MGNREGA spending at record high, no cut in allocation: FM

Said this fiscal the government has not cut Plan Expenditure as it wants to boost growth

The BJP-led government has boosted spending under the UPA's flagship rural jobs scheme MGNREGA to a record high and will for the first time ever provide funds over and above the budgeted amount, Finance Minister Arun Jaitley said today.

Dispelling doubts over the fate of the scheme floated by the previous Congress-led government, he said that while in previous years there has always been lower spending as compared to the Budgeted amount, this fiscal the government has not cut Planned Expenditure as it wants to boost growth.

Addressing a MGNREGA Sammelan organised to mark the completion of 10 years of the scheme, Jaitley said there were apprehensions that the NDA government would end or replace the scheme with a new programme.

"But the new government has not only taken the scheme forward, but also hiked the fund allocation under the scheme," he said.

"This government has not followed the practice of just making higher provisions and later cutting it. I think this would be the first year when the Rs 34,000-35,000 crore which was allocated has not only been spent fully, but also some more resources could be given to MGNREGA".

The Finance Minister said the actual spending under the scheme in the fiscal year ending March 31 "would be highest".

"This country's financial system had a practice that when a Budget is presented, people discuss how much money has been allocated. But in full year, how much money is spent and by how much the allocation is cut, that doesn't attract attention," he said.

There was not a single year in recent past when Budget allocations were not cut, he said, adding that it was a practice to reduce allocations every November-December.

"And the effect of this was that there was less spending and when there is less expenditure on economic development (and) cut in plan expenditure, it impacted economic growth," he said.

Jaitley said 2015-16 "will be the first year when there would be no cut in funds allocated for development works. Actual spending would be more than the provisions made in the Budget."

Yesterday, opposition Congress had dubbed as "better late than never" the Narendra Modi government's praise of MGNREGA saying "it shows how the landmark legislation has changed the lives of the rural poor".