friendly performance measure criteria such as climate change, local adaptation program, disaster risk management and policy for use of heavy equipment in 2012.

·       Municipality MCPM Guidelines 2012 introduced disaster management plan, environment awareness program, climate change adaptation activities, environment unit/section establishment and deputation of environmental focal point with terms and reference in energy and environment unit, establishment of environment management fund and budget mobilization criteria in performance measure.

Acknowledgement

Ministry of Federal Affairs and Local Development through Local Body Fiscal Commission has developed MCPM tool towards better mainstreaming poverty and environmental criteria in to local development plan and programs. The implementation effectiveness of the MCPM tools is yet to be assessed. Environmental and poverty linked criteria in the DDC and Municipality MCPM Guidelines were inserted with the support of Poverty Environment Initiatives.

 

 

References

·      GON,LBFC; 2013. Minimum Condition and Performance Measures (MCPM) Assessment Manual of District Development Committee (with revision and amendment)

·      GON,LBFC; 2008. Minimum Condition and Performance Measures (MCPM) Assessment Manual of District Development Committee

·      GON,LBFC; 2012. Manual for Assessment of Minimum Condition and Performance Measure (MCPM) of Municipalities

·      GON,LBFC; 2009. Manual for Assessment of Minimum Condition and Performance Measure (MCPM) of Municipalities with some revisions 

Tanahunsur: Emerging village tourism site in Nepal

Ek Raj Sigdel

Dhorphirdi 3, Tanahun

Tanahunsur village and adjoining areas are endowed with rich biodiversity, cultural and historical resources. The area has been emerged as a community based natural, cultural and historical tourism site in Nepal. Efforts are being made from local level towards safeguarding the natural, cultural and historical assets through promoting responsible tourism. To materialize the dream of conserving the highly valuable resources as well as alleviating the poverty, an integrated tourism plan is being prepared. It is believed that if tourism development takes places in a planned way no doubt this will be the only option for attaining the goal of conservation and development of this area.

Tanahunsur village and its adjoining tourism sites locate about 150 KM west from Kathmandu. It is placed at the middle of three major touristic areas of Nepal i.e Kathmandu, Pokhara and Chitwan National Park. Tourist can have opportunities of observing the historical palace and enjoying majestic view of various snow capped Himalayas such as Dhaulagiri, Annapurna and Manaslu. It lies at the wildlife corridor between Annapurna Conservation Area in the north and Chitwan National Park in the South. Community forestry program has been successfully implemented in this area which has provided safe haven for wildlife species, a basis for promoting ecotourism.   

To ensure conservation and sustainable use of forestry resources, the local communities through forming community forests user groups have initiated community forestry and leasehold forestry management programs for over 15 years. Sustainable supply of firewood, fodder and leaf litters to local communities is the prime objective of managing community forests, said Bir Bahadur Rana, a community forest user committee chairperson as well as inhabitant of ward number 4 of Tanahunsur VDC. After putting concerted efforts from various quarters, once declined wildlife species such as leopard, deer, pheasant are gradually being appeared in the forests. The greenery forests along with charismatic wild life species could be a basis for attracting tourists in this area. However, there are some challenges too such as, forest fire, illegal logging, and existence of environment un-friendly rural roads and unplanned settlement that needs immediate attention for promoting sustainable tourism in this area.

Horticulture, livestock and cereal crops such as rice and wheat are being cultivated in upper, middle and lower altitudes respectively of the 4000 ft Tanahunsur peak. The higher altitudes especially north facing slopes are found very suitable for cultivating citrus mainly oranges. Similarly, a middle layer is suitable for undertaking agribusiness. Agricultural practice has been followed traditional methodology that helps addressing subsistence need of rural poor. In the absence of adequate labor and skilled manpower, the productivity of these crops is also being declined over the years. However, Kalyan Dhionoj Adhikari, and K.B Thapa from Ward number 4 and 8 respectively of Tanahunsur Village Development Committee are reaping handsome benefits from orange farming in their respective sites for few years. To address the need of scarce water resources in the entire VDC, the villagers have a plan of establishing big water reservoirs at three different altitudes of Tanahunsur VDC in near future. Once the ambitious plan comes into effect, this will be milestone activity for promoting market based agricultural system. The plan for creating and maintaining water reservoir ultimately helps addressing climate change issues in a long term as well. In a short run, the strategy will help practicing organic farming and that will be a hot cake for catering to tourists.

The area is endowed with rich cultural diversity too. Magar, Newar and Brahman are the major ethnic group of this area. The different ethnic groups posses different culture and hence the diverse culture could be a strong foundation for establishing culture based tourism in this site. As said by the local communities, Panche Baja, Kaura, Dohori, Ghaatu, Pamdure/Maaruni are some the key cultural programs that are unique to this site. Tanahunsur bound tourists can experiences the cultural show while staying already established 9-10 homestay in Chandanithok and Bhorthok of Tanahunsur. Local people offer heart touching hospitality to guests. The home stay is being managed by different women group called ama samuha. Tourists can enjoy local culture, organic foods mainly kodako roti, dhido and local chicken curry and sadheko gundruk, said Bindu Thapa Magar, an inhabitant of Tanahunsur and owner of a home stay. According to Ms. Thapa annually about 150 domestic and international tourist experiences home stay facilities in Tanahunsur. During Chaite Dashain, a second biggest of Festival of Hiindus, large numbers of people throng at Tanahunsur Ancient Palace for worshiping Goddesh Kalika. During the period of Chaite Dashain, local people organize cultural show and other entertainment activities.

The suggested route for tourism promotion in this village is following Kathmandu – Dumre – Chundi – Tanahunsur – Ghasikuwa – Damauli – Pokhara and vice versa. In order to make the route functional, it is higly recommended to make the existing rural road more environments friendly. In addition, the dream project of constructing water reservoirs and zoning based agricultural practiced needs to be followed in a planned way. In addition, conservation and economic development strategy should pay attention towards retaining local youth and engaging them in tourism development activities. The upcoming tourism master plan should take account of the aforementioned issues and actions timely. 

Local Governance and Community Development Program: Vehicle for Integrating cross –Sectoral Programs

Ministry of Federal Affairs and Local Development under Local Governance and Community Development Program (LGCDP) Framework have successfully implemented the Poverty Environment Initiatives (PEI) program. It has been found that PEI was "Small but very effective" tool for mainstreaming environment and climate change considerations into local development planning and budgeting framework. During the tenure of PEI, the government produced various knowledge documents following the principle of sustainable development such as i) Current Practices of Revenue Generation from Natural Resources in Nepali, ii) Policy Brief on Rural Road Management in Nepali and English, iii)  Video Documentary,  and iv) Conceptualized Environment Friendly Local Governance (EFLG) framework. 

Similarly, under the capacity enhancement front, the Ministry produced, i) Training of Trainers' Manual on Mainstreaming Environment into Local Development Planning for Social Mobilisers, VDC Secretary and VDC Technicians, and   ii)  A Resource Book on environmental impact assessment prepared. The book guides DDC and Municipalities in preparing Initial Environment Examination's Terms of References (IEE- TOR) and reporting procedures and Environment Impact Assessment's Terms of References (EIA – ToR) and Scoping Document. The book also annexes revised Social and Environment Safeguard Framework Checklists. Moreover, Various trainings were conductedincluding  i) Organised sensitization training on Mainstreaming Environment into Local Development Planning Process conducted for DDC and Municipality Officials of Far Western and Western Development Region and ii)  Training on effective management of sand, gravel and stones were conducted in five different districts, Sunsari, Makawanpur, Dhading, Rupandehi and Kailali

Now, to upscale the PEI approach to a more strategic level, MoFALD is preparing Environment Friendly Local Governance Framework. The EFLG concept empowers household and makes them more responsible through an  "incentive based volunteer approach". The framework is developed under the principles of equity, subsidiary, harmonization and alignment, participation and collaboration, mutual accountability, downward accountability and transparency and a Sector Wide Program Approach (SWAp).  Moreover, the Framework has been considered as a major cross cutting theme under LGCDP - II Framework.

It is believed that the EFLG concept accommodates all the programs and activities that are being implemented by the government with the support of various development partners. In addition, the concept strengthens the integrated bottom up planning process, coordination and collaboration amongst the various sectors. It helps crating demand from local communities for integrated environment friendly infrastructure development and also enhances capacity of local bodies and other service providers for effectively delivering the message of sustainable development to grass root level communities.

To respond to this demand, environment, climate change and disaster management criteria are added on the essential services areas of the local bodies.   To make this possible the Environment and Energy Sections of the Districts must play a more strategic role in also addressing climate and disaster risk reduction.    They must move from being seen as a project vehicle to being fully owned and utilized by the DDCs.    The Ministry has already started this process of strengthening these Environment, Energy and Climate Sections.  

Climate change policy 2011, demands investing upto 80% climate change earmarked budget into local level through the local bodies. While there are many donor programmes funding climate change, only a few of them use national and local planning and budgeting systems.   Having the mandate to coordinate and facilitate in developing and implementing guidelines, channeling block grants and monitoring local development activities, it is wise to channel climate funds to the local level through the Ministry of Federal Affairs.  Some DDCs have set up Environment Funds as one mechanism to make this possible.   

As part of the PEI, the Ministry has proposal to support this process through the UNCDF’s Local Climate Adaptation Living Facility or LoCAL.    This can demonstrate how earmarked environmental funds will benefit the local community by reducing their climate vulnerability.   One important area will be to make sure that local infrastructure, such as rural roads are environmentally friendly or climate proofed.

In this connection, UNDP, UNCDF, UNEP and MoFALD jointly organized a workshop in Kathmandu on reviewing the modalities for how LoCAL will initially be demonstrated.   And then if successful what steps MoFALD can take to upscale the approach through the LGCDP in line with the Environmentally Friendly Local Governance –and finally into the government’s own budget. 

Need Planned Development of Millennium Trekking Route

Millennium Trekking Route, one of the prominent tourist destinations in Nepal is a combined image of existing outstanding environment, socio-cultural and biodiversity asset of Dhor Area. In a true sense, if we want to upkeep the tourism image of this Route, Dhoreli should pay more attention towards maintaining its foundations such as socio-culture, environment and economic potentials.

The area is endowed with rich biodiversity and socio-cultural resources which are a basis of this Millennium Trekking Route. Dense community managed forests, scenic landscape, diverse ecosystem that range from lowland of Hiletar to the highest point upto Gurdhunm, sprouted water sources and forests are key biodiversity assets. In addition, the area can be considered as a part of the wildlife dispersal corridor between Annapurna Conservation Area towards North and Chitwan National Park towards South. Having globally significant biodiversity resources, the corridor is getting popularity across the world and drawing financial support from national and international development partners these days.

Prem Raja Mahat, Narendra Ale, Meera Rana Magar, Tanka Paudel, Phatta Thapa, Dharma Bahadur Bania, Pradeep Paudel, to name few is national and international figures, which are becoming "scent in the gold" of this area. Because of their outstanding performance in their respective field, the Dhor area together with these personalities is getting popularity across the country - nationally as well as internationally. Similarly, community managed Phulbari Hospital in Sakhe and Sahid Krishna Library in Patan of Dhorphirdi could be an additional asset for attracting more tourists in the Millennium Trekking Route. Dhorbarahi, Bajasthala Chhetri culture, Phirphire Gurung Culture, and Magar settlement all along the trekking routes are other cultural ingredients of the Millennium Trekking Route that deserve special attention for conservation. In recognition of the perfect blend of nature and culture, the Millennium Trekking Route is going to be linked with the Great Himalayan Trek towards North and Lumbini, the birth place of Buddha in South soon.

There are many challenges coming out to maintain the higher tourism value of this area. One can see ongoing unplanned infrastructure development activities such as road construction, mining, and picnic spot construction at the cost of the pristine ecosystem all along the route. Having unplanned construction, air pollution, deforestation and degradation, the Millennium Trekking Route is losing its beauty day after day. In addition, the historical Sahid Krishna Library in Patan is being misused which is exemplified from the fact that "books are being displaced by community utensils!". In fact these activities are tarnishing the image of the Millennium Trekking Routes.

Therefore, to maintain the route and to generate more economic and employment opportunities through promoting tourism, it is high time to think of the area and put concerted efforts from across the sectors. In this front, it is opportune time to develop a master plan of the trekking route considering socio-economic, cultural, environmental, and historical and infrastructure as major components of the Plan. To develop any infrastructures, it is essential to include environmental consideration in survey and designing of the development activities. Some activities, like drainage facilities, plantation and bioengineering should be included in each and every infrastructure development activities considering it as an integral part of the infrastructure. If development takes an account of environment, then the infrastructure become sustainable as well as helps maintaining image of the Trekking Route. Similarly, it is equally necessary to maintain sociao-cultural value of this area by maintaining existing libraries, schools and hospitals.

In nut shell, the existing unplanned socio-economic and infrastructure development activities in Dhor area are leading neither towards sustainable path nor going to support tourism, one of the key potential source of income of local people in the Millennium Trekking Routes. Therefore, any development activities in the route should be guided by a master plan that takes an account of environment as well as socio-cultural component of the Millennium Trekking Route. Now time has come for planned development. 

Reforming Investments by Local Government in Nepal

The government of Nepal has shifted investment towards environment friendly infrastructures development, increasing revenues without compromising environmental integrity of natural resources and green economy taking into account to climate proof infrastructures and adaptation activities. Context Since the early 1990s, when resources and authority began to be channeled through local government bodies, the use of heavy equipment for road construction such as bulldozers and excavators started to increase. Furthermore, the desire to establish road connections quickly also resulted in the increased use of unsustainable road construction approaches and methods. Development of road network is a consensus priority at local levels, which has expedited with promulgation of LSGA (1999). Nearly 40 Mill US$ is spent annually on rural roads and every VDC spends nearly 1 mill NRs annually. Sand, gravel and Stones (SG&S) are a new-found source of revenue for many local governments (District Development Committees/Village Development Committees and Municipalities) after the promulgation of Local Self-Governance Act (LSGA 1999) and Local Self-Governance Regulations (LSGR 2000). Through LSGA and LSGR, local bodies have been given important rights to tax sell and regulate SG&S exports, the revenues from which are expected to help finance poverty reduction and inclusive/participatory local development Nepal has an abundance of SG&S resources which, if utilized judiciously, could help to shape Nepal's development and affluence. However, a balanced outlook on Nepal's SG&S sub-sector seems to be lacking. There are two extreme outlooks – one group trying to accumulate wealth at the cost of the environment and the other group opting to keep the resources intact and untouched. It is estimated that, Nepal government collects revenue from tax about Rs.1072 million per year. The annual value of environmental losses due to SG&S extraction, processing and transport estimated is Rs.206 million, or about 19 percent of the revenue generated. The situation has now improved after the Ministry of Federal Affairs and Local Development has made mandatory to local bodies that they should prepare the IEE/EIA studies of the Source Rivers and formulate environment management plans based on IEE/EIA findings. In many districts, only taxes from the transport of SG&S is being collected at road toll points, but actual extraction of the resource from the river bed or terrace is free. In fact, the SG&S resources need to be priced in all districts and this will be one avenue for increasing the revenue of the districts from SG&S. Government is in line with introducing a resource pricing system at least for control in resource extraction technology and amount, which could be nominal to start with, in order not to distort the competitiveness in the export market. Moreover, the financial and economic analysis shows that the SG&S trade, both domestic and export, is highly remunerative and a small extra resource pricing will not reduce the profitability and competitiveness to a considerable extent. At least Rs. 1.6 million in additional revenues per district can be raised by charging Rs.0.50 per cu.ft as the price of the resource. For resource pricing, initiation will be taken to adopt a system of extraction permits for each extraction zone (location), identified and recommended by the respective district IEE/EIA reports. Rural road construction will continue to be a priority at the local levels in future. It was revealed that heavy equipment based construction have started to substitute the traditional labor based and green road construction technologies in Nepal. Both technologies have their respective plus and minus points. Labor based technologies are considered environment-friendly and pro-poor with economic returns of 30% more than equipment based technology, but the technology is awfully slow and expensive. On the other hand, the heavy equipment based technologies generally have exactly opposite characteristics. Equipment based roads, can give good results, if planned properly. Wherever possible a combination of both approaches should be used (equipment based technology are cheaper and faster while the labor based technology are more sustainable and pro-poor). Nepal is highly affected by climate change. Climate change policy was formulated in 2011 to minimize the existing effects and likely impacts in different ecological regions—from the Southern plains to the middle hills and to the high Himalayan Mountains in the north, and their peoples, livelihoods, and ecosystems. To address the issues, efforts have been made from policy to institutional levels. Prior to the 15th Session of the Conference of the Parties (COP 15) to the UNFCCC, held in Copenhagen in 2009, the Government of Nepal organized a Cabinet Meeting at Kalapatthar, near the base camp of the Mount Everest, and issued the “Kalapatthar Declaration.” A Memorandum of Understanding was signed by 14 donors and development partners to support Nepal on climate change activities. The Interim Constitution of Nepal (2007) and Three-Year Interim Plan (2008-2010) have also addressed the issue of environmental management and climate change. Towards institutional front, the Government of Nepal established the Climate Change Management Division in the Ministry of Environment (MoE) in 2010. The MoE prepared the National Adaptation Programme of Action, which was endorsed by the Government on 28 September 2010. Local Adaptation Plans of Action (LAPAs) are being prepared to implement adaptation programmes. To coordinate climate change activities and implement collaborative programmes, a multi-stakeholder Climate Change Initiatives Coordination Committee (MCCICC) has been formed with representation from relevant ministries and institutions, international and national nongovernment organizations, academia, private sector, and donors. It is evident that institutional, collaborative and programmatic activities have been expanded to address the issue of climate change in recent years. Efforts to mobilise funds to implement the programmes on climate change are under way. Issues In the sand, gravel and stone sub sectors, declining pro-poor stance of the sand, gravel and stones (SG&S) sub-sector and no pricing administered for the most recently explored natural resources is considered as the major challenges for its effective management. The occurrence of spatial poverty is demonstrated by the fact that 30% of the country's 3915 VDC are yet to be linked to the road network and hence the development and expansion of road infrastructure in rural areas is obviously a consensus priority for local development across the country. In, Nepal, there are broadly two main road construction technologies in use for rural road construction, operation and maintenance: labor based and equipment based. Labor based technology (green road) has been gradually replaced by equipment based technology (non-engineered road) over the last 10-15 years with use of heavy equipments like bulldozers and excavators. Much of the climate change response within the Third Year Plan appears focused on Natural Resources Management including forests, agriculture, water and energy. However, there is no coherent definition and classification of climate change and climate change related expenditures. One of the most significant issues is how Nepal can meet the ambitious target of delivering and spending 80% of its adaptation finance at the local level. Strategies In order to increase the revenue from sand, gravel and stones, provision of environmental assessment tools like Initial Environment Examination and Environment Impact Assessment shall be employed strictly. In addition, mechanisms for SG&S resource pricing and permits for extraction shall be established. Moreover, part of the SG&S-derived revenues shall be plough back as investments in source river protection and addressing need of poor, women and impact communities. Whenever and wherever possible a blend of labor based and equipment based technologies shall be used for rural road construction to harness positive features of each technology. Cheaper and faster from equipment based technology and sustainable and poverty reducing from labor based technology. Climate change impacts the whole economy and broad range of sectors that needs to be taken into account. In this regard, climate resiliencies program shall be integrated into all aspects of national development through adopting integrated planning and budgeting schemes. Reform Process Policies are being formulated to enforce the provision of returning at least certain SG&S revenue to river ecosystem maintenance and investment in uplifting well being of SG&S impacted communities. Towards reforming investment in road sectors, local body's capacity and influences shall be strengthened to adopt environment friendly rural roads, pricing and ensuring benefits to deprived communities and deliver climate finance using a cross-sectoral approach. Similarly, reform process shall be initiated through strengthening capacity of local bodies to make them able to manage 80% of climate finance (currently estimated to be about 40%) and securing the right structures at the local level to ensure that the flow of climate finance reaches the most vulnerable communities. The government shall support inclusive green income and employment opportunities for poor and climate vulnerable groups whose health and livelihoods mostly depend on performance of natural resource management. In this regard, a possible starting point would be to integrate climate change, environment and poverty as an indicator of, or a component in, the Minimum Condition and Performance Measures (MCPM). Moreover, focus will be made to develop and implement integrated planning approaches for forestry, agriculture, irrigation, and energy and disaster mitigation as a means to adapt to climate change at the local level.

Sustainable Management of Sand, Gravel and Stone in Nepal A. Background In pursuant of addressing emerging issues in Sand, Gravel and Stone (SG&S) sub-sector and recommending policies to address the challenges and making more efficient, effective and sustainable management system, the Ministry of Local Development has administered questionnaire survey in 75 districts in October 2011. In total, 26 districts responded questionnaire until December 2011. In addition, the Ministry through Poverty and Environment Initiative (PEI) Program under Local Governance and Community Development Program (LGCDP) commissioned a study on Current Practices of Revenue Generations from Natural Resources for the Local Bodies of Nepal in five districts of Nepal – Kailali, Rupandehi, Makawanpur, Dhadiing and Saptari in 2011. Likewise, to promote third party monitoring system, the Ministry entrusted Central Department of Environment Science to carry out study on effectiveness of implementation of Initial Environment Examination (IEE) reports in Dhading and Kabhre Districts in Nepal in 2011. Based on analysis of the questionnaire survey and aforementioned two studies, various issues in sustainable extraction of SG&S were identified and policy recommendations have been made accordingly. B. Issues and challenges 1. Resource ownership There is overlap, ambiguity and conflict about who owns the resource and is entitled to collect, extract or award contracts by levying charges. Local Self Governance Act (LSGA 1999) confers exclusive ownership of district based resources including SG&S to the District Development Committees (DDCs). Forest Act 1993 provides the same authority to the Ministry of Forests and Soil Conservation for the same resource lying within forest areas. According to the Forest Act, forest products are defined as “boulders, soil, stones, pebbles, sand” among others. Likewise, Security Forces, Wildlife Reserve, Custom Office and Buffer Zones are also collecting revenues from SG&Ss. In summary, because of having different windows for collecting revenues, conflicts amongst stakeholders have been on raise in this sub sector. While analyzing the questionnaire survey data, it was revealed that 28% DDC are realizing resource use conflicts with District Forest Offices. Even, community forests are charging tax for SG&S. Also, in the absence of clear administrative demarcation between forests and other lands, inter districts revenue collection conflicts have been reported in the boarder of Kapilbastu and Arghakhachi districts. 2. Effectiveness of IEE As per the Environment Protection Regulations (EPR 1997), extraction of SG&S up to 300 m3 per day requires IEE study. Out of the total 21 SG&S revenue generating survey districts, around 38% have carried out IEE thus far. It was revealed that some districts have undergone contractual agreement even without undertaking IEE/EIA study. Other districts are realizing problems with measurement of SG&S and raising questions on the cost effectiveness of the IEE study as such. As per the mandate of the IEE report, the excavation/collection of SG&S from different river systems has affected the entire watershed in Dhading and the cumulative effects have been observed in Trishuli River and Prithvi Highway. Sediment load is increased in the Trishuli River and the highway has been badly damaged, purportedly due to the movement of large trucks carrying SG&S. Given the complexity and integrated land use system, extracting SG&S from different river system only based on IEE study is in question. 3. Revenue sharing Some Terai districts are generating revenue through export tax on SG&S. Even, some of the districts are enjoying benefit of export tax that come out from other districts. For instance, Kailali DDC administers export tax for SG&S that originates from Knachanpur District. Kanchanpur District was of the view that they also should be entitled to receive part of the export tax. According to LSGA, between 35 and 50 percent of DDC revenues derived from SG&S taxes are expected to be shared with “concerned” Village Development Committees (VDCs), Municipalities, DFOs, and where applicable, Buffer Zone Committees. Almost two third of the entire survey districts are sharing revenues ranging from 18% in Pyuthan to 90% in Udayapur District with an average of 42% with local bodies including Municipalities and VDCs. 4. Income and expenditure The local bodies have been able to raise significant tax and other revenues from the SG&S subsector. However, these revenues have not been sufficiently ploughed back into the protection of the revenue sources – the rivers. In total, 48% of the total SG&S collecting survey districts are investing part of their income ranging from 4% in Nuwakot to 81% in Chitwan to environment protection. Though, the proportion figure is small, investment trend on environment protection has been on raise. For instance, 11% of the total income of 22 districts (Rs. 15, 44, 64,073) from this sub-sector in the country was invested in environment protection activities in 2009 while the proportion of income and investment in environment protection increased by 1% and 2% respectively in 2011. Chitwan district has invested mainly to undertake IEE study. Similarly, other districts have invested primarily in stream bank protection, plantation, awareness raising, disaster reduction and climate change. As per the given authority, different organizations have different tax rate for SG&S. For instance, following the LSGA, some districts are collecting upto 50% revenue while as per the Mining Act others are collecting only 10% revenues from SG&S sub-sector. 5. Monitoring and coordination Due to ineffective monitoring, coordination and law enforcement mechanism, state of impunity has been occurred in managing SG&S in some districts. In some study districts, “mafia” operations have controlled illegal exports of SG&S products, capturing contracts, carteling in contracts, not paying DDC tax as per contract (in Kailali), collecting ransom donations from the industries, transporting products without paying taxes, etc. If such a state of impunity continues unabated, it will spread to other districts. Sometimes SG&S are being collected from Churia Foot Hills, one of the youngest and fragile ecosystems in Nepal. Having effective coordination amongst stakeholders, regular monitoring and effective law enforcement in place would help enhancing effective management of SG&S. 6. Priority to local use Resource use priority should be given to local communities. For instances the drifted wood and other SG&S products of Parsa Wildlife Reserve has not been given priority to local development, instead they are supplying the resources to crusher industries. C. Policy recommendations • Prevailing policy conflicts over ownership of the SG&S sub sector should be resolved as soon as possible through adopting one door policy. It is recommended to give whole sole management authority of the SG&S sub-sector to DDC. The upcoming revised LSGA may need to address the issue tactfully. • Need to avail simple, cost effective and user friendly IEE/EIA study guidelines and formats to local bodies including DDC and Municipalities. The revised guidelines and formats need to include simple technology to measure SG&S. Devolution of ToR approval responsibilities to DDC with a provision of constituting a technical review team comprising of Local Development Officer, District Technical Officer, District Forest Officer, District Soil Conservation Officer and District Environment Focal Person would help improve the quality of IEE reports. • In line with the existing Regulations, DDCs should be reminded that the collection and extraction of SG&S resources within their jurisdictions is subject to IEE / EIAs study being conducted. • Considering the cumulative and integrated effects of interconnected river system, it is desirable to prefer EIA to IEE. • DDCs should be encouraged to plough back at least 20 percent of their SG&S revenue earnings from each river where extraction takes place, for river protection works such as embankments, putting concrete slabs to demarcate depths up to where the extraction can take place. • A mechanism should be envisioned for sharing part of export tax with the resource generating districts. • A more stringent Act should be formulated, promulgated and effectively enforced for punishing and sanctioning illegal extraction to end the current state of impunity. The revenue management, including taxation and revenue sharing system needs be made more transparent so that it helps minimizing state of impunity. • Identify environment sensitive areas and prohibit collecting SG&S from such sites and adopt site specific policies, especially resource extraction from foot hills of Chure should be strictly controlled. • Effective monitoring and feedback mechanism should be established and strengthened from central to district level. D. References • A Review of Current Practices of Revenue Generation from Natural Resources for the Local Bodies of Nepal, a report prepared by MLD in 2011 • Central level Environmental Monitoring of Sustainable Collection/extraction of Sand, Gravel and Boulders from rivers of Dhading and Kavre district, Nepal. A Study carried out by Central Department of Environmental Science, TU in 2011

Poverty and Environment nexus in relation to rural development in Nepal

Intriduction
Environment and livelihood of local communities are linked very closely. Poverty is considered as a root cause as well as consequences of environmental degradation in Nepal. Environment friendly development supports maintaining fragile environment, while pro-poor development supports for a more robust livelihood for rural poor. In this regard, it is imperative to reform governance policy that supports pro-poor and pro-environment activities which is the very foundation of sustainable development. Therefore, for this to happen it warrants a strong policy commitment for restructuring and improving the overall governance of the environmental domain.

Economic Significance of Environmental Resources
Nepal’s economy is heavily reliant on natural resources – agricultural land, rangeland, mountain ecosystem, protected areas, wildlife, wetlands and forests. About 50% of the total income of the country is derived from natural resources based income like forest, fisheries, wetland, agriculture and tourism. Agriculture alone contributes over 50% of household income for over 80% of the total population of the country. Nepal depends heavily on traditional energy resources, which comprises 93.2% of total energy requirements. Nepal has witnessed a decrease in poverty levels from 42% in 1996 to 31% in 2004. However, there is a wide gap in poverty level between urban and rural areas which stand as high as 45%.

Resources are Being Depleted
Qualities of all the natural resources are being degraded rapidly due to over utilization and unsustainable use. Forests resources are being lost at the cost of expanding cultivated land and infrastructure development. Economic value of wetland resources are also being degenerated due to unsustainable agricultural practices in the peripheral areas and over utilization of wetland resources. Likewise, protected areas and wildlife are being threatened due to habitat loss and poaching incidence. Agricultural productivity despite the increasing coverage has been in decreasing due to excessive use of pesticides and chemical fertilizers. This together with natural hazard such as floods is expected to contribute to the annual loss of 20-25 tones/ha.

Poorer are the Hardest Hit
Natural resource dependent communities mainly the economically poor have been facing more problems compared to other income group in Nepal. In the absence of reliable alternative income and employment opportunities, poor people depend heavily on the natural resources for their subsistence need. Any changes in the resource asset will large impact the front line communities who are vulnerable to environmental shocks. Due to the loss and degradation, the drudgery for poor people has increased. They spend more time in the collection of water, firewood, fodder these days. In addition, indoor pollution has caused other heath related problems particularly, asthma, TB and vision problems. Due to the burgeoning problem, a large of number of unemployed youth leaves the country in search of employment opportunities.

Creating a “Win Win” Situation
Realizing the above scenario, it is clear that there is a clear linkage between the environment and poverty. If environment is degraded, the poorer people would be the ultimate losers. Since these variables have a positive correlation it is imperative to adopt a strategy that helps addressing both the issues simultaneously. The development should on one hand address the need of poor, while on the other it should take account of the already fragile ecosystem. In this regard, the development measures should take into account the facets of good ecology and economics. Poverty issues can be addressed by reforming the existing governance policy and institutional framework while environmental issue can be tackled through employing Social and Environmental Safeguard Framework strictly.

Address Poverty Issues
Towards the governance and institutional reforms, the decentralized process should include more poor families and minority ethnic groups in mainstream development process. The governance system should be able to address downward accountability and be socially inclusive. The field activities should be implemented through a mechanism where representation from local bodies and civil society are made mandatory, taking into account the need and aspirations of economically deprived communities. Policies and programs should give priority for people-centered development approach. Poor people need to be made a part and parcel of any development plan to make them the real owners and ultimate beneficiaries. In this regard, the local bodies should adequately allocate resources for pro poor families.

The government should co-manage and co-invest resources for the poor. In addition to the above, special focus should be given towards infrastructure development to create access to market and employment opportunities emanating from the above interventions.


Address Environmental Assets
Rural development should consider the importance of environmental assets that are so important for rural livelihood. In this regard, as environment is a cross cutting issue, it is imperative to manage environment more coherently through a partnership approach. From the policy level, an integrated planning framework that enhances multi sectoral coordination and partnership approach needs to be employed. In this regard, the role of National Planning Commission and Environment Protection Council could be very crucial. Ministry of Environment should be developed as a central lead agency to execute environment plan and programs.

As per the mandate given by the Local Self Governance Act and Regulations, an enabling environment should be created so that the Local Body can implement environment friendly development activities on their own. To ensure the environment friendly development, District Forests Coordination Committee in the district level can be made more functional. As per the size, location and cost of the sub projects, IEE or EIA needs to be strictly complied. If the aforementioned measures need to be taken seriously, then environment friendly rural development can be ensured.

Constraints/barriers
Presently, lack of elected government and fledgling capacity of the existing staff members are the major obstacles for effective implementation of the above mentioned activities. Likewise, in the name of forging political consensus for implementing activities, it sometime makes a sort of compromise and misuse of resources.

Conclusion
The environment and livelihood of local communities are inherently linked. To make the rural development sustainable, it is imperative that both poor as well as environment are safeguarded. Governance system should be reformed that address pro-poor and pro-environment policy, plan and programs.