Local Area Development Scheme (MPLADS) - Definition, Features & Implementation [UPSC Notes]

Current Context related to MPLAD Scheme – Local Area Development Scheme, also called ‘Sansad Nidhi Yojana’ has been suspended for two years (2020-2022) in the wake of the COVID-19 crisis. The funds under MPLADs will be directed to the Consolidated Fund of India. Sum of Rs. 79000 crores are expected to be garnered by suspending the Local Area Development Scheme.

The news related to the suspension of the MPLAD Scheme makes it important for the IAS Exam candidates to know what is MP Local Area Development Scheme and what is its significance. Read on to know about the scheme.

Some important government schemes important for the UPSC exam are mentioned in the table below:

What is MP LAD Scheme?

The Local Area Development Scheme known as MPLADS is a government scheme launched on 23rd December 1993. This central sector scheme was developed as an initiative to enable the parliament members to recommend developmental work in their constituencies based on locally felt needs. These developmental works mainly focused on the areas of national priorities such as drinking water, education, public health, sanitation, roads, etc.

The scheme, Members of Parliament Local Area Development Scheme (MPLADS) was started by late Prime Minister P.V. Narasimha Rao. This scheme is now administered by the Ministry of Statistics and Implementation but was earlier administered by the Ministry of Rural Development.

Arguments in favour of MPLADs Suspension:

In an article published in The Hindu, the following points were mentioned in favour of the suspension of the MPLAD Scheme:

  1. The scheme is contrary to the separation of powers where the legislators become the executors. As the scheme allows the Members of Parliament to recommend projects in a district/state; it takes away the decision-making power of the district authorities as they have no other way but to accept these projects.
  2. Comptroller and Auditor General (CAG) report on the expenditure made under the MPLADS underlines the facts that the amount booked for the scheme is underused. Also, instead of asset-creation which is a prime feature of the scheme, 78 percent of the projects recommended under MPLADS were for improvement of the existing assets.
  3. As per a report published in IndiaSpend:
    • 298 members out of 542 of Lok Sabha did not utilize the amount of Rs.5 crore allotted to them for MPLADS.
    • Between 4th May 2014 and 10th December 2018, 93.55 percent of the MPs couldn’t utilize the entire sum allocated under the scheme.
    • ₹5,000 crores were lying unspent with various district authorities by May 15, 2015
  4. The MPLADS could be misused by the opinion-maker and the opinion-influencer. In this case, the opinion influencer could be MP’s relative or acquaintance which can be the contracting parties. Hence, instead of being a transparent and accountable project for the public, it could be used for a selfish motive.
  5. The constitutional validity of the scheme had been earlier challenged in the years 2000, 2003, 2004, and 2005. Though the Supreme Court upheld the constitutional validity in 2010; many still question the scheme based on its underutilization of the funds and gross irregularities.

Key Features of MPLADS

In addition to the regular State Government departments and the three levels of Panchayats, the rural areas of many districts are also being serviced by Area Development Authorities/Rural Development Boards. These organizations receive sizeable grants from both the Union and the State Governments for schematic expenditure in their jurisdiction with emphasis on crop improvement, creation of minor irrigation facilities, up-gradation of local infrastructure, and other area-specific needs. 

Government schemes are an important part of the UPSC syllabus. Aspirants must be thorough with the objectives and the activities of these major schemes for the IAS exam.

Some of the key features of the Members of Parliament Local Area Development Scheme (MPLADS) are:

  • It is a government-funded scheme where the annual fund provided to each MP constituency is Rs. 5 crores.
  • The initial assistance under the MPLAD scheme was Rs. 5 lakh / MP. From 1998-99 onwards, this amount has been increased to Rs. 2 crore / MP, and the amount currently available under this scheme has been increased to Rs. 5 crore rupees.
  • Recommendation by the MPs should be done annually with works costing at least 15 percent of the MPLADS entitlement for areas inhabited by Scheduled Caste population and 7.5 percent for areas inhabited by the ST population. 
  • A sum of Rs. 75 lakhs is provided for building assets by trusts and societies as per the scheme guidelines to encourage the trusts and societies for the betterment of tribal people.
  • Lok Sabha Members can recommend works within their Constituencies and Elected Members of Rajya Sabha can recommend works within the State of Election. Nominated Members of both the Rajya Sabha and Lok Sabha can recommend works anywhere in the country.

Implementation of MPLADS

  • An MP is required to provide his/her choice of the nodal district to the Ministry of Statistics and Programme Implementation in a prescribed format. A copy of the same should be given to the State Government and the District Magistrate of the chosen district. 
  • The Government of India releases an annual entitlement of Rs. 5 crores in two equal installments. This amount is given to the District Authority of the Nodal District selected by the concerned MP.
  • The Implementing Agency should be identified by the District Authority. The Implementing Agency should have the capability to execute the eligible work qualitatively, timely, and satisfactorily. 
  • All the recommended works must be sanctioned within 75 days from the date of receipt of the recommendation after the completion of all formalities. If any work is not sanctioned within the prescribed time period, the District Authority shall, however, may inform the MPs regarding the rejection of the work within 45 days from the date of receipt of recommendations.
  • This scheme can also be converted into individual/stand-alone projects under the Central and State Government schemes provided they meet the eligibility conditions of MPLADS. 
  • Funds from local bodies can be similarly pooled with MPLADS works but the funds provided by other scheme sources should be used first. MPLADS funds should be released later for the successful completion of the project. As soon as a work under the Scheme is completed, it should be put to public use. 

Guidelines on MPLADS

In June 2016, the government came up with MP Local Area Development Scheme Guidelines. A few important details from these guidelines are mentioned below:

  1. The guidelines mentioned to use the MPLAD funds for the implementation of the following:
    • Swachh Bharat Mission
    • Accessible India Campaign
    • Water Conservation using rainwater harvesting systems
    • Sansad Adarsh Gram Yojana
  2. MPLADS funds could be converged with MNREGS and Khelo India Schemes for the formation of durable assets

Candidates should follow the latest developments in Current Affairs related to other government schemes for their UPSC 2021 preparation. 

Local Area Development Scheme (UPSC Notes):- Download PDF Here

Frequently Asked Questions on Local Area Development Scheme

Q 1. What is the Local Area Development Scheme?

Ans. The Local Area Development Scheme, also known as MPLADS is a government scheme launched with an initiative to enable the parliament members to recommend developmental work in their constituencies based on locally felt needs such as drinking water, education, public health, sanitation, roads, etc.

Q 2. When was the MPLAD scheme implemented?

Ans. Members of Parliament Local Area Development Scheme is a scheme formulated by Government of India on December 23, 1993.

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