New Delhi A 17% cut in the budgetary allocation for the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) for FY13 is a fallout of successive years of poor expenditure by states and allegations of diversion and misappropriation of funds.

“Considering that states have not been able to spend the budgeted amount in FY12 and even in the previous years, it’s only prudent to reduce allocation in MGNREGS and channel the funds towards some other schemes where the government needs to invest more,” said a senior government official.