Madhya Pradesh Chief Minister Shivraj Singh Chouhan has written to Prime Minister Narendra Modi to allow up to 60 per cent of the MNREGA outlay to be used for material costs so that productive assets are created. He has also asked the NDA government at the Centre to prune the number of centrally sponsored schemes and lend more flexibility to states to conceive custom-made schemes.
In an interview to The Sunday Express, Chouhan said, “We need to create permanent assets. At present, the labour component consumes 60 per cent of the outlay, leaving only 40 per cent for materials. We have asked the PM to change it to 40:60 (40 per cent labour, 60 per cent materials) or at least 50:50.”
Chouhan travelled to Mumbai and Delhi recently to pitch Madhya Pradesh as a leading investment destination to companies. He also addressed CEOs at a Confederation of Indian Industry-organised meeting in Mumbai.
According to Chouhan, there is considerable scope to use funds for the job guarantee scheme MNREGA in agriculture and other rural sectors.
“Agri labour does not come easily. For works like constructing school buildings, etc in rural areas, MNREGA funds can be used if the split between material and labour costs is changed,” he said.
The Madhya Pradesh government has contended that a higher material component can enable the state to use steel and cement in MNREGA works, which is currently not possible.
Chouhan has also requested Modi and the Fourteenth Finance Commission chaired by former RBI governor Y V Reddy to increase the states’ share in Central taxes to 50 per cent from the current 32 per cent.
“We need to sharply reduce the number of centrally sponsored schemes (CCS). This will help states get more funds so they can introduce schemes catering to their specific needs,” he said. The CM said CSS often begin with the Centre contributing as much as 90 per cent of required funds, but this reduces over a period of time, shifting the burden almost entirely to states.