As a recent development, the Ministry of Finance’s (Department of Expenditure) decision to give the Ministry of Statistics and Programme Implementation (MoSPI) merely one week for funding ongoing Member of Parliament Local Area Development Scheme (MPLADS) projects has been critiqued by the Standing Committee on Finance. Due to this hasty decision-making, 50% of the allocated funds were not utilized within the stipulated period.
Key Findings: The Detrimental Impact on Projects
The Committee highlighted that the unexpected funding crunch caused by such short notice significantly impacted numerous local area developmental initiatives across India. Particularly, those states which underwent elections this year were left worse off, as no funds were disbursed for them citing the Model Code of Conduct.
Policy Ad-hocism and Its Reverberation
Normally, funds allotted to district authorities under MPLADs don’t expire, and those not furnished by the government in a particular year roll over to the next. However, the current scenario where the Ministry of Finance has allowed funds to lapse constitutes a display of ad-hoc policy-making and constitutes a serious fiscal management error with negative repercussions for Indian communities.
About the MPLAD Scheme
Introduced in December 1993, MPLAD is a Central Sector Scheme designed to empower MPs to suggest and execute capital developmental works based on local needs, focusing primarily on creating durable assets. Initially, the scheme was administered by the Ministry of Rural Development before being transferred to the MoSPI in October 1994.
Understanding the Functioning of the Scheme
Under this scheme, each MP receives Rs. 5 crores annually, amounting to Rs. 3,950 crores for 790 MPs, for implementing development projects in their respective constituencies. For Lok Sabha and Rajya Sabha MPs, the criteria for project recommendation differ slightly based on their election scope.
Favored Projects under the Scheme
The projects typically cover asset creation in sectors such as drinking water facilities, primary education, public health sanitation, and road development. Since June 2016, MPLAD funds have also been employed for implementing schemes like Swachh Bharat Abhiyan, Accessible India Campaign (Sugamya Bharat Abhiyan), rainwater harvesting and conservation, and Sansad Aadarsh Gram Yojana among others.
Issues Associated with MPLADS
Despite its intent, the implementation of MPLADS has seen several issues crop up. The Comptroller and Auditor-General of India (CAG) has flagged instances of financial mismanagement along with artificial inflation of amounts spent. Furthermore, the absence of a statutory law governing the scheme leaves it susceptible to the changing moods of the ruling government. There is also no available indicator to measure the level of participation in this supposedly participatory development scheme.
Legal and Constitutional Conflicts
There have also been arguments suggesting MPLADS may breach constitutional norms. As per the seventh schedule, the union government can incur expenditure only over matters within its domain. Critics argue that MPLADS intrudes on the territory of local self-governing institutions, thus violating Parts IX and IX-A of the Constitution. It’s also noted that the scheme disrupts the doctrine of separation of powers by involving MPs in executive functions. These are some of the legal and constitutional issues which add complexity to the MPLAD scheme.
