MATS UNIVERSITY

MATS Law School

LL.M. One Year Programme
1st Semester (July – December 2004)

A Comprehensive Assignment on -
UNITARY AND FEDERAL SYSTEM
SUBJECT –COMPARATIVE PUBLIC LAW

Assignment submitted by – Priya Kanakria

Date of Submission - 8/01/2024
 Table of Contents

1. Introduction - Unitary and Federal System

2. Unitary Government
3. Distinctive features of Unitary Government
4. Federal Government
5. Distinctive feature of Federal Government
6. Advantages and Disadvantages Unitary and Federal System
7. Distinction Between Federal Structure and Unitary Structure
of Government
8. Quasi Federal Government in India
9. Features of Indian Federal system
10. Models Of Federalism
11. Constitutional Position
12. Steps toward Competitive Federalism
13. Hindrances for Competitive federalism
14. Federalism in the United States
15. Federalism in Canada Conclusion
16. Conclusion

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 Introduction - UNITARY AND FEDERAL SYSTEMS
Depending on how a constitution organizes power between
the central and sub national governments, a country may be said to
possess either a unitary or a federal system. In a unitary system the only
level of government besides the central is the local or municipal
government. Although local governments may enjoy considerable
autonomy, their powers are not accorded constitutional status; the
central government determines which decisions to “devolve” to the local
level and may abolish local governments if it so chooses. In federal
systems there is an intermediate level of governmental authority between
the central and the local; it usually consists of states or provinces, though
other entities (e.g., cantons or republics) may exist in some countries.
Aside from the number of levels, the most important distinction between
a unitary system and a federal one is that the states or provinces of a
federal state have constitutionally protected sovereignty. Within a federal
system the state or provincial governments share sovereignty with the
central government and have final jurisdiction over a broad range of
policy areas.

Federal and unitary systems are ideal types, representing the

endpoints of a continuum. Most countries fall somewhere in between the
two extremes—states can be more or less unitary or more or less federal.
So-called “semifederal” countries occupy a middle category, possessing
an intermediate level of government that does not have the same
protections of sovereignty that the states or provinces of federal states
enjoy.

Thus, On the basis of relationship between the centre and the

units, the governments may be classified as unitary and federal. In a
unitary government, all the powers of government are vested in the
central government whereas in a federal government, the powers of
government are divided between the centre and the units.

UNITARY GOVERNMENT

Unitary government is a kind of government system in which a single

power, which is known as the central government, controls the whole
government. In fact, all powers and administrative divisions authorities
lies at the central place. Today most of the government systems in the

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world are based on unitary system of government. It is slightly different
from federal model of government. In unitary government, central
government has the power to increase or curtail the power of sub
national units. It can create and abolished the same. UK, Afghanistan,
Italy, China, Saudi Arabia, Spain, etc., are the important examples of
unitary government.

The unitary government system is based on the concept of consistency,

unity, and identity that’s why the centralization of power and authority
system remains at the top priority. The decision-making power rests with
the central government that are shared by the government with the lower
level government when needed. There are not so many options for
change and new innovation as the people have a very limited voice in this
government system.

Distinctive features of Unitary Governemnt

1. Concentration of Powers: A unitary government is one in which all

the powers of administration are vested in a single centre. The centre is
omnipotent. A unitary state may be divided into small units for the sake
of administrative convenience but the units do not have any
constitutional status of their own. In other words, the constitution does
not confer any powers on the units. It is the central government which
dele gates certain powers to the units on its own accord. The units are,
therefore, subordinate agents of centre. The powers enjoyed by them are
the gifts of the centre and as such these can be taken back at any
moment. The units are thus not autonomous and independent in any
way.

2. Single Government: In a unitary government, there is a single set of

governmental apparatus. There is a single supreme legislature, single
executive body and one supreme judiciary. England, for example, is a
unitary state. She has one parliament as her legislature, the King-in-
Council as the executive and the judicial committee of the House of Lords
as her supreme judiciary.

3. Written or unwritten Constitution: A unitary government may or

may not have a writ ten constitution. As for example, England and
France are unitary states. France has a written constitution but England
has none

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4. Rigid or Flexible Constitution: Unlike a federation, a unitary state
may or may not have a rigid constitution, e.g., the constitution of
England is flexible but that of France is slightly rigid.

5. No Special Judiciary: There is no need of having a special judiciary

with wide powers of judicial veto in a unitary government. Even the
highest court of U.K., for example, cannot sit in judgment over the law
passed by Parliament.

FEDERAL GOVERNMENT

Federal government is a type of national government in which

government have powers to delegates the power to other elected member
of the states. There can be two level of federal government in a country
either it is performing through common institutions or through powers
as prescribed by a constitution of the state. It is totally opposite to the
unitary government. In federation or federal government, provinces or
territories enjoys some rights as are available to the independent states.
However international diplomacy, national security, foreign affairs and
other kinds of international dealings are solely made by the federal
government. Pakistan, India, Brazil, Switzerland, Australia, Belgium,
Canada, etc., are the significant examples of federal government. Mostly
the federal government system is referred to the United States
government. This government is based on the republicanism and
federalism.

In the federal system, power is jointly shared between the state and
federal governments. In the federal government system, the powers
never rest with one national government. However, there can be certain
powers and authorities that remain totally with the federal government
like policies on defence, budget, international diplomacy, etc. The
hierarchy of power in federal government system starts from the federal
level and then flows to the state and then local level.

Distinctive feature of Federal Government

1. Division of Powers: In a federal government the powers of

administration are divided between the centre and the units. The powers
may be distributed in two different ways. Either the constitution states
what powers the federal authority shall have, and leaves the remainder to
the federating units, or it states what powers the federating units shall
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possess and leaves the remainder to the federal authority. The remainder
is generally known as residuary powers. The first method was employed
in America and the second in Canada. The federal government in U.S.A.,
for example, is weak in relation to the states whereas the federal
government in Canada is more powerful. In a federation both the federal
and state governments are independent and autonomous in the spheres
of their powers. 'One is not subordinate to the other. Both derive their
powers from the constitution which is the supreme law of the land. The
powers enjoyed by the units are, therefore, original and not delegated by
the centre.

2. Separate Government: In a federal form of government both the

centre and the units have their separate set of governmental apparatus.
America is a federation of states. States have therefore separate
legislatures and Separate executives.

3. Written Constitution: A federal government must have a written

constitution. As a federation is a political partnership of various states
and consequently there must be a written agreement in the form of a
written constitution.

4. Rigid Constitution: The constitution of a federation should be more

or less rigid. It is regarded as a sacred agreement, the spirit of which
should not be easily violated. A flexible constitution allows a scope to the
central government to curtail the autonomy of the federating states.

5. Special Judiciary: In a federation, there are possibilities of

constitutional disputes arising between the federal centre and the units
or between one unit and another. All these disputes are to be adjudicated
in the light of the constitution. For this purpose a special judiciary with
wide powers must be established. It should act as the custodian and
guardian of the constitution. It should be vested with powers of declaring
any law, national or local, ultra vires if it is at variance with the articles of
the constitution. The constitution is thus the supreme law in a federation
to which both the centric and the state must adhere to.

Advantages and Disadvantages Unitary and Federal System

The government of a country can be classified into federal, unitary or

confederation depending upon the relation of the centre and the state. In
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some countries, the power is vested in the centre (unitary government),
while in other countries, the power is divided between the centre and
political subunits such as states or provinces (federal government) and in
some, the power is vested in the state (confederation).

Advantages of Unitary System

The unitary structure is the type of government under which the power is
concentrated only in one authority, i.e. the centre. The central
government has the final authority. The unitary structure is centralised.
UK, France, Japan, China and Saudi Arabia have a unitary government
structure.

The main advantages of the unitary structure of government

are:

1. For countries that are smaller in size, a unitary structure is the most
suitable.

2. It is less expensive
as there is no
extensive authority
to be funded.

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3. Unitary structure is quick in decision-making as all the decisions are
made by a single authority.

4. There is no chance of conflicts as all the power is vested with the

centre.

Disadvantages of Unitary System

A unitary system of government is a good system for small nations. Yet, it

still has disadvantages too. And, these are:

1. The unitary system is not suitable for geographically large countries.

Because in unitary system full power is only in the hands of centre and
they may probably not have access to rural areas.

2. Central government may not have any knowledge about the problems
and needs of the people living in rural areas.

3. There is a lack of efficiency as the central government is usually

burdened with lots of responsibilities and functions.

4. Under the unitary form of government, the country may face unequal
development and growth. The central government can find it extremely
tough to develop every part of the nation at the same time without
delegation of authority and powers.

Advantages and Disadvantages of Federal System

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The federal structure is a type of government in which the power is
divided between the centre/union and the state. The central government
has the power to delegate its authority to the state government. The
federal structure is decentralised. That is, under this system of
government, the country is controlled and governed by several local
offices or authorities rather than one single authority.

Further, under this structure, the state enjoys some independent rights.
And, both the centre and the state have their independent set of
governmental machines. However, international diplomacy, national
security, foreign affairs and other kinds of international dealings are
wholly made by the central or national government. United States,
Germany, India, Mexico and Brazil are some countries that have the
federal structure of government.

The main advantages of the federal structure of government

are:

1. Centralisation of powers leads to dictatorship. The federal system

safeguards the separation of powers and thus prevents tyranny or
dictatorship.

2. As power is divided between the union and the state, this structure is
efficient in terms of governance and administration.

3. The state or provinces enjoy some separate rights.

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4. The division of powers between the central and state government
brings excellent utilisation of resources. The central government can
focus more on international affairs and the country’s defence, while the
state government can deal with the regional needs.

Disadvantages of Federal System

Along with the advantages of the federal system, there are also some
disadvantages. These are:

1. This system of government is costly because there are many people

elected at the office, both in the centre and the state.

2. Too many elected representatives with overlapping roles may lead to

corruption.

3. It enables regional inequalities as the natural resources, employment

opportunities, etc., are different in every region or state.

4. The decision-making becomes more difficult sometimes.

Distinction Between Federal Structure and Unitary Structure

of Government

Here are the main differences between the federal and unitary structures
of governments:

Federal Structure Unitary Structure

There are two levels of government There is only one level of government
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 under this structure. under this structure.

In this structure of government, the There is no such division of power.

power is divided between the centre The whole power is vested in a single
and the state. authority, i.e. the centre.

The Constitution under this system

The Constitution can be changed by
can only be amended by a special
the supreme authority, i.e. the centre.
procedure.

There are separate legislatures both

It only has a central legislature.
at the central and the state level.

Under this system, the judiciary has

The judiciary may or may not interfere
the power to interfere in the decisions
in the decisions of the government.
of the government.

There are two sets of laws for the The law is uniform for the whole
citizens under this government country under this structure of
structure. government.

The state government has

The state government does not have
independent rights and powers of its
such powers and rights.
own.

India, as KC Wheare said, “is neither proper unitary nor

federal but quasi-federal in nature as it has features of both.”

QUASI FEDERAL GOVERNMENT IN INDIA

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 Quasi federal refers to a system of government where the
distribution of powers between the Center and the state are not equal.
India is a federation with a unitary bias and is referred as a quasi federal
state because of strong central machinery. The Constitution of India has
not described India as a federation. On the other hand, Article 1 of the
Constitution describes India as a “Union of States.” This means, India is
a union comprising of various States which are integral parts of it. The
Indian Union is not destructible. Here, the States cannot break away
from the union. They do not have the right to secede from the union. In a
true federation, the constituting units or the States have the freedom to
come out of the union. India is not a true federation. It combines the
features of a federal government and the features of a unitary
government which can also be called the non-federal features.

Because of this, India is regarded as a semi-federal state. Prof

K.C Wheare describes it as “a quasi federal state”. The Supreme Court of
India also describes it as “a federal structure with a strong bias towards
the Centre”. Indian constitution contains both features of a federal
constitution and unitary constitution. For understanding Quasi Federal
government, we have to know that what are the federal features and what
is unitary features of Indian Constitution.

The main features of Indian Federal system are as follows:

1) Division of Powers : The division of powers between two levels of

governments is an essential feature of federalism. Federalism means the
distribution of powers of the state between the central and the state
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governments. The basis of such distribution of power is that in matters of

national importance, in which a uniform policy is desirable in the interest

of the units, authority is entrusted to the centre and matters of local
concern remain with the states. In a Federation there should be clear
division of powers so that the units and the centre are required to enact
and legislate within their sphere of activity and none violates its limits
and tries to encroach upon the functions of others. The Seventh schedule
contains three legislative lists which 1 enumerate subjects of
administration viz., Union, State and Concurrent lists. The union list
consists of 100 subjects, the more important of which are defense,
railway, posts and telegraph, currency etc. The state list consists of 61
subjects, including public order, police, administration of justice, public
health, education, agriculture etc. The concurrent list embraced 52

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subjects including criminal law, marriage, divorce, trade unions,
electricity etc. The residuary powers have been vested in the central
government.

2) Supremacy of the Constitution : In a federation, the constitution

should be the supreme source of strength, both for the centre as well as
the federating units. Accordingly, Indian constitution is also supreme
and not the hand maid of either the centre or of the states. If, for any
reason, any organ of the state dares to violate any provision of the
constitution, the court of law is there to ensure the dignity of the
constitution, which is upheld at all costs.

3) A Written Constitution: A Federal constitution must almost be a

written constitution. It will be practically impossible to maintain the
supremacy of the constitution and division of powers between the centre
and the states, unless the terms of the constitution have been reduced
into writing. Accordingly, the Indian constitution is a written document
containing 395 Articles and 10 Schedules, and therefore fulfills this basic
requirement of a federal government. In fact the Indian constitution is
the most elaborate constitution of the world.

4) Rigid Constitution: A natural corollary of a written constitution is

its rigidity. In a rigid constitution the procedure of amendment is
complicated and difficult. But this does not mean that the constitution
should be legally unalterable. A Rigid constitution, as we know, is one
which cannot be changed easily. The Indian constitution is largely a rigid
constitution. All the provisions of the constitution concerning federal
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state relations can be amended only by the joint actions of the state
legislatures and the union parliament. Such provisions can be amended
only if the amendment is passed by a two-third majority of the members
present and by voting in the parliament, and is ratified by at least one
half of the states.

5) Independent Judiciary: For a federation, it is also essential that

the judiciary is impartial and independent. A Federal court is
indispensable to a federation. It acts as the guardian of the constitution.
Especially, this principle has been playing an important and key role in
the working of federal 2 government.The constitution has provided for a
Supreme Court, and every effort has been made to see that the judiciary
in India is independent and supreme. The Supreme Court of India can
declare a law as unconstitutional if it contravenes any provisions of the
constitution. In order to ensure the impartiality of the judiciary, our
judges are not removable by the executive and their salaries cannot be
curtailed by the Parliament.

6) Bicameral Legislature: A bicameral system is considered essential

in a federation because it is in the Upper House alone that the units can
be given equal representation. The Constitution of India also provides for
a bicameral legislature at the Centre consisting of the Lok Sabha and the
Rajya Sabha. While the Lok Sabha consists of the elected representatives
of people, the Rajya Sabha mainly consists of representatives elected by
State Legislative Assemblies.

Models Of Federalism

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Cooperative and Competitive Federalism in India
Federalism is derived from the Latin world foedus, which means
agreement. In fact federation is an agreement between two types of
governments sharing power and controlling their respective spheres.
Thus a federation is a system of national and local governments,
combined under a common sovereignty with both national as well as
federating units having autonomous spheres assigned to them by the
constitution.

 India opted for quasi-federal structure after independence. The term

“federal” has not been mentioned in the constitution but the working
of Indian democracy is essentially federal in structure. However, it is
the practical working style of federalism, which brought the concept
of cooperative federalism and competitive federalism in India.
 The present government is stressing on the need to leverage the
potential of cooperative and competitive federalism for achieving all
round inclusive development in India. In this context there is a need
to examine the concepts of cooperative and competitive federalism.

Cooperative vs Competitive Federalism

Based on the relationship between the central and state government–the

concept of federalism is divided into- Co-operative federalism and
Competitive federalism.

 In Cooperative federalism the Centre and states share a

horizontal relationship, where they “cooperate” in the larger public
interest.

o It is an important tool to enable states’ participation in the

formulation and implementation of national policies.
o Union and the states are constitutionally obliged to cooperate
with each other on the matters specified in Schedule VII of the
constitution.
 In Competitive federalism the relationship between the Central
and state governments is vertical and between state governments is
horizontal.

o This idea of Competitive federalism gained significance in India

post 1990s economic reforms.

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 o In a free-market economy, the endowments of states, available
resource base and their comparative advantages all foster a spirit
of competition. Increasing globalisation, however, increased the
existing inequalities and imbalances between states.
o In Competitive federalism States need to compete among
themselves and also with the Centre for benefits.
o States compete with each other to attract funds and investment,
which facilitates efficiency in administration and enhances
developmental activities.
o The investors prefer more developed states for investing their
money. Union government devolves funds to the states on the
basis of usage of previously allocated funds.
o Healthy competition strives to improve physical and social
infrastructure within the state.
 Competitive federalism is not part of the basic structure of Indian
constitution. It is the decision of executives.

Constitutional Position

 Article 1 of the Constitution states, “India, that is Bharat, shall be

a Union of States”. While the Constitution doesn’t mention the term
“federal”, it does provide for a governance structure primarily federal
in nature.
 It provides for separate governments at the Union and in the
states. Further, it specifies and demarcates the powers, functions
and jurisdictions of the two governments. Lastly, it details the
legislative, administrative and financial relations between the Union
and the states.
 The distribution of legislative powers has been divided into three
lists: the Union List, the State List and the Concurrent List. The
Union List, comprising the “vital interests of the State”, is the
longest.'
 On the Union List, Parliament has exclusive powers to legislate.
While the state has exclusive powers to legislate on the State List, in
certain situations, Parliament can also do so.
 As per the Concurrent List, the issue is more complex.

o In case of a conflict between a state and a Central legislation, the

parliamentary legislation shall prevail.
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 o This, coupled with the fact that residuary powers of legislation are
vested in the Union, gives a “unitary” tilt to federalism in
India.
 A disconcerting trend has been observed since 1950. While the
Union and Concurrent Lists have expanded, the State List
seems to have shrunk. This has led many to question the structure
of Indian federalism and to propose its remodelling.

Steps toward Competitive Federalism

 The acceptance of the 14th Finance Commission’s recommendations,

apart from significantly enhanced devolution ( devolution of 42% of
the divisible pool to states during 20015-16 to 2019-20, against 32%
suggested by the previous commission), enables states to design and
implement programmes better suited to their needs.
 Competitive federalism is not yet embraced by all the states. But a
handful of states are clearly taking steps to strengthen their business
environments, including initiating difficult reforms on land
acquisition and labour flexibility.
 Federalism is no longer the fault line of Centre-State relations but the
definition of a new partnership of team India.
 The Central government has promised decentralisation of power and
minimum interference in the State affairs.

o With the roll out of the GST, this federal structure is further
cemented.
o Government has abolished Planning Commission and replaced it
with NITI Aayog. One of the mandates of the NITI Aayog is to
develop competitive federalism. Under it;
o State governments would not look towards centre for policy
guidelines and fiscal resources.
o Share of states in central tax revenue has been increased from
32% to 42% after the recommendation of the finance commission.
o States have freedom to plan their expenditure based on their own
priorities.
o States would work with centre on a shared vision of national
objectives.
o Restructuring of centrally sponsored schemes.
o Financial sector bailout programme under UDAY scheme.
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 o Swachh Bharat Ranking system.
o Most of the state now organizes investors meet to showcase
facilities in their state to attract business and investment. This has
lead to improvement in business environment in various states.
o State wise Ease of Doing Business ranking to build a huge
sense of competition.
Hindrances for Competitive federalism

 Several issues such as trust deficit and shrinkage of divisible

pools plague Centre-State relations. Together, they make total
cooperation difficult
 Trust deficit between Centre and States is widening. Most state
governments believe the thrust on federalism is limited to lofty ideas
and big talks. Many States have shown their displeasure with the way
the Centre has been dealing with the States.
 On one hand the Centre has increased the States’ share of the
divisible pool but in reality States are getting a lesser share. The
allocation towards various social welfare schemes has also come
down, affecting the States’ health in turn.
 The present inter-state competition in attracting investment is
too early to determine whether it will really encourage competitive
patterns of investment on a continuous basis.
 The socio-economic parameters and development of each
State in India is different and while a few have made substantial
progress in terms of employment, literacy and creating a conducive
environment for doing business and investments, there are a few
which are lagging.
 There are varied economic patterns in different states. There are
deficit states or the backward regions or the states under debt. Those
states should not be treated on par with the well-off states.
 The states like West Bengal, Bihar, Orissa, and Assam have protested
against the uniform approach in funding because of their special
situations in which the central government has to provide special
funds to these states. Without special funding these states cannot
imagine their participation in competitive federalism.
 Though the states are provided with financial independence, it is a
fallacy to assume that all the states would perform uniformly in the
process of development because while some states have favourable
factors like skilled labour, capital and infrastructure, innovative
service industries other states lagging behind.
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 The opposition of few well-off states with respect to revenue loss in
implementation of GST system points that there is a lack of will
in participating in the process of competitive federalism.
Suggestions

 Efforts at cooperative and competitive federalism have commenced

but need to be strengthened.
 NITI Aayog concentrates on the broader policy framework instead of
micro resource-allocated functions. So there is a need to take some
further steps.
 Reactivation of the Centre-State Council: Under Article 263,
this council is expected to inquire and advice on disputes, discuss
subjects common to all states and make recommendations for better
policy coordination.
 The NITI Aayog can’t replace the council’s functions as it is the only
recognised constitutional entity for harmonising the actions of the
Centre and states. Its effective utilisation would lend legitimacy to
cooperative federalism.
 On contentious issues like land, labour and natural resources, the
state should promote best practices.
 This will enable greater investment and economic activity in states
with a favourable regulatory framework. Enactment by states must
secure expeditious Central approval.
 The World Bank’s Ease of Doing Business index reflected competition
between states has generated interest, this must be a continuing
exercise.
 But states not doing well on the index complain of infirmities of
process and procedure. These needs to be made more acceptable and
transparent.
 On issues like international treaties, WTO obligations, or the
environment an institutional mechanism must be evolved where
important decisions are appropriately discussed with states.
 As India becomes globally more interdependent, these potential
contentious issues must be resolved.

India needs a mix of Competitive and Cooperative federalism

 There needs to be a mix of competitive and cooperative federalism for

India to move ahead.
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 The future for India is cooperative and competitive federalism.
Competitive federalism provides the dynamism that needs to be
unleashed.
 We need cooperative federalism to balance competitive federalism.
 Constitution needed to catch up with economics to “favour
integration over granting sovereignty" to promote Indian internal
integration.
 GST which seeks to introduce the concept of one nation-one tax, in
order to economically unify the country for the first time, is described
this as “pooled sovereignty", which would bring a big change in the
working of federalism in the country.

Federalism in the United States

In the United States of America, though the role of judiciary regarding

the interpretation of the Constitution has not been articulated, it has
been hinted that it is responsible for safeguarding the Constitution.

In Marbury v. Madison (1803) 1 Cranch (U.S.) 137, the Supreme Court

got the chance to decide the constitutionality of legislation enacted by the
Legislature. The declaration of Judiciary Act of 1789 as ultra vires was a
turning point for Court.

At that time, the Supreme Court rose to new heights. The inclusion of the
Due Process Clause has enlarged its authority. The Court interpreted the
provisions of the Constitution in a novel manner and acted as an umpire
between the Center and State as well as the different organs. The
Supreme Court judged the authority of one organ against another,
confirmed the power of the Union against the State and guarded the
individual against infringement by the State.

Federalism in Canada

Canada is a federal system with a constitutional division of powers

between the center and provincial governments. This requires that the
courts mitigate jurisdictional disputes between the two levels of
government. It is accepted that the courts can fulfill this function only if
they are left truly independent of the governments. Hence judicial
independence is considered a fundamental constitutional principle. The
Constitution provides for security of tenure, financial security,
administrative independence, and adjudicative autonomy to ensure the
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independence of judges. This gives the judges freedom to decide without
the influence of governments or political pressure.

Conclusion

It has always been a matter of debate that whether the Indian

Constitution is federal in nature or unitary in nature. The Indian
constitution is both federal and unitary in nature, as it is a combination
of federal and unitary features. In order to get a clear picture of the
nature of the Indian Constitution, one needs to study the basic features of
the Constitution.

In a federal set-up, there is a two-tier government with well-assigned

powers and functions of all the parts. In a federal set-up, the central and
state government both work in coordination and at the same time, they
work independently. The federal polity provides a constitutional device
for bringing unity in diversity and above all for the achievement of
national goals. Prevention as well as for the betterment of conflict of the
interest of the centre and the states is an integral part of federalism and
this is the reason why Indian federalism was given a stronger centre. The
Constitution of India has adopted the federal features though it does not
claim that it establishes a federation.

The End

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