Govt Allocates 22% Less Funds for MGNREGA, Parliamentary Panel Calls for Wage Review

New Delhi: In a recent parliamentary committee report tabled in the Lok Sabha, it has been revealed that the Finance Ministry has allocated significantly less funds for the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) than requested by the Rural Development Ministry for the current financial year (2023-24).

According to The Indian Express, the report titled "Rural Employment Through Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) – An Insight into Wage Rates and Other Matters Relating Thereto" discloses that the Department of Rural Development (DoRD) had initially sought Rs 1.1 lakh crore for MGNREGA at the Revised Estimate (RE) stage. This amount was 83% higher than its Budget Estimate (BE) of Rs 60,000 crore for the financial year. However, the Finance Ministry revised the allocation upward to only Rs 86,000 crore, falling short of the amount sought by the Rural Development Ministry.

Quoting a written submission of the DoRD, the report highlighted, "With the current pace of persondays generation against demand for wage employment, an amount of Rs. 50,000 crore has been anticipated as additional fund in RE 2023-24 over and above BE of Rs. 60,000 crore."

In the Interim Budget 2024-25 presented by Finance Minister Nirmala Sitharaman on February 1, the MGNREGA allocation has been revised upward to Rs 86,000 crore for the current financial year (2023-24).

The committee, chaired by Dravida Munnetra Kazhagam (DMK) member Kanimozhi Karunanidhi, expressed concern over the demand for raising the guaranteed number of days of work under MGNREGA from 100 to possibly 150. "The Committee finds that the number of permissible works under MGNREGA has increased to 266. Also, the RE sought by DoRD for the ongoing Financial Year 2023-24 is Rs.1,10,000 crore. These aspects only strengthen the opinion that demand for work under MGNREGA has not diminished," the report stated.

MGNREGA ensures that every rural household whose adult member opts to engage in unskilled manual work is guaranteed a minimum of 100 days of wage employment per financial year. However, despite Section 3(1) of the MGNREGA stipulating this minimum requirement, it has effectively become an upper limit due to limitations in the NREGAsoft system, which restricts data entries for employment beyond 100 days unless specifically requested by the State/UT.

There are exceptions to this rule. In certain cases, the government permits an additional 50 days of wage employment beyond the mandated 100 days. For example, Scheduled Tribe households residing in forest areas are entitled to 150 days of work under MGNREGA, provided they possess no other private property except for land rights granted under the Forest Right Act, 2016.

Moreover, under Section 3(4) of the MGNREGA, the government has the authority to provide an extra 50 days of unskilled manual work in a financial year, on top of the initial 100 days, in rural areas affected by drought or other natural calamities, as per notifications from the Ministry of Home Affairs.

Consequently, the committee recommended the DoRD conduct a practical study to review the need and justifications for increasing the number of guaranteed days of work under MGNREGA from the current 100 days to 150 days.

The report also addressed concerns regarding the inadequacy of daily wages paid under the MGNREGA scheme. "The committee finds the range of wages vary...," it stated, highlighting the disparities across different regions.

It noted significant disparities across different regions, with wages ranging from as low as Rs 221 in Madhya Pradesh and Chhattisgarh, Rs 224 in Arunachal Pradesh, Rs 228 in Bihar and Jharkhand, to Rs 354 in Sikkim's three-gram panchayats (Gnathang, Lachung, and Lachen), Rs 328 in Nicobar, and Rs 311 in Andaman.