MPLAD schemes: Detractors warn of eroded separation of powers in governance

Thirty-one years after it was launched, the relevance of the Member of Parliament Local Area Development Scheme (MPLADS), and similar schemes that legislative assemblies, municipalities and panchayats initiated in its wake for their respective elected representatives, remains contested.

 

The detractors of these schemes contend that they erode the constitutional principle of separation of powers between the executive and the legislature, and that a robust mechanism to monitor the utilisation of public money under these schemes is absent. The supporters of these schemes, primarily elected representatives, argue that the schemes allow them to direct resources according to the needs of their constituents.

 

“The MPLAD and similar schemes are misconceived. They violate the constitutional spirit of separation of power between the executive and the legislature,” says Association of Democratic Reforms (ADR) founder Jagdeep Chhokar. Moreover, he says, monitoring and evaluation of the funds spent under these schemes is lacking.

 

Critics point out that rarely are questions asked and probes ordered on the utilisation of public money under these schemes, or when done, it is mostly to settle political scores around election time. For example, on Monday, according to local media reports, Congress’ Saleng A Sangma, the debutant Lok Sabha member from Meghalaya’s Tura, reportedly emerged appalled from a review meeting of the state-level monitoring committee that several projects undertaken under MPLAD scheme in his constituency were incomplete after two decades.

 

“Twenty-two years is not a joke. Several projects have been pending from 2002. I don’t want to blame anyone at the moment, but the delays could be due to wrong beneficiaries chosen by my predecessors,” Saleng said. When Business Standard reached out to Saleng over phone on Tuesday, he described his flagging of irregularities in the MPLAD scheme in Tura a “small matter” involving “meagre amounts”, which should not take away from the importance of MPLAD. He said the annual allocation of Rs 5 crore to MPs under MPLAD was fixed a decade back and needed to be increased.

 

There is, however, political subtext involved in Saleng alleging irregularities in the utilisation of funds by his predecessors. Saleng was a legislator from the Gambegre Assembly seat in 2013, 2018 and 2023, which is now slated for a bypoll on November 13 since he quit the seat after getting elected to the Lok Sabha. Among the contestants is the ruling National People’s Party (NPP)’s Mehtab Chandee Sangma, wife of Chief Minister Conrad Sangma. In the 2024 Lok Sabha polls, Saleng defeated sitting MP Agatha Sangma, a former Union minister and Conrad’s sister. The family held that seat successively from 1991 to 2019, beginning with their father, former Lok Sabha Speaker, the late Purno Sangma. 

 

There is also a race among states and Union Territories (UTs) to increase the allocation under these schemes. Last month, with an eye to the forthcoming Assembly polls in February, the Aam Aadmi Party (AAP)-led Delhi cabinet increased the MLA Local Area Development, or MLALAD, fund from Rs 10 crore per year, which was already the highest in the country, to Rs 15 crore for each of its 70 MLAs. The Opposition Bharatiya Janata Party (BJP) alleged that the increase to Rs 15 crore was “more likely to be misused” by AAP legislators. AAP has blamed the Lieutenant Governor (LG) and his “favourite officers” for the lack of civic works in Delhi.

 

At Rs 1,050 crore budgetary allocation, Delhi's spend on its MLALAD will be the third most in the country. Uttar Pradesh with Rs 5 crore each for 403 MLAs under its MLALAD has an annual allocation of Rs 2,015 crore, followed by Maharashtra's Rs 1,440 crore, with Rs 5 crore each for its 288 legislators. Haryana legislators earlier had Rs 5 crore fund each, which was scrapped in 2019. In Punjab, CM Bhagwant Mann proposed a Rs 10 crore fund, but the state’s high debt, at Rs 3.5 trillion, has meant the scheme is yet to be introduced.

 

The increasing allocation to state legislators under MLALAD had North Chennai MP Kalanidhi Veerasamy write to Finance Minister Nirmala Sitharaman in July, requesting that the MPLAD be increased to Rs 15 crore annually from Rs 5 crore, and projects undertaken exempted from GST. He reasoned that MPs represented two million people while MLAs in several states get either an allocation equal to or more than MPs under these schemes when they represented barely 200,000-300,000 electors.

 

Monitoring mechanisms

 

The Comptroller and Auditor General (CAG) of India has in the past pointed out irregularities in the implementation of these schemes. In one of its reports, it noted that there is “no accountability for the expenditure in terms of the quality and quantities executed against specifications”, etc.

 

But over the years, the Union Ministry of Statistics and Programme Implementation (MoSPI) has been getting periodic third-party evaluation of MPLAD Scheme done. According to a parliamentary panel report, the National Bank for Agriculture and Rural Development Consultancy Services (NABCONS) conducted third-party monitoring of MPLAD Scheme works in 208 districts in four phases spread over 2007-08 to 2010-11. In the year 2012-13, the Agricultural Finance Corporation (AFC) Limited reviewed works in 100 selected districts. In the year 2021, the ministry engaged Deloitte India to evaluate works in selected 216 nodal districts from 2014 to 2019.

 

The NABCONS and AFC found that the MPLAD Scheme was an example of decentralised development and has resulted in creation of good quality assets, which have had a positive impact on the local economy, social fabric, and the physical environment. In its report, NABCONS described MPLAD as the only countrywide scheme, which involves local communities, groups and sections of people for identification of works/facilities required as per the “felt needs” and wish list of the local people.

 

However, the third-party physical monitoring of MPLAD Scheme work has revealed a few shortcomings, including sanction of ineligible works, encroachment of assets, non-existence of some assets, diversion of use of assets, delay in financial sanction and completion of works, and works awarded to ineligible trust/societies. The Deloitte report stated that out of the total assets assessed and verified, 95.9 per cent were found to be functional and 95.6 per cent of the total sampled projects created under MPLAD Scheme were found to be immovable/durable. In cases of irregularities brought out in these reports, the ministry had requested state governments and district authorities concerned to initiate suitable action against erring officials. Also, the guidelines have been suitably modified, like fixing the limit of unspent balance for release of funds so as to ensure optimal utilisation of these funds, the parliamentary panel report said.

 

But ADR’s Chhokar remains sceptical. He says that money under these schemes is used to appease or oblige two sets of people: opinion-makers or opinion-influencers, and favourite contractors. He also dismisses the argument that an elected representative, such as an MP, only recommends to the district officials where to spend money, which is then disbursed by the latter. “Can you imagine a district magistrate not following a written recommendation of an MP on where and how to use the funds,” he asked.

 

In its fourth report titled Ethics in Governance, released in 2007, the Second Administrative Reforms Commission recommended that “schemes such as MPLAD and MLALAD should be abolished”. It noted that these schemes “seriously erode the notion of separation of powers as the legislator directly becomes the executive”, “infringes on the rights of the local governments".

 

When the constitutional validity of MPLAD Scheme was challenged in the Supreme Court in 1999, followed by petitions in 2000, 2003, 2004, and 2005, the apex court in its combined judgment for all these petitions on May 6, 2010, held the scheme to be constitutional.

 

But Saleng believes the ambit of schemes, such as MPLAD, needs to be expanded. “The scheme allows an MP, and other elected representatives, to reach out to their constituents and initiate development works that they want. I would wish to direct funds allocated to me for affordable education, healthcare and investing in renewable energy,” he said.