Work under MGNREGS: Women workers start grit work under the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) in Nidigattu village near Bheemunipatnam in Visakhapatnam district on 23 April 2020 | Photo credit: DEEPAK KR
From being branded a “living monument to failure” to “dig holes”, the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) has long been the subject of harsh criticism from the regime in power. Although the NDA government did not abolish the system inherited from the UPA, payment delays, technological imposition and lack of funds left the program in a state of disrepair.
For example, the Center has yet to pay salaries worth thousands of crores in West Bengal and Rajasthan. The recently introduced Aadhaar Based Payment System (ABPS) will reach almost 80% of workers in Maharashtra who have yet to complete the necessary formalities. In addition, the budget allocated to the program has been reduced by 33% for FY24.
Despite the steep cut, Union Rural Development Minister Giriraj Singh recently claimed that the allowances were higher than what had been granted under the UPA scheme. Chart 1 shows that the allocation was only 1.3% of the total budget in FY24, the lowest on record. The share peaked at 3.4% in fiscal 2009.
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From February 1, 2023, payments to MGNREGS beneficiaries were to be made only through ABPS. However, as of February 20, only 44% of total workers in India were eligible for ABPS. In 14 states, more than 50% of workers were not eligible. In Rajasthan, Uttar Pradesh, Bihar and Maharashtra, where more than 2 million workers each are enrolled in the scheme, more than 60% were ineligible. Chart 2 shows the share by state of workers who were ineligible to receive payments through the ABPS as of February 20. States have been divided into four categories based on the number of workers registered with MGNREGS.
Azim Premji University faculty member Rajendran Narayanan said, “Until workers link their work cards and bank accounts to Aadhaar, they will not be allowed to accept work from MGNREGA. This can have serious consequences as it takes time to do this process and it is high season for MGNREGA. Moreover, rectifying errors in Aadhaar-based payments is next to impossible for field workers and managers. »
The MGNREGS also suffers from excessive delays in the payment of salaries. The payment process has two steps. Step 1, which is the states responsibility, is to create a funds transfer order with worker details. This is sent in digital format to the Centre. Step 2, which is the responsibility of the Centre, is to process the funds transfer orders and transfer the salary to the worker’s account. Chart 3 shows salaries (in Rs. crore) which have not yet been processed by the States and salaries which have not yet been approved by the Center as of 25 February. For example, in Rajasthan, almost Rs. 78 crores or 1.5% of the total transactions are yet to be processed at the state level, while the Center has yet to settle dues worth Rs 1,138 crores or 18% of all transactions. In West Bengal, nearly 98% of transactions worth Rs. 2,897 crore are pending with the Centre.
Additionally, several states such as West Bengal, Madhya Pradesh, Tamil Nadu, Andhra Pradesh, Maharashtra and Nagaland are showing negative balances with pending payments for salaries and materials. It is therefore difficult for them to accept a new job. Meanwhile, they have pending payments ranging from Rs. 200 crore to over Rs. 1,000 crore. In Gujarat, Telangana, Bihar, Rajasthan and Uttar Pradesh, while the existing balance is positive, pending payments far exceed the balance, which if cleared will push states into territory negative. Chart 4 shows the remaining balance with states and payments due in rupees. crore.
Source: GIS reports, budget documents and Ministry of Rural Development
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