'Difficult for Finmin to hike MPLAD allocation to Rs 25 cr'

New Delhi, Jul 20: A proposal for five-fold increase in annual allocation under the Member of Parliament Local Area Development scheme from Rs 5 crore to Rs 25 crore has not found favour with the Finance Ministry, Parliament was informed today.

"Finance Ministry gave its comments on the proposal on June 13, 2016... The enhancement requested would entail a five fold increase resulting in annual budgetary allocations totalling Rs 19,750 crore (against Rs 3,950 crore at present).

It would be difficult to make such provisions," stated Statistics Minister D V Sadananda Gowda in a written reply to Lok Sabha today. Finance ministry has also said: "While the increase from Rs 2 crore to Rs 5 crore (2½ times) was after 12 years, the present request for 5 fold increase is after only 5 years.

"The audit reports, results of evaluation of the scheme, the utilisation of funds released till now for the scheme, the unspent balances lying in the field, etc. have to be carefully considered, while keeping in view the constraints in the availability of resources with the Central Government."

Gowda said there is no proposal in the ministry to increase the annual allocation of MPLADS funds. However, he stated that Lok Sabha Committee on MPLADS in its sitting held on July 2, 2013 had recommended to increase the annual allocation per MP to Rs 10 crore.

After that Deputy Speaker Lok Sabha and Chairman, Lok Sabha Committee on MPLADS in a letter dated February 25, 2015 had requested for increase of annual allocation of MPLADS funds per MP to Rs 25 crore.

The minister also told the house that the government released Rs 858 crore in the current fiscal till June end, while the unspent amount was 4,963.77 crore under the MPLAD scheme. About Rs 997.50 crore was utilised under the MPLAD scheme till June end this fiscal.

The minister said funds under the MPLAD scheme are non-lapsable, both at the end of the Union Government and at the end of the District Authority and the unspent balances of a particular year are utilised in the subsequent years.

In view of the nature and dynamics of the scheme, the unutilised balances, which also include interest accrued, are bound to exist at any given point of time and utilisation of MPLADS funds in the same financial year is not feasible, he added.

During 2015-16, an amount of Rs 3,502 crore was released while Rs 3,628.01 crore was utilised. The unspent balance in the MPLAD scheme was Rs 4,947.13 crore at the end of last fiscal.

PTI