UPSC Articles
MGNREGS running out of funds
Part of: GS Prelims and Mains II – Government policies and interventions for development; Welfare/Social schemes
About MGNREGA
- It stands for Mahatma Gandhi National Rural Employment Guarantee Act, 2005
- It guarantees 100 days of wage employment in a financial year to a rural household whose adult members (at least 18 years of age) volunteer to do unskilled work.
- It has unique legal architecture of being demand-driven, and not budget constrained.
- It is social security and labour law that aims to enforce the ‘right to work’.
- It has provision for unemployment allowance, when the state cannot provide work
- Agriculture and allied activities constitute more than 65% of the works taken up under the programme.
- MGNREGA has helped build rural infrastructure through approximately 10 crore families.
Problems facing MGNREGA
- Governments capping its financial resources and turning it into supply-based programme
- Workers had begun to lose interest in working under it because of the inordinate delays in wage payments.
- With very little autonomy, gram panchayats found its implementation cumbersome
- As a result, over the last few years, MGNREGA had begun to face an existential crisis.
New concerns:
- The Scheme has already used up almost half its allocated funds.
- It spent more than ₹48,500 crore out of the expanded ₹1 lakh crore allocation announced (during COVID outbreak)
- In several Gram Panchayats, the approved projects have already been exhausted.
- A number of gram panchayats in vulnerable areas have already exhausted their funds for the scheme.
Measures needed:
- Centre should allocate another ₹1 lakh crore to the scheme
- It has to double the permitted work limit to 200 days per household.
