The Member of Parliament Local Area Development Scheme (MPLAD)

Member of Parliament Local Area Development Scheme

The Member of Parliament Local Area Development Scheme (MPLAD) is one of the prominent Central Plans which was launched on December 23, 1993. The Central Plans are basically those nation-wide plans which are formulated and financed by the Central Government. These plans have been continuously implemented by the Centre and are detrimental to the socio-economic development of the Country. The Central Plans are basically funded by the budgetary resources and extra-budgetary resources of the Public Enterprises.

Click Here to read about India’s disinvestment policy for Public Enterprises.

There are a total of three Central Plans, they are-

  • The Five Year Plans
  • Twenty-Point Programme
  • Member of Parliament Local Area Development Scheme

And in this article, we’d be discussing the last central plan, the MPLAD.

Member of Parliament Local Area Development Scheme
Image by- FACTLY

Member of Parliament Local Area Development Scheme (MPLAD)

Overview of the Scheme

The Scheme was launched on 23rd December 1993. Under this scheme, each Member of Parliament would be allotted rupees 5 lakh for the specific development of their local area, i.e. their constituency. However, as the amount was too small to facilitate the required development objectives, the amount given to each MP was increased from 5 lakhs to 1 crore in the year 1994-95.

Even after this increase, the MPs were not satisfied and put forward a demand to increase the amount to 5 crores in 1997-98. Considering their demand, the amount was increased to 2 crores in 1998-99. And finally, the amount allotted for each MP has increased to rupees 5 crores in April 2011 and the amount is unchanged since then.

Member of Parliament Local Area Development Scheme
Image by- Times of India

The responsibility of policy formation, releasing of funds and prescribing monitoring mechanisms for implementation of the scheme was initially vested in the hands of the Ministry of Rural Development. However, it was vested in the hands of the Ministry of Statistics and Programme Implementation in 1994


The main objective of such a scheme was that the fruits of development could directly reach the general population through their representatives, i.e their MPs. And the MPLAD scheme was one such scheme that could fulfil such an objective. As the scheme directly allocated money for the particular constituency to its MP, who is in the best place to understand the local development needs. Hence, the scheme also supported the policy of decentralization.

Working of the Scheme

Under the Member of Parliament Local Area Development Scheme, the Member of Parliament recommends certain works related to the development of the concerned constituency (for example, the development of fixed community assets such as schools, hospitals, roads, etc) to the concerned District Magistrate. The works, recommended by the MP, are sanctioned by the concerned District Authorities (DAs), and it is responsible for the overall coordination and supervision of works under the MPLAD scheme. So, the MPs can only ‘recommend’ the works, while the final powers to sanction it vests in the hands of the concerned District Authorities (DA).

Member of Parliament Local Area Development Scheme
Image by- Drishti IAS

Moreover, the MPs are required to recommend works worth at least 15% of their funds to create assets in the areas inhabited by the Scheduled Caste (SC) population, and 7.5% of their funds to create assets in areas inhabited by the Scheduled Tribe (ST) population.

In every state, a state-level nodal department is responsible for the supervision, maintenance and monitoring coordination with line departments.

The working of this scheme is governed by a set of guidelines that have been issued and revised by the Government over the years. The initial guidelines were comprehensively revised by the Ministry of Statistics and Programme Implementation in November 2005.

Moreover, the latest guidelines have been issued by the concerned ministry in 2014. These guidelines are:

  • Under the new guidelines, the earlier set ceiling of 50lakh, for the building of assets by trusts and societies in areas occupied by tribals, has increased to 75 lakhs. The main motive is to incentizise the various trusts and societies working for the betterment of tribal people.
  • For the promotion of cooperative movement and rural development, cooperative societies have been made eligible under the scheme.
  • Under the new guidelines, the MPs are allowed to allocate the funds outside their constituency, state or Union Territory.
  • The MPs can now recommend works for up to 25 lakhs in case of natural calamity in the state and works up to 1 crore in the case of severe natural calamities, such as Tsunami, major cyclones and earthquakes.
  • The funds allocated under the Member of Parliament Local Area Development scheme could now be converged with other approved Central schemes such as the Mahatama Gandhi National Rural Employment Guarantee Scheme (MGNREGA), the National Program for Development of Sports (Khelo India) and with other State Government schemes too.
  • Under the new guidelines, the funds from local bodies can now be pooled with MPLADS works. And public and community contribution is made permissible.
  • The new guidelines have provided for a proper mechanism for the implementation and auditing of the works under the MPLAD scheme.
  • The MPLAD scheme now also includes the projects such as the purchase of ambulances and hearse vans for the concerned District Authority and the purchase of books for libraries in the area.

The One MP-One Idea

Member of Parliament Local Area Development Scheme
Image by- Facebook

The latest guidelines issued by the Ministry of Statistics and Programme Implementation for the Member of Parliament Local Area Development Scheme has provided for the ‘One MP – One Idea’ initiative. The initiative is based on annual competition, at the constituency level, for the best innovation in solving local problems. Under the initiative, the three best innovation ideas by the local people are recognized and are awarded cash prizes. Individuals, NGOs, groups, academia and industry can take part in the competition.

Types of works recommended by the MPs

Under the latest guidelines issued in 2014, the Ministry of Statistics and Programme Implementation has provided the list of both the prohibited items and permissible items under the Member of Parliament Local Area Development Scheme. The list also included the priority sectors under the scheme:

List of prohibited items

  • Acquisition of land and paying compensation
  • Construction of office and residential buildings for public and private agencies
  • Providing grants or loans to the state or central relief fund
  • works on land belonging to religious groups
  • execution of works in unauthorized colonies
  • naming assets after individuals
  • acquiring assets for individual benefit

List of other permissible items 

These are just ‘some’ of the permissible items under the MPLAD scheme.

  • Instalment of CCTV cameras in strategic locations
  • Instalment of bio-digesters at stations
  • Instalment of rainwater harvesting systems in public spaces
  • construction of railway halt station
  • fixed weighing machines for farmers
  • construction of shelters for skill development

The Priority sectors

  • Education
  • healthcare and sanitation
  • roads
  • railways
  • pathways and bridges
  • drinking water
  • agriculture and allied activities
  • irrigation
  • sports
  • development of self-help groups
  • urban area development
  • non-conventional energy resources
Criticisms of the MPLAD scheme
Image by- The Economic Times

Even though it’s prominent and exceptional developmental nature, with an emphasis to further the decentralization process and the principle of participatory development, the Member of Parliament Local Area Development Scheme has been subject to some serious criticisms.

Misappropriation of funds

The major criticism of the scheme, especially from the backward states, is the ‘misappropriation of funds’ and even the non-use of funds allocated for a particular constituency to the MP. Due to this drawback, many organizations have even demanded to scrap the MPLAD scheme, as they consider that the scheme infringes upon the idea of decentralized planning. They instead advocate that the funds should be transferred directly to the local bodies for the same kind of works specified under the MPLAD scheme.

Lack of monitoring indicators

Moreover, the scheme has been constantly criticized due to the lack of an indicator to measure the level local of participation. As the scheme is mainly based on the principle of ‘participatory development’, with the principal objective being the fulfilment of ‘locally felt needs’, lack of an indicator or even a measure that would disclose the actual measure of local participation, seems absurd.

There is also a lack of proper monitoring indicators, and moreover, the activities related to the monitoring of the implementation of the works under MPLAD Scheme is also not mentioned in the annual reports of the scheme. As per the scheme, the implementation agencies are required to submit a utilization certificate to the concerned District Authorities, however, it is often that these certificates are not submitted to the authorities. Moreover, there is no indicator to measure the condition of the asset after being built under the MPLAD scheme.

The politicization of the scheme 

Image by- Vajiram IAS

It is found that the majority of the unspent funds and the new funds are utilized by the MPs at the last year of their 5 year term, mainly to lure the people and gather votes. So, in order to save their seats, the MPs increase the expenditure and utilization of funds and sanction of new projects under the MPLAD scheme in the last year of their term. Hence, it is often found that the MPs have a passive approach towards the scheme in the initial years of their term, and their outlook turns active when the elections are close, leading to the politicization of the scheme.

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