Welfare schemes may cost Rs 15,000 cr more

The Centre may end up spending at least Rs 15,000 crore extra during 2006-07 on social sector schemes announced by the UPA government since it assumed office last year.

Senior government officials told Business Standard that the rural development ministry had asked for an additional Rs 6,000 crore for the National Rural Employment Guarantee Programme (NREGP), which was to be implemented in the 200 most backward districts of the country next year.

The government has allocated Rs 10,000 crore for rural employment this year, which included Rs 6,000 crore for the National Food for Work Programme (the precursor to NREGP) and Rs 4,000 crore for the Sampoorna Grameen Rozgar Yojana.

Similarly, allocation for the Sarva Shiksha Abhiyan, an elementary education scheme, is also expected to climb up from Rs 7,156 crore this year to around Rs 11,000 crore during 2006-07, according to estimates prepared by the ministry of human resources development.

The cost of the scheme would be the highest next year and start decreasing from 2007-08, officials said. In addition, Rs 3,100 crore has been provided for the Mid-day meal scheme this fiscal.

The government would have to provide an additional sum of at least Rs 3,500 crore for the National Urban Renewal Mission for the next fiscal, officials said. The Centre had allocated Rs 5,500 crore during the current fiscal, which included a grant component of Rs 1,650 crore.

The urban development ministry has sought that the allocation be enhanced to Rs 16,000 crore in the second year, officials said. The ministry had proposed that the Centre provided Rs 55,000 crore for the scheme over seven years.

However, the finance ministry has proposed that the Centre's contribution be brought down to Rs 25,000-30,000 crore. The matter was referred to the Union Cabinet last week and an announcement in this connection is expected shortly.

An additional allocation for the projects to be undertaken by the National Highways Authority of India has also been proposed. However, a large part of the additional expenditure would be met through the cess on petrol and diesel, which got transferred to the Central Road Fund, officials said. The government provided a budgetary support of Rs 9,500 crore for roads and highways during the current fiscal.

The government's expenditure will increase further once the health ministry presents its requirements for the National Rural Health Mission. Allocation for the ministry of health and family welfare had been increased by Rs 1,800 crore to finance various components of the health mission.

The Planning Commission has received preliminary estimates for spending under these schemes during the next financial year. The plan panel has recommended that the Gross Budgetary Support for the Central schemes be enhanced by 35 per cent to around Rs 1,50,000 crore from Rs 1,10,385 crore this year. On the other hand, the finance ministry is in favour of a 10-12 per cent increase, officials said.

The finance ministry will firm up its estimates towards the end of the month after it concludes its consultations with all departments and ministries on revised estimates for this year and the budget estimates for next year.