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Changes in MPs’ fund to be debated

Changes in MPs’ fund to be debated
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First Published: Fri, Dec 17 2010. 11 29 PM IST
Updated: Fri, Dec 17 2010. 11 29 PM IST
New Delhi: The government is considering significant changes in the programme under which funds are given to members of Parliament (MPs) for spending on the development of their constituencies, using part of the money in the Centre’s rural jobs guarantee programme.
The Central government will hold a national consultation on Monday to revise guidelines for the Member of Parliament Local Area Development Scheme (MPLADS). Among the proposals on the table are converging MPLADS with the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS), and giving a greater role to non-governmental organizations (NGOs).
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Such a debate assumes significance amid the raft of corruption allegations that has put the government on the defensive recently. The Bihar cabinet recently scrapped the state’s version of the scheme, saying the funds allocated for the purpose were being misused.
The scrapping of the scheme was recommended in 2009 by the Administrative Reforms Commission under M. Veerappa Moily, at present the law minister, which held that the scheme eroded the notion of separation of powers as the legislator directly becomes the executive in the use of the funds.
The Comptroller and Auditor General (CAG) is currently carrying out another audit of the scheme. In an audit of the scheme over 1997-2000, the government auditor had said the programme didn’t serve its main objectives. It said the utilization of funds had worsened since its last audit for 1993-1997. It also pointed out the poor record on work being completed under the scheme.
The Supreme Court, however, in a judgement in May upheld the constitutional validity of the scheme.
MPLADS was started in December 1993 with the objective of enabling MPs to recommend developmental work with an emphasis on creating durable community assets in their constituencies, such as drinking water, primary education, public health, sanitation and roads.
Initially, MPs were allotted Rs 5 lakh per year, which was later increased to Rs 1 crore, and subsequently to Rs 2 crore in 1998-99. Legislators belonging to both the Lower House and the Upper House have recently demanded an increase in the funds to Rs 5 crore per year.
The proposal to converge MPLADS with MGNREGS, mooted by the ministry of rural development, was at first rejected by the ministry of statistics and programme implementation (Mospi), the implementing authority of the scheme, on the ground that the two are quite divergent.
However, the rural development ministry asked Mospi to reconsider the matter and allow utilization of MPLADS funds on public utility buildings taken up under MGNREGS in rural areas.
Under the proposal, the material cost in building community centres known as Bharat Nirman Rajiv Gandhi Sewa Kendras under MGNREGS will be sourced from MPLADS, while the cost of labour will be sourced from the job guarantee scheme.
The sewa kendras are meant to provide space to facilitate the functioning of the MGNREGS office at the village council and block levels, and to function as knowledge resource centres to facilitate citizens’ access to information about the scheme and other rural development programmes.
MGNREGS, the flagship welfare programme of the Congress-led United Progressive Alliance government at the Centre, guarantees 100 days of manual work a year to each rural household. It has so far benefited 37.1 million households in 619 districts and has a budget of Rs 40,100 crore in the current fiscal to March.
The permissible maximum cost for building the sewa kendras at the village council level is Rs 10 lakh and at the block level is Rs 25 lakh under the MGNREGS scheme.
However, differences in the way the two schemes are implemented may create problems over their convergence. MPLADS guidelines stipulate that wherever such pooling is done, money from other scheme sources should be used first and the MPLADS cash should be released later, so that it helps in finishing the work.
Under MPLADS, tendering is the norm, unlike in MGNREGS, where it is not required. Further, under MGNREGS, the wage-material ratio has to be maintained at 60:40, whereas under MPLADS, there is no such stipulation.
The Monday meeting, which will be attended by state government representatives as well as district collectors, will brainstorm on how to converge these differences between the two schemes.
“The consultation will look into whether or not MPLADS is creating assets of any use and try to get a fix on that,” said principal advisor to the Planning Commission Pronab Sen.
Sen said the proposal to converge MPLADS with MGNREGS is welcome as the cost of labour and material could be separately shared by the two schemes. However, he said there could be organizational problems at the public works development level in converging the two schemes.
Yamini Aiyar, a senior research fellow and director of the accountability initiative, Centre for Policy Research, said the fundamental problem with convergence of MGNREGS with any other scheme is that it does not address local infrastructure needs.
“Convergence of this kind leads to centralized decision making, which curbs the entire idea of decentralization, as envisaged by the (MGNREGS) scheme,” she said.
Ruhi Tewari contributed to this story.
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First Published: Fri, Dec 17 2010. 11 29 PM IST