Dearth of Funds In MGNREGA 

The Centre’s flagship rural employment scheme (MGNREGA) has run out of funds halfway through the financial year. This means that payments for MGNREGA workers as well as material costs will be delayed, unless the States dip into their own funds.

MGNREGA Scheme

The Mahatma Gandhi National Rural Employment Guarantee Act, earlier known as the National Rural Employment Guarantee Act was passed in 2005 to augment employment generation and social security in India.

The scheme is a demand-driven wage employment scheme, which functions under the Ministry of Rural Development.

Every adult member of a household in a rural area with a job card is eligible for a job under the scheme.

The scheme envisages providing 100 days of guaranteed wage employment in a financial year to adult member volunteers for unskilled manual work.

It covers all districts of India except the ones with 100% urban population.

There is also a provision for additional 50 days of unskilled wage employment in drought/natural calamity notified rural areas.

As per Section 3(4) of the MGNREGA, the States may make provisions for providing additional days beyond the period guaranteed under the Act from their own funds.

Issues With MGNREGA

Ridiculously Low Wage Rate

Currently, the MNREGA wage rates of at least 17 of the 21 major states are even lower than the state minimum wage for agriculture. The shortfall is in the range of 2-33% of the minimum wage.

The National Sample Survey Office (NSSO), 2017 data shows that the average daily wage for general agricultural labourers is Rs. 264.05 for men, and Rs. 205.32 for women.

The ridiculously low wage rates have resulted in lack of interest among workers in working for MGNREGA schemes, making way for contractors and middle men to take control locally

Inadequate Financing

Due to lack of funds, state governments find it difficult to meet the demand for employment under MGNREGA

Delay In Payment of Wages

Most states have failed to disburse wages within 15 days as mandated by MGNREGA. In addition, workers are not compensated for a delay in payment of wages.

This has turned the scheme into a supply-based programme and subsequently, workers had begun to lose interest in working under it.

A 2016 judgement of the Supreme Court described pending wage payments under MGNREGA as “a clear constitutional breach committed by the State” and “a modern form of begar”.

Ineffective Role of PRI

With very little autonomy, gram panchayats are not able to implement this act in an effective and efficient manner.

Large Number of Incomplete Works

There has been a delay in the completion of works under MGNREGA and inspection of projects has been irregular. Also, there is an issue of quality of work and asset creation under MGNREGA.

Way Forward 

Must Ensure Work is Provided

The government must ensure that work is provided notwithstanding the demand.

The government should expand the scheme and focus on value addition and multiply community asset works.

Strengthening the Scheme

There is a need for better coordination between various government departments and the mechanism to allot and measure the work

Gender Wage Gap

Some discrepancies in the payouts need to be addressed, too. Women in the sector, on an average, earn 22.24% less than their male counterparts.