'Diversion' of SC/ST funds leaves Karnataka legislators fuming

In 2013, Karnataka become the second Indian state after Andhra Pradesh to enact a law that mandates spending public money to uplift Scheduled Castes and Scheduled Tribes.

Under the pioneering law - the Karnataka Scheduled Castes Sub Plan and Tribal Sub Plan (Planning, Allocation and Utilisation of Financial Resources) Act - the state has to spend 24.1% of its total budget on SC/ST welfare: 17.15% for SCs and 6.95% for STs.

Years later, questions are being raised on the way the law is being implemented, with legislators crying foul. This discontentment among SC/ST legislators could potentially cast a shadow on the B S Yediyurappa-led BJP government.

In December 2020, a furore ensued in the Legislative Assembly with MLAs from both the BJP and the Congress lashing out at the government for diversion of SC/ST funds.

Three months later, even as the government announced a fresh allocation of close to Rs 27,000 crore under the sub-plans for the 2021-22 fiscal, legislators remain wary.

The legislation provides for penalisation if the money is used for other purposes and also says that the funds are non-lapsable. This means the money, once allocated, cannot be returned to the treasury. But to show utilization, departments haphazardly make use of the money for projects without assessing whether or not it will contribute to SC/ST welfare, MLAs argue.

The bone of contention is Section 7(D) of the Act that deals with ‘deemed expenditure’: when it comes to infrastructure works, a portion of the project cost shall be ‘deemed’ to have been provided for the SC/ST sub-plans. Officials maintain that without 7(D), they would be hard-pressed to find other means of funding infrastructure projects, but MLAs are angry.

“For instance, they take up works for construction of a canal under the sub-plan grants allocated to the irrigation department. Even though this is not specific to SC/ST welfare, their argument is that even SC/STs use this water. So, it is presumed or deemed to be expended for their welfare,” BJP’s Kudachi MLA P Rajeev explained.

Kollegal MLA N Mahesh, the lone BSP representative in the state, illustrates a specific example of the ‘misuse’. “One case was that of the Narayanapura right canal. The official justification for using the SC/ST sub-plan grants for this was that there were three reserved constituencies in the surrounding region with a significant SC/ST population. However, this is not the right way to go about it,” he contended. “They should look at the extent of land belonging to the SC/ST communities that can be irrigated through this project.”

Rajeev and Mahesh are among many SC/ST legislators who believe that the “deemed expenditure” provision must be repealed. If it is removed, the government will have at least Rs 5,000 - Rs 6,000 crore every year specifically for SC/ST welfare, Mahesh pointed out.

According to official data, save for the pandemic-hit 2020 where only 54% of the allocated funds were used, the government has been consistently utilising over 90% of the sub-plans money. However, over 60% is used under deemed expenditure, experts said.

To ensure that the money is used specifically for the welfare of SC, ST communities, the government must establish a single-window system with a sector-wise allocation of money, instead of department-wise distribution, R V Chandrashekar from the National Law School’s Centre for the Study of Marginalized Communities said.

“Health, education and skilling must be a priority,” he said. “There are 74 Notified Tribes and Denotified Tribes (NTDNT) under SC/ST category. Many of them are homeless. The government should use this money to provide them shelter,” he added, pointing out that the government had not created any parameters to measure the progress of communities under the law. “From 2013 till now, there is no evaluation on its implementation.”