Rekha Gupta government in Delhi reduced the LAD fund of MLAs from 15 crores to 5 crores, the AAP government had increased it last year.
Delhi Govt Slashes MLA Local Area Development Fund from ₹15 Crore to ₹5 Crore Under Rekha Gupta’s Leadership
In a major policy shift, the Rekha Gupta-led Delhi government has significantly reduced the Local Area Development (LAD) fund allocated to MLAs from ₹15 crore to ₹5 crore annually. This move marks a dramatic departure from the previous Aam Aadmi Party administration, which had steadily increased the fund over recent years.
The decision, officially announced by the Urban Development Department, was approved in a cabinet meeting held on May 2, 2025. As per Cabinet Decision No. 3187, the new allocation of ₹5 crore per MLA will be implemented from the current financial year (2025–26).
According to the government order, the revised fund remains untied—meaning MLAs can utilize it not just for capital projects but also for repair and maintenance work without restriction. Despite the significant cut, the total MLA fund pool stands at ₹350 crore for the 70 members of the Delhi Assembly.
A BJP MLA, speaking to PTI, defended the move, suggesting that the new allocation maintains a balance between fiscal prudence and developmental needs. However, the opposition is likely to view this as a step back from the robust developmental funding model seen during the AAP regime.
Under the Aam Aadmi Party government, the LAD fund had steadily risen: from ₹4 crore in 2021–22 to ₹7 crore in 2023–24, eventually peaking at ₹15 crore just before the 2025 Delhi Assembly elections.
This bold decision by the Rekha Gupta government may spark political debate, but it also signals a new approach toward financial management and resource allocation in Delhi’s governance landscape. Whether this change accelerates grassroots development or hampers local progress remains to be seen.
