~Municipalities.~--It is matter for reflection that, while the effect of British administration has been to weaken self-government in villages, half a century of effort has failed to make it a living thing in towns and districts. The machinery exists, but outside a few towns the result is poor. The attempt was made on too large a scale, municipal institutions being bestowed on places which were no more than villages with a _bazar_. This has been partially corrected of late years. A new official entity, the "notified area," has been invented to suit the requirements of such places. While there were in 1904 139 municipalities and 48 notified areas, in 1911-12 the figures were 107 and 104 respectively. Even in the latter year 32 of the municipalities had incomes not exceeding L1000 (Rs. 15,000). The total income of the 104 towns was Rs. 71,41,000 (L476,000), of which Rs. 44,90,000 (L300,000) were derived from taxation. Nearly 90 p.c. of the taxation was drawn from octroi, a hardy plant which has survived much economic criticism. The expenditure was Rs. 69,09,000 (L461,000), of which Rs. 40,32,000 (L269,000) fall under the head of "Public Health and Convenience." The incidence of taxation was Rs. 2.6 or a little over three shillings a head. ~District Boards.~--The district boards can at present in practice only be treated as consultative bodies, and well handled can in that capacity play a useful role. Their income is mainly derived from the local rate, a surcharge of one-twelfth on the land revenue. In 1911-12 the income was Rs. 53,74,000 (L358,000) and the expenditure Rs. 54,44,500 (L363,000). The local rate contributed 51 p.c. and contributions from Government 23 p.c. of the former figure. Public works took up 41 and Education about 20 p.c. of the expenditure. ~Elections.~--Some of the seats in most of the municipalities and boards are filled by election when any one can be induced to vote. Public spirit is lacking and, as a rule, except when party or sectarian spirit is rampant, the franchise is regarded with indifference. CHAPTER XXIV REVENUE AND EXPENDITURE ~Financial Relations with Government of India.~--Local governments exercise their financial powers in strict subordination to the Government of India, which alone can borrow, and which requires the submission for its sanction of the annual provincial budgets. To ensure a reasonable amount of decentralization the Supreme Government has made financial contracts with the provinces under which they receive definite shares of the receipts, and are responsible for definite shares of the expenditure, under particular heads. The existing contract dates only from 1911-12 (see Table V).