Jairam wants FinMin to modify norms for calculating unspent balances

The tardy implementation of several schemes has led to this step

 The tardy implementation of several schemes leading to under-utilisation of allocations has forced the Ministry of Rural Development headed by Jairam Ramesh to seek modifications in assesment of unspent fund.

Ramesh is likely to seek a review of the norms adopted by the Ministry of Finance for assessing unspent balances. The MoRD will press for modifications in the existing norms to ensure that a minimum time for utilisation of the fund was given to the implementing agencies before the unspent portion of it was calculated.

Ramesh’s move came after substantial amount of fund earmarked for the projects of the MoRD and Ministry of Drinking Water and Sanitation remained unutilised in 2010-11 and 2011-12.In 2010-11, against the budget allocation of Rs 76378.15 crore for the Department of Rural Development, the actual expenditure was Rs 72109.38 crore, indicating under spending of Rs 4268.77 crore.

Similarly, the actual expenditure during the financial year 2011-12 was Rs 48068.13 crore till January 31, 2012 against allocation of Rs. 67183.32 crore in the revised budget estimate, indicating a shortfall of Rs 19115.19 crore.

Even in 2012-13, slow pace of implementation might leave about Rs 8300 crore of the total allocations made for the self-employment and village connectivity schemes unutilised.

During the recent review meeting of schemes under the MoRD and MDWS, Ramesh, who also holds the drinking water and sanitation portfolio, pointed out that balances available with the state governments from the allocations for the schemes should be treated as total available fund and only the portion that would remain unutilised after the minimum time required for utilisation should be considered as unspent balance.

MoRD and MDWS officials pointed out that existing norms laid down by the Ministry of Finance required that even the funds released towards the end of the financial year be considered as unspent balance if the state governments failed to utilise them before the end of the year.

A review of the rural development schemes revealed that about Rs 7700 crore of the total allocation for the Pradhan Mantri Gram Sadak Yojana in the budget estimate for the current financial year might have to be surrendered due to tardy implementation of the programme.