The Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) has been allocated Rs38,500 crore, once described by Prime Minister Narendra Modi as 'living proof of the Congress party's failure'.
The scheme introduced by the Congress-led government in 2005, promises unskilled manual work to every adult for at least 100 days in rural parts of the country.
"It is the highest amount spent on the scheme," said Finance Minister Arun Jaitley.
Last year too, the government had increased the allocation for the previous UPA government's flagship scheme by 12 per cent to a record Rs.34,699 crore.
A day before that, Modi had said in Parliament: "I will ensure MNREGA is never discontinued. It is proof of the Congress' failure. After so many years of being in power, all you were able to deliver is for a poor man to dig ditches a few days a month."
The prime minister had also said the scheme would remind people who the party that had governed the longest had failed them. "You will give me credit for this at least that I have some rajnaitik sudhbudh (political acumen). This is why MNREGA will stay," he said.
According to experts, increasing allocation for the scheme has become politically expedient for the Modi government ahead of state polls and after the ruling BJP's massive defeat in the Bihar election.