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Centre Declines Additional Funds for MGNREGS
Context:
With the financial year 2024-25 nearing its end, the Central government has decided against releasing additional funds for the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS), asserting that the allocated ₹86,000 crore is sufficient to meet demand.
Concerns Over Fund Diversion
- Misuse: The Centre has raised concerns over the misuse of MGNREGS funds by certain relatively well-off states, alleging that they have turned the scheme into an alternative income source rather than using it as a job guarantee for the needy during off-season periods.
- Examples: For instance, Tamil Nadu, which accounts for just 1.4% of the country’s poor population, has received nearly 11% of the total MGNREGS funds allocated this fiscal year.
- Similarly, Kerala, with only 0.48% of the total poor population, has utilised around 4% of the national allocation.
- In contrast, Bihar and Uttar Pradesh—home to 26.6% and 17.4% of the country’s poor, respectively—have received only 8% and 11.96% of total releases in FY25.
About MGNREGS
The Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) is a landmark legislation in India aimed at enhancing the livelihood security of rural households by providing a legal guarantee of 100 days of wage employment per year to every rural household whose adult members volunteer to do unskilled manual work.
Key Features of MGNREGS:
- Employment Guarantee: Provides a legal guarantee of 100 days of wage employment per year to rural households, helping alleviate poverty and providing a safety net during economic distress.
- Demand-Driven Approach: Employment opportunities are created based on demand from the rural community. Beneficiaries have the right to demand work, and the government must provide employment within 15 days.
- Women’s Empowerment: Encourages active participation of women in the workforce, with efforts to ensure at least 50% of workers are women, contributing to women’s empowerment and addressing gender disparities.
- Transparency and Accountability: Emphasises transparency through social audits and proactive public disclosure. The Gram Sabha conducts regular social audits of projects to ensure accountability.
- Use of Technology: Employs technology like the Electronic Fund Management System (e-FMS) for direct bank transfers to workers, reducing corruption and improving efficiency.
- Aadhaar-Based Payment System (ABPS): Wages are disbursed using ABPS, where workers receive payments through their unique Aadhaar number as their financial address.
- Project UNNATI: A skilling project aimed at upgrading the skill base of MGNREGA beneficiaries to improve their livelihoods and transition from partial to full-time employment.
