In a significant budgetary move reflecting Maharashtra’s ongoing fiscal challenges, funds earmarked for Scheduled Castes (SC) and Scheduled Tribes (ST) welfare have been reallocated to the Majhi Ladki Bahin Yojana, the state’s flagship direct-benefit scheme for women. The decision has been formalised through a Government Resolution (GR) issued on Friday, and is understood to contravene Union finance commission guidelines, according to state officials.
A total of ₹746 crore has been sanctioned for diversion from the original allocations of the Social Justice and Tribal Development departments. As per the resolution, ₹410.30 crore from the ₹3,960 crore allocated to the Social Justice Department and ₹335.70 crore from the ₹3,240 crore assigned to the Tribal Development Department will now be directed toward financing beneficiaries of the Ladki Bahin scheme who belong to SC and ST communities.
The Majhi Ladki Bahin Yojana, which provides a monthly allowance of ₹1,500 to economically disadvantaged women, currently supports over 24.6 million registered beneficiaries. The state incurs an expenditure of approximately ₹3,800 crore each month to sustain the scheme. Originally introduced as a welfare measure, the programme was widely credited for contributing to the Bharatiya Janata Party-led Mahayuti alliance's landslide victory in the 2024 state assembly elections.
However, the reallocation of welfare funds has triggered concerns within the administration. Officials from the Social Justice Department have expressed reservations, pointing out that planning commission norms stipulate that funds meant for SC and ST populations should remain protected, non-transferable, and fully utilised within the financial year. It has also been noted that states such as Odisha, Karnataka, and Andhra Pradesh have already enacted laws ensuring the ring-fencing of such welfare budgets.
Despite this, the Maharashtra Finance Department has maintained that the reallocation is procedurally valid, given that the diverted amount will be used for beneficiaries from the same target socio-economic groups under a different welfare scheme. References have been made to precedents where SC/ST funds have been deployed for cross-departmental schemes such as the Sanjay Gandhi Niradhar Yojana and the Shravan Bal Nivrutti Vetan Yojana.
The state’s overall fiscal situation has been under strain, with the estimated revenue deficit for the financial year 2025–26 projected at ₹45,892 crore. This has placed considerable pressure on the government to fund the numerous populist schemes launched prior to the elections. In the absence of additional revenue streams or external borrowing, internal reallocation of budgeted funds appears to have been adopted as a stopgap measure. The decision is expected to attract scrutiny, with legal and political implications likely if challenged in court or public forums. As debates continue internally over the legality and ethical implications of the move, the state administration is reportedly considering legislative safeguards to prevent such reallocations in the future, though consensus on the matter remains elusive.