The Centre is proposing to provide ₹12,000 crore for additional expenditure on government schemes including the Mahatma Gandhi National Rural Employment Guarantee (Mgnrega) scheme.

The rural employment guarantee scheme will require additional funds beyond the upwardly revised Rs 98,000 crore in the Budget presented on February 1.

According to the finance ministry estimates, the scheme may require another Rs 8,000-9,000 crore. The ministry also expects increase in the outflows towards fertilizer subsidy and by the Department of Food and Public Distribution.

However, officials said these extra expenditures were well within the comfort level and will be capped at Rs 12,000 crore.

“Some schemes may require more than RE (revised estimate). But they will be below Rs 12,000 crore and, if required, we may use the contingency fund,” a senior official from the finance ministry told ET.

Article 267 of the Constitution mandates formation of a corpus under the Contingency Fund of India to deal with any emergency situation.

In the last Union Budget, the government enhanced the Contingency Fund from Rs 500 crore to Rs 30,000 crore through the Finance Bill 2021, keeping in view the pandemic.

Another official said that every increased allocation would be scrutinised for its usage.

ET had earlier reported that 19 states have overshot the expenditure on the rural employment guarantee scheme for the current year and the overall expenditure on the scheme had shot up to 102.39% till February 21. Other states have also asked the Centre to provide more funds, citing increased demand.

The Centre had in the revised estimates enhanced the allocation for Mgnrega from Rs 73,000 crore to Rs 98,000 crore for 2021-22. For 2020-21, the expenditure was to the tune of Rs 1.11 lakh crore. Finance minister Nirmala Sitharaman has maintained that allocation for the scheme will be increased “if demand arises” .