TOPIC : AN ANALYSIS OF THE MPLAD SCHEME

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THE CONTEXT:  MPLAD scheme was introduced in 1993. The purpose of the Scheme was to enable MPs to create durable assets based on local requirements of their respective constituencies. The Scheme is administered as per guidelines issued from time to time. Revised guidelines has been issued on March 14 2023, is based on the experience gained over nearly 30 years. This article analyses various aspects related to the MPLAD scheme.

ABOUT MPLAD SCHEME

• The MPLAD Scheme is a Central Sector Scheme fully funded by the Government of India. This Scheme was announced on December 23, 1993
• In 1993-94, when the Scheme was launched, each Member of Parliament was allocated an amount of Rs. 5 (five) lakh per annum, which was enhanced to Rs.1 (One) crore per annum in 1994-95, and further to Rs. 2 (two) crore per annum in 1998-99 and it is currently fixed at Rs. 5 (five) crore per annum w.e.f. the financial year 2011-12.
• In the wake of the COVID pandemic, MPLADS was suspended from April 6, 2020 to November 9, 2021, and no funds were allocated to the Scheme for FY 2020-21. For the balance period of FY 2021-22, i.e., from November 10, 2021 to March 31, 2022, Rs. 2 Crore was allocated under the Scheme for each Member of Parliament.
• Lok Sabha Members can recommend works within their Constituencies and Elected Members of Rajya Sabha can recommend works within the State of Election (with select exceptions). Nominated Members of both the Rajya Sabha and Lok Sabha can recommend works anywhere in the country.
• MPs are to recommend every year, works costing at least 15 per cent of the MPLADS entitlement for the year for areas inhabited by Scheduled Caste population and 7.5 per cent for areas inhabited by ST population.
• The funds under MPLADS are non-lapsable both at the end of the Union Government and at the end of the District Authority. The unspent balances of a particular year are utilized in the subsequent year(s).

IMPLEMENTATION OF THE SCHEME

• A Member of Parliament shall give his/ her choice of Nodal District in a prescribed format to the Ministry of Statistics and Programme Implementation with copy to the State Government and to the District Magistrate of the chosen District.
• The annual entitlement of Rs 5 crore shall be released, in two equal instalments of Rs 2.5 crore each, by Government of India directly to the District Authority of the Nodal District of the Member of Parliament concerned.
• Each MP shall recommend eligible work on the MP’s letter head duly signed by the MP to the district authority.
• The District Authority shall identify the Implementing Agency capable of executing the eligible work qualitatively, timely and satisfactorily. It shall be responsible for timely and effective implementation of such works. All recommended eligible works should be sanctioned within 75 days from the date of receipt of the recommendation, after completing all formalities. The District Authority shall, however, inform MPs regarding rejection, if any, within 45 days from the date of receipt of recommendations, with reasons thereof.
• MPLAD Scheme can be converged in individual/stand-alone projects of other Central and State Government schemes provided such works of Central/State Governments Schemes are eligible under MPLADS. Funds from local bodies can similarly also be pooled with MPLADS works. Wherever such pooling is done, funds from other scheme sources should be used first and the MPLADS funds should be released later, so that MPLADS fund results in completion of the project.
• As soon as a work under the Scheme is completed, it should be put to public use. For greater public awareness, for all works executed under MPLADS a plaque (stone/metal) carrying the inscription ‘Member of Parliament Local Area Development Scheme Work’ indicating the cost involved, the commencement, completion and inauguration date and the name of the MP sponsoring the project should be permanently erected.

BENEFITS OF THE SCHEME

• Creation of the Durable assets: The entire population across the country stands to benefit through the creation of durable assets (at local level) like drinking water, education, public health, sanitation and roads etc, under MPLAD Scheme.
• Rural empowerment: Under the Scheme, over 19 lakh projects worth Rs 45,000 crore had been sanctioned, of which 82% of the projects have been in rural areas.
• Address the resource Crunch in District: Utilising MPLADS funds for priority areas will help in addressing, partly, the resource crunch of the districts.
• Collaborative synergies: It also helps pave the way for the much-needed collaborative synergies between the political representative and the administration on the ground to augment basic health care facilities in rural areas.
• Strengthen the Confidence of people in elected representatives: MPLADS not only address the human capital needs of rural societies at large — but also restore the faith and confidence of citizens in their elected leaders.

ISSUES RELATED TO THE MPLAD

• Corruption:  There have been cases of widespread corruption and misappropriation of funds. In a lot of cases, private contractors (which are not permitted) are engaged to implement the works. Also, there have been instances where expenditure has been incurred on works which are prohibited under the Scheme.
  1. It is widely alleged that MPs use these funds and get a percentage as commission.
  2. The MPs are alleged to use this avenue to enrich themselves. There seems to be no local development but only self-development of MPs.
• Funding:  There are large amounts of unspent balances rising over the years, as the Comptroller and Auditor General of India observed that there is low utilisation of funds and an expenditure bias towards a particular sector.
• Administration of the Scheme: There were many lacunas in the administration of the Scheme at the ground level and often the MPs have deviated from the original purpose of the Scheme. MPLAD funds were mostly underutilised and misused. Reports from the Comptroller and Auditor General (CAG) list out various lapses in the implementation of the Scheme. The CAG observed flouting of rules and corruption while implementing the Scheme.
•  Delivery: There are weaknesses in the process of sanction. The District Authorities tend to execute works without receiving any recommendations from MPs concerned or on the recommendation of the representatives of the MPs rather than the MPs themselves.
• Lapses on the monitoring and supervision front: District Authorities failing to inspect the required number of sanctioned works as well as in sending regular monitoring reports.
• Sustainability of the Scheme:  There have been charges that the Scheme goes against the spirit of the 73rd and the 74th Amendment, with MPs enjoying the privilege of an uninterrupted yearly flow of funds to do the work that local bodies are better placed to deliver. The constitutionality of the Scheme has also been questioned as 2nd ARC stated that Scheme erodes the notion of separation of powers, as the legislator directly becomes the executive.
• Lack of Data to the MPs: Lack of adequate information available to MPs, which sometimes leads to a disproportionately large amount of money flowing into one district. There also seems to be an absence of a proper mechanism to ensure constituent participation in order to determine locally felt needs, leaving open the possibility of a small group, having easy access to the MPs, impressing upon him to recommend works according to their needs.
• Handing over of assets and assets not put to use : The Scheme mandates that as soon as a work is completed, it should be transferred to the user agency for public use. Out of the 15,049 sample works created during 2004-09, handing over was not on record for 14,828 cases, which is 98.53 per cent of the works created.
• Use of funds to woo voters: A study published in 2017 shows that during the period from 2009 to 2014, MPs irrespective of party ideology, spent less in the beginning of the term. Majority of the unspent balance and new funds were spent in the last year of the term. This enables them to spend the amount just before the general election to woo the voters with some pet scheme.

Best Practices

• ‘One MP-One Idea’ competition initiated in Kottayam Lok Sabha constituency;’
• In this three most innovative ideas from the local people on development projects will be awarded cash prizes.
• The objective of the initiative is to ensure development through people’s participation. The best project idea will get a cash award of `2.5 lakh and second and third winners will get `1.5 lakh and `1 lakh through the MP’s local area development (MPLAD) funds.

THE WAY FORWARD

• Regular Monitoring: There is a need for a greater focus on regular monitoring by the District Authorities. The practice of random inspections by the District Authority, both before the release of the second instalment and after the completion of the work, is a good practice followed in Varanasi.
• Assessing the need of the People: In order to better assess the needs of the constituents, surveys can be conducted across the constituency. For this purpose, NGOs and local community can be involved. Once the needs of the constituency are determined, implementation can be linked to what’s needed.

• Assessment of the Scheme:  For the Scheme to be more effective, an impact assessment study should be undertaken at the constituency level, on a yearly basis, to assess the benefits of the works implemented to the community at large.
• Making the fund lapsable: To tackle the issue of large unspent balances which have accumulated and are rising over the years, funds can be made lapsable. This way funds lying unused can be put to other uses.

THE CONCLUSION: MPLAD scheme is a unique scheme however it has faced various lacunae in the Scheme. Thus, there is a need to improve the functioning of the MPLAD Scheme so that more efficient use of the funds can be ensured. With more efficient use of the Scheme, the bonding of the elected representative and people will increase thereby strengthening the democratic system which is the core feature of the political system of the country.