Parliamentary panel questions suspension of funds to Bengal under MGNREGS and other schemes

New Delhi: Suspension of funds to West Bengal under MGNREGS and other schemes has led to "severe consequences", including a sharp increase in distress migration and disruptions in rural development initiatives, the Parliamentary Standing Committee on Rural Development said in a report, as it raised concern over the ministry's funds remaining underutilised.

In a report on demand for grants from the Union Ministry of Rural Development tabled in Parliament on Wednesday, the panel headed by Congress MP Saptagiri Sankar Ulaka said the committee found in the data on physical and financial progress provided by the ministry that no Central funds have been released to West Bengal under MGNREGA and various other schemes for the financial years 2022-23, 2023-24, and the current fiscal.

"The continued suspension of funds has resulted in severe consequences, including a sharp increase in distress migration and disruptions in rural development initiatives," the panel said.

"This has had a significant adverse impact on the livelihoods of rural populations, exacerbating economic hardships in the state," it added.

West Bengal should receive its rightful dues for all eligible years, except for the year currently under dispute in court, the committee recommended.

It said the pending payments must be released without delay to ensure that the ongoing rural development projects are not stalled, and that the intended beneficiaries do not suffer due to financial constraints.

The panel also said that there is stagnation of funds in the flagship Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS).

The committee is concerned to note that the budget estimates under MGNREGS for FY 2025-26 have remained unchanged at Rs 86,000 crore since the revised estimates for 2023-24.

"The committee is unable to comprehend the rationale for not increasing the allocation of funds under MGNREGA since 2023-24," it said, urging the rural development ministry to look afresh into the requirements for fund allocation.

As MGNREGS is a demand-driven scheme, the funds can be raised at the revised estimate stage accordingly, the panel said.

"The committee, therefore, recommends that the department of rural development apprises itself of the still existing high demand for jobs under MGNREGA at the ground level more realistically, and press upon the finance ministry for increased allocation to MGNREGA," it said.

The panel also raised concern over the rural development ministry not fully utilising its funds.

Against funds worth Rs 1,73,804.01 crore allocated at the revised estimate stage of 2024-25, the actual expenditure was Rs 1,13,284.55 crore only, which was 34.82 per cent less than the allocated funds, the panel said.

"This indicates that either the budgetary planning of the government was not prudent enough, or there was a problem at the actual implementation stage of the schemes," it said.

As per the latest financial review, the accumulated unspent funds under the Pradhan Mantri Awas Yojana-Gramin is Rs 15,825.35 crore, Pradhan Mantri Gram Sadak Yojana Rs 3,545.77 crore, National Social Assistance Scheme Rs 1,813.34 crore, National Rural Livelihood Mission Rs 2,583.16 crore, and for MGNREGS, it is Rs 1,627.65 crore, the panel said.

"The committee strongly recommends that the department of rural development develops innovative strategies and adopts a more effective approach to enhance fiscal prudence," it added.