A significant administrative lapse has thrown a spanner in the works for Karnataka's flagship Gruha Lakshmi scheme, leaving payments for two months in limbo and affecting over 1.2 crore women beneficiaries across the state. The failure to release the February and March instalments, amounting to a staggering Rs 5,500 crore, has sparked a political storm and raised urgent questions about governance and fiscal management.
What Went Wrong with the Payouts?
The crisis stems from a procedural oversight during a system migration. In February 2024, the state government decided to shift the payment mechanism for the Gruha Lakshmi scheme. Instead of routing funds through the Women and Child Development Department, it moved to transfer money directly to beneficiaries via taluk panchayats using the Direct Benefit Transfer (DBT) system.
However, during this transition, the instalments for February and March 2024-25 were not processed. A critical error occurred when the finance department failed to carry forward these committed expenditures into the new financial year that began in April 2025. This led to the funds lapsing, a fact that remained under the radar until it was highlighted in the legislature.
Political Pressure and Government's Scramble
The issue came to light when BJP MLA Mahesh Tenginakai raised it during the question hour of the recent Belagavi winter session. This put Women and Child Development Minister Laxmi Hebbalkar in the hot seat, facing sharp criticism from the opposition.
Minister Hebbalkar stated that her department had flagged the issue as early as April and had written multiple letters to the finance department. "We are committed to the welfare of the beneficiaries. The two pending instalments will be paid as soon as the finance department releases the fund," she assured. The finance department, under Chief Minister Siddaramaiah, who also holds the portfolio, is now exploring all possible avenues to resolve the impasse.
Economic adviser to the CM, Basavaraj Rayareddi, sought to calm nerves, stating, "We're exploring all possible means to resolve the issue. The beneficiaries need not be worried, as they will definitely get the money."
The Fiscal Roadblock and Possible Solutions
The core of the problem is fiscal. The pending instalments belong to the previous financial year. As the current year enters its final quarter, the government's revenue account is nearly exhausted, preventing a fresh provision of funds. Although two supplementary budgets were presented in the winter session, these specific payments could not be included.
Former finance secretary S Subramanya outlined the limited options available. "One, the government can propose another supplementary budget before the year ends, but it must find the money first. The other is to make a fresh provision in the next year's budget," he explained. This technical hurdle means beneficiaries might have to wait until the next fiscal cycle, a prospect the opposition is fiercely contesting.
Launched in August 2023, the Gruha Lakshmi scheme is a cornerstone of the state government's welfare agenda, providing Rs 2,000 per month to women heads of poor households. While 23 instalments have been successfully disbursed so far, this delay has cast a shadow over the scheme's implementation. The opposition, led by Tenginakai, is demanding immediate payment and transparency, questioning where the allocated Rs 5,500 crore has gone if the government claims there are no funds.
