Lapse of Funds for MPLADS Projects

In News

Virtually half of a belated Rs 2,200 crore allotted for completing ongoing MPLADS (Member of Parliament Local Area Development Scheme) projects in 2020-21 simply lapsed.

About

• This happened as the Finance Ministry granted “barely a week” to the Ministry of Statistics and Programme Implementation (MoSPI) to release the funds — inviting the ire of the Standing Committee on Finance.
• Spending under the Scheme had already halved before the government suspended the scheme for two years in April last year and diverted the funds for managing the COVID-19 pandemic. 
  • From Rs 5,012 crore spent during 2018-19, expenditure of just Rs 2,491.45 crore was taken up under the scheme in 2019-20.
• After the scheme’s suspension, several MPs and parliamentary committees, including the Standing Committee on Finance (SCF), had asked the government to release MPLADS funds due from previous years for projects already sanctioned.

(Image Courtesy: TH)

Member of Parliament Local Area Development Scheme (MPLADS)

• About: 
  • The MPLADS is a Plan Scheme fully funded by the Government of India. The annual MPLADS fund entitlement per MP constituency is Rs. 5 crore.
  • It was introduced in December 1993.
  • Lok Sabha Members can recommend works within their Constituencies
  • Elected Members of Rajya Sabha can recommend works within the State of Election. 
  • Nominated Members of both the Rajya Sabha and Lok Sabha can recommend works anywhere in the country.
• Objective:
  • The objective is to enable the Members of Parliament (MP) to suggest and execute developmental works of capital nature based on locally felt needs with emphasis on creation of durable assets. 
• Administration:
  • The Ministry of Rural Development initially administered the scheme. 
  • Since October 1994 it has been transferred to the Ministry of Statistics and Programme Implementation (henceforth, the Ministry). The Ministry prepared guidelines of the scheme and amended this from time to time. 
• Development of Areas inhabited by Scheduled Caste and Scheduled Tribe: 
  • There is a greater need to develop areas inhabited by Scheduled Castes and Scheduled Tribes in order to give special attention for the infrastructure development of such areas. 
  • M.Ps are to recommend every year, works costing at least 15 percent of the MPLADS entitlement for the year for areas inhabited by Scheduled Caste population and 7.5 per cent for areas inhabited by S.T. population. 
  • In other words, out of an amount of Rs.5 crores, a M.P. shall recommend for areas inhabited by S.C. population, Rs.75 lacs and Rs.37.5 lacs for areas inhabited by S.T. population. 
  • In case there is insufficient tribal population in the area of Lok Sabha Member, they may recommend this amount for the creation of community assets in tribal areas outside of their constituency but within their State of election. 
• Infrastructure quality: 
  • All works to meet locally felt infrastructure and development needs, with an emphasis on creation of durable assets in the constituency are permissible under MPLADS. 
• Authority: 
  • It shall be the responsibility of the district authority to enforce the provision of the guideline. 
  • The extant provisions of State and Central Government’s will be used to declare areas eligible for utilization for funds meant for the benefit of SC & ST population.
  • District Collector/District Magistrate/Deputy Commissioner will generally be the District Authority to implement MPLADS in the district. 
  • If the District Planning Committee is empowered by the State Government, the Chief Executive Officer of the District Planning Committee can function as the District Authority. 
  • In the case of Municipal Corporations, the Commissioner/Chief Executive Officer may function as the District Authority. 
  • In this regard, if there is any doubt, the Government of India in consultation with the State/UT Government, will decide the District Authority for the purpose of MPLADS implementation.
• Problematic transferring Land Property: 
  • In the Tribal areas and notified Scheduled areas where transferring land title is not possible, the MPLADS works for the creation of community assets may be guided by the same practice through which the State Government undertake the creation of all other public works like schools, hospitals, roads, etc. under other Central/State Government developmental scheme. 
• Database maintenance: 
  • The District Authorities should maintain information and data on implementation of the provision for SC/ST areas including interchangeability of funds and also furnish the same on quarterly basis to the nodal department of the State Government.
• Natural & Man-made Calamities: 
  • MPLADS works can also be implemented in the areas prone to or affected by the calamities like floods, cyclone, Tsunami, earthquake, hailstorm, avalanche, cloud burst, pest attack, landslides, tornado, drought, fire, chemical, biological and radiological hazards.
• Rehabilitation Works: 
  • The Nodal Department shall identify the rehabilitation works within a period of one month of commitment of MPLADS funds and the rehabilitation works should be completed by the concerned District Authority within 8 months of the approval of the works. 
  • In the event of “Calamity of severe nature” in any part of the country, an MP can recommend works up to a maximum of Rs.1 crore for the affected district. 
  • Whether a calamity is of severe nature or not, will be decided by the Government of India. The funds in this regard will be released by the District Authority of Nodal district of the MP concerned to the District Authority of the affected district to get permissible works done. 

Significance

• The entire population across the country stands to benefit through the creation of durable assets of locally felt needs, namely drinking water, education, public health, sanitation and roads etc.
• Until 2017, nearly 19 lakh projects worth Rs 45,000 crore had been sanctioned under the MPLAD Scheme. 
• Third-party evaluators appointed by the government reported that the creation of good quality assets had a “positive impact on the local economy, social fabric and feasible environment”. 
• Further, 82% of the projects have been in rural areas and the remaining in urban/semi-urban areas.

Challenges

• Unwise Allocation of Funds: Most of the MPs while allocating funds to individual works seem to be thrifty, despite the fact that there is a large unspent balance of MPLADS.
• Maintenance of assets: Maintenance of assets created is another area of weakness of the scheme. This seems to have received less attention than it deserves. 
• Monitoring: It is difficult to assess the design, implementation and impact of the scheme, and identify the areas of its weakness, and strength. 
• Corruption associated with allocation of works: The Comptroller and Auditor General has on many occasions highlighted gaps in implementation.
• Against Spirit of Constitution: It is inconsistent with the spirit of the Constitution as it co-opts legislators into executive functioning. The workload on MPs created by the scheme diverted their attention from holding the government accountable and other legislative work. 
• Awareness about scheme: There is a widespread lack of awareness about the scheme among the people. Awareness among the people is must for successful implementation of the scheme.
• Various Recommendations: The National Commission to Review the Working of the Constitution (2000) and the Second Administrative Reforms Commission (2007), recommended discontinuation of the scheme. In 2010, the Supreme Court held that the scheme was constitutional. 

Way Forward

• There is a need to make the fund lapsable. If the concerned MP fails to recommend enough works to cover the substantial part, say 80 percent, of the fund for the year the unspent balance may be returned to the Ministry at the Centre.
• The State nodal departments will need to be strengthened in terms of staff and other infrastructure. 
• At the ground level, the PRIs may be involved in execution as well as in monitoring to a larger extent. 
• The Collector may continue to receive funds from the Ministry and recommendation of works from MPs.
• To avoid inadequate allocation of funds for individual works, the asset intended to be created may be described in more detail so that its cost implication is clear. The MP may consider allocation of funds only after the cost estimate is prepared and the detailed work plan and coordination mechanism are made available to him. 

Source: TH