Jairam’s fund offer upsets his babus

The rural development minister Jairam Ramesh recently offered to spare one per cent of the budgetary allocation of his ministry for the panchayati raj ministry. He said that this would help develop panchayati raj institutions in the country. However, the officials of his ministry have opposed the move, pointing out that funds allocation for a ministry can only be done by Parliament.

Ramesh has proposed that from the rural development ministry’s annual budget of Rs 99,000 crore, an amount of Rs 990 crore be given to the panchayati raj ministry.

It is learnt that the secretary of the rural development ministry S Vijay Kumar has informed Ramesh that the rural development ministry does not have the power to transfer funds to another ministry.

Independent observers feel that Ramesh's stand has no legal standing. 'The budget allocation for a ministry is only done by Parliament. It is not the prerogative of an individual minister to allocate budget to another ministry,' said Subhash Kashyap, a constitutional expert and former general secretary of the Lok Sabha.

A former secretary of the Planning Commission Sudha Pillai explains how funds transfers are done within ministries. 'After getting a go ahead from the Union cabinet, such a proposal is tabled in Parliament and then the standing committee reviews it,' said Pillai. She added that in this case the rural development ministry should mention from which of its departments it will cut the funds.

Defending his action, Ramesh told Millennium Post that he did not require any approval from the Union cabinet to transfer funds and a decision to this regard had already been taken. However, he added that the finance ministry will adjust the transferred amount in the revised estimates and seek the necessary parliamentary approval. He said, 'The reduction in the budget of the rural development ministry will come in the revised estimate in October or November, and the parliamentary approval will be taken by the finance ministry,' said Ramesh.

He, however, did not specify from which department he proposes to cut the funds by Rs 990 crore.