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Rural Ministry spending hits new low in FY26: Data
Before 2017-18, the government accounts had two separate heads — plan and non-plan expenditure. Ministry-wise details are available only for plan expenditure.
With sluggish spending, the ministry may not be able to spend its entire allocation as the Finance Ministry’s norms expect ministries to avoid “rush expenditure” in the last quarter of an FY.
The expenditure by the Rural Development Ministry, which implements vital schemes like the MGNREGS, PM Awaas Yojana (Gramin) and PM Gram Sadak Yojana, witnessed a sharp decline with government data showing that in the first nine months of the current fiscal, only 51% of the budgetary allocation was utilised, the lowest in 9 years, compared to 63% in the last fiscal during the same period.
In absolute terms, the ministry’s spending of Rs 97,125 crore in the first nine months, was lowest in the last six years.
According to the Union government’s monthly accounts data, the Rural Development Ministry has been witnessing a constant decline in spending in the first three quarters (April-December) of a fiscal year since 2020-21 but hit a lowest in the current fiscal year. (See chart)
As per Controller General of Accounts (CGA) portal data, the ministry could spend only 51% or Rs 97,125.88 crore of its overall budgetary allocation of Rs 1,90,405.53 between April and December of FY 2025-26, the lowest since 2017-18, the earliest year for which comparable figures are available.
Before 2017-18, the government accounts had two separate heads — plan and non-plan expenditure. Ministry-wise details are available only for plan expenditure.
According to sources, one of the key reasons for reduction in expenditure is Finance Ministry’s new spending norms in 2023-24, which include implementing SNA SPARSH (Samayochit Pranali Ekikrit Sheeghra Hastaantaran) — a cash management initiative for Centrally Sponsored schemes (CSS) fund flow mechanism. Within SNA SPARSH, funds are released by the Centre under specific programmes only after the state provides its share within the respective scheme.
Another reason, sources said, was lower spending on the MGNREGS. During the current FY, the MGNREGS expenditure was recorded at Rs 65,124.44 crore during the first nine months, compared to Rs 81,037.65 crore in the same period of 2024-25 and Rs 82,343.9 crore in the corresponding period of 2023-24.
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Sources said that other rural development schemes like PM Awaas Yojana-Gramin (PMAY-G) and PM Gram Sadak Yojana (PMGSY) too have seen a slowdown in spending during the current FY, and due to which the ministry’s overall budget has seen a downward revision at the revised estimate (RE) stage.
In December 2025, the NDA government enacted the VB—G RAM G Act, 2025, replacing the MGNREGA.
The allocation to the ministry, which comprises the departments of rural development and land resources, accounted for 4.2% of the total expenditure of the Centre. It implements several poverty alleviation and social security initiatives including MGNREGS, PMAY-G, PMGSY, Deen Dayal Upadhyaya Grameen Kaushalya Yojana (DDU-GKY) and National Social Assistance Programme (NSAP).
With sluggish spending, the ministry may not be able to spend its entire allocation as the Finance Ministry’s norms expect ministries to avoid “rush expenditure” in the last quarter of an FY.
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In FY 2025-26, the Centre has allocated Rs 86,000 crore for the MGNREGS, Rs 54,831.99 crore for PMAY-G, and Rs 19,000 crore for PMGSY.
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