Housing subsidy to go directly to beneficiaries

"It is observed that states/union territories follow different methods for disbursing funds to the IAY beneficiaries. While most states pay by way of cash/cheques/demand drafts, others transfer funds directly to the accounts of the beneficiaries," said an official.

With these different modes of payment leading to difficulty in monitoring, the ministry has now decided to follow a uniform model.

This move, the ministry says, will stop misuse of funds. "Since cash payments and uncrossed cheques may result in leakages and diversion of funds, it has been decided that henceforth, funds under the IAY should be transferred directly into the beneficiaries' accounts," said the official.

The ministry has asked states to ensure opening of bank or post office accounts "in case they (beneficiaries) do not already have one and to intimate the account number to gram sabhas, block development officers or district rural development agencies."

The scheme, funded 75 per cent by the Centre, provides subsidy to the rural poor for building houses.