Sources said over and above the amount of Rs 1 crore proposed to be given to each Councillor as part of his area fund for development, Leader of the House in the MCD Subhash Arya plans to give Rs 25 lakh each per year to all Councillors representing 41 wards in rural villages.

This comes in the wake of Standing Committee Chairman Vijender Gupta proposing a Rs 40-crore package for these rural villages under the non-plan head.

The development can be related to Commissioner Ashok's Nigam's recent statement that the MCD should distribute its funds more equitably between rural and urban areas, as the latter have been attracting far heavier funds.

The MCD and the Delhi government have been at loggerheads over the drying up of funds for the MCD's Rural Affairs Committee from 2004-05 onwards. Recently, Mayor Arti Mehra had asked the Commissioner to issue notice to any agency except the MCD undertaking any work in rural areas.

She had also said under the Plan Book of the Planning Commission funds for rural roads within the MCD jurisdiction are to be given to the MCD only. The Commissioner had also written to the Delhi government to give special grants-in-aid to the rural sector.