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Reconsider MGNREGA budget cuts: Jairam to PC

Ramesh called the proposed cut for NRLM from Rs 4000 crore to Rs 2,600 crore “unjustified”.

Asking him to reconsider budget cuts for the government’s flagship social sector schemes,including guranted work for people in rural areas under the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA),Rural Development Minister Jairam Ramesh has written to Finance Minister P Chidambaram expressing concern that the “huge cuts” proposed will “very severely affect these programmes particularly in states that need them the most”.

Ramesh has highlighted scheme-wise issues for the Finance Ministry to an “informed and well-considered decision”. Wiith Lok Sabha polls due next year,and given the Congress-led UPA’s emphasis on welfare schemes,particularly in rural areas,the proposed cuts are being seen as a significant issue.

The Finance Ministry suggested cuts in Revised Estimates for key flagship schemes falling under ministries such as Rural Development,Human Resources Development and Health. This was seen as an attempt to rein in fiscal deficit.

The cuts would affect four key flagship schemes MGNREGA,Indira Awas Yojana (IAY) for rural housing,Pradhan Mantri Gram Sadak Yojana (PMGSY) for rural roads and the recent National Rural Livelihoods Mission (NRLM) for improving livelihoods of people in rural areas the Rural Development Ministry hosts.

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The reason cited for the proposed cuts is “substantial unspent balances lying with the state” but Ramesh said it is “not proper to assess unspent balances at this juncture”. According to the minister,there is a minimum float available with state governments at any given point of time for them to implement programmes in an effective manner. He emphasized that all rural development programmes are linked to work season and “nearly two full months of peak work season” have been lost this year because of the “unusually long monsoon”.

According to Ramesh,given MGNREGA is demand-driven and not allocation-based,“Finance Ministers must necessarily find resources required for implementation come what may”.

Ramesh called the proposed cut for NRLM from Rs 4000 crore to Rs 2,600 crore “unjustified” given the programme’s “social and economic significance for the bottom half of India’s population”,and suggested a maximum cut of Rs 500 crore,if needed. He said IAY requires additional funds and the Finance Ministry proposal of a Rs 2,000 crore cut is not feasible. For PMGSY,Ramesh expressed was willing for a Rs 8,000 crore cut against the proposed Rs 12,000 crore.

First published on: 27-11-2013 at 12:22:39 am
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