Ahead of the 2014 general elections, the UPA government has eased norms for MPs for faster utilisation of their local area development fund (MPLAD) of Rs. 5 crore per annum. The changes, however, raises concern over possible misuse of funds.
Among the slew of changes, the ministry of statistics and programme implementation has removed tendering as a mandatory clause for selecting the project implementing agency. Instead, the ministry had allowed the district administration to select the agency on the basis of state government rules.
The new flexibility allows the district authorities to spend the money provided by MPLADs through NGOs. The criteria for selection of the NGO have also been left vague. “The NGO should preferably be of national repute and should be selected by a committee under district authority,” the new rules say.But, many MPs have raised objections saying NGOs will have no accountability and chances of misuse of funds would be much higher. "The ministry should prescribe the parameters for identifying the NGOs rather than leaving it to the district administration," said an MP.
Another grey area in the rules is making panchayati raj bodies, which do not have adequate infrastructure, the nodal agency for execution of works in rural areas.
Government officials say it could result in nepotism as works would be allocated to only those village bodies who find favour with an MP concerned.
For the first time, the ministry has also allowed MPs to allocate money to private aided educational institutions, provided they don’t charge commercial fee. The conditions to allocate funds to them are that they should be recognised by government agencies and are receiving financial assistance from state government.
“I am glad to inform you that on considering the suggestions, modifications have been recently made in certain critical areas to enable more effective implementation of the scheme,” programme implementation minister Srikant Jena said, in a recent letter to all MPs.
The ministry had also enhanced the amount of money a MP can give to a trust or a society in a year from Rs. 50 lakh to Rs. 1 crore.