New Delhi: In a significant shift from the previous regime, the BJP-led Delhi government has reduced the MLA Local Area Development (LAD) Fund from ₹15 crore to ₹5 crore per annum, starting the financial year 2025-26, according to an official order issued by the Urban Development Department.
The decision, formalized through Cabinet Decision No. 3187 on May 2, 2025, marks a sharp rollback of a hike introduced by the Aam Aadmi Party (AAP) government just months before it was voted out in the February 2025 Assembly polls. At the time, the AAP had increased the MLA LAD allocation from ₹10 crore to ₹15 crore per constituency, terming it essential for hyperlocal development.
According to the latest order, “the allocation of fund under MLALAD Scheme has been kept at ₹5 crore per assembly constituency per year from financial year 2025-26 onwards.” The order also noted that the fund will now be treated as “untied”, meaning MLAs can use it for a wider range of development activities, including both capital works and repair/maintenance projects, with no specific ceiling on categories.
A BJP MLA, speaking on condition of anonymity, said the total allocation under the scheme now stands at ₹350 crore for Delhi’s 70 MLAs. “The cabinet wants to ensure transparency and accountability. The untied nature of the fund will give legislators flexibility, but also demands greater responsibility,” the MLA said.
Under the AAP government, the MLA LAD Fund had seen steady increases: ₹4 crore per MLA in 2021-22 and 2022-23, rising to ₹7 crore in 2023-24, and peaking at ₹15 crore in the 2024-25 budget — a move many political analysts viewed as a pre-election populist measure.
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