Funds slashed for flagship programme MGNREGA
The budget focuses on rural development with a moderate hike in allocation, but the government has downsized in a big way the importance of its flagship programme, the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), on which it reportedly galloped to power in 2009.
For the scheme entitling jobs to below poverty line (BPL) households in rural areas, the allocation has been reduced by 17.5 per cent to only Rs. 33,000 crore in the next financial year from Rs. 40,000 crore in 2011-12.
The reduction comes against the backdrop of the poor performance of the scheme and demands by the Agriculture Ministry, which the Economic Survey released on Thursday echoed, for a moratorium during agriculture season on the ground that it deprived availability of labour.
Finance Minister Pranab Mukherjee has also revised the current year's allocation to Rs. 31,000 crore, a tad higher than the release of just Rs. 24,722 crore till February-end, while the expenditure by the States stands at Rs. 24,106 crore. Only 4.09 crore households have been provided with jobs till mid-February, against the 5.49 crore households that availed jobs under the scheme in 2011-12.
Notwithstanding this cut, the allocation for various programmes that spearhead rural development has been increased to Rs. 98,900 crore from Rs. 91,301 crore in 2011-12 for a 6 per cent increase by Rs. 7,599 crore. This budgetary allocation is next only to the allocation to the Defence Ministry.
Minister of Rural Development Jairam Ramesh clarified that the government was committed to meeting any demand for job and money would be provided as and when required by the States. He maintained no jobs would be denied and the demand could have gone down because of good monsoon and the lack of capacity of the gram panchayats to spend the money demanded under the labour budget proposed by the States, which too could have been overestimated.
The budget concentrates on drinking water and sanitation, construction of rural roads, houses, self- employment opportunities, including through self-help groups (SHGs) and increased pension for widows and disabled persons.
For drinking water and sanitation, the allocation has been increased to Rs. 14,000 crore from Rs. 11,000 crore for a 27 per cent increase, though for current year, the allocation has been revised downwards to Rs. 10,000 crore.
The focus on cleanliness and providing toilets gained momentum in the light of the recent disclosure that about 50 per cent of the rural population practice open defecation that even affected their health.
Mr. Ramesh's thrust for supply of quality water has been accepted and the budget has sanctioned the establishment of a water quality centre in Kolkata at an estimated cost of Rs. 50 crore. The West Bengal has decided to provide 2.5 to 3 acre of land for the purpose.
The allocation under the Pradhan Mantri Gram Sadak Yojana has been increased from Rs. 20,000 crore to Rs. 24,000 crore in 2012-13 for a 20 per cent hike to increase road connectivity in rural areas.
For construction of rural houses under the Indira Aawas Yojana (IAY), the allocation has been increased by over 10 per cent to Rs. 10,000 crore from Rs. 9,000 crore.
For the integrated watershed programme under the Land Resources Department, the allocation has been raised from Rs. 2,294 to Rs. 2,745 crore. The allocation to the National Rural Livelihood Mission, which is likely to be renamed as "Aajeevika" has been increased by 34 per cent from Rs. 2,914 crore in 2011-12 to Rs. 3,915 crore next year.
The government proposes to set up a Bharat Livelihoods foundation of India to support and scale up civil society initiatives in 170 tribal districts. Private trusts and organisations will contribute to the corpus to be set up with an initial government contribution of Rs. 500 crore.
Mr. Ramesh said he would be ensuring a private contribution of a similar amount and the interest earned will be used to help NGOs.
The Centre has decided to provide loans up to Rs. 3 lakh to women SHGs at a subsidised rate of 7 per cent and an additional subsidy of 3 per cent to those who return it timely. In the first phase, it will be implemented in 600 blocks of 150 districts, including the left-wing extremism affected districts.
On the social security front, the government has increased the pension of widows and disabled persons from Rs. 200 to Rs. 300 a month under the Indira Gandhi national Widow Pension Scheme and the Indira Gandhi National Disability Pension Scheme for BPL beneficiaries.
Both the schemes are covered under the National Social Assistance Programme, the allocation for which has been enhanced by 37 per cent from Rs. 6,158 crore to Rs. 8,447 crore in 2012-13 to meet the raised pension.
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