71% MGNREGA wages not paid on time, 14% delayed beyond 30 days, study shows

The study done on 1.8 mn transactions between April and September, by LibTech India and the People's Action for Employment Guarantee (PAEG)

Despite claims of timely payment of MGNREGA wages, a new study has shown that wage payments were delayed for 71 per cent of the transactions beyond the mandated seven days, 44 per cent of the transactions beyond the mandated 15 days and 14 per cent of the transactions beyond the mandated 30 days.

The study was conducted on about 1.8 million transactions between April 2021 and September 2021 by randomly sampling 10 percent of the Fund Transfer Orders (FTOs) from one block per district per state for 10 states. It was conducted by LibTech India and the People’s Action for Employment Guarantee (PAEG).

LibTech India is a team of engineers, social workers, and social scientists who, inspired by the Right to Information movement and the idea of social audits, focus on various aspects of improving transparency, accountability, and democratic engagement in rural public services delivery.

Normally, the MGNREGA payment process consists of 2 Stages.

After work is completed, a Funds Transfer Order (FTO) with worker details is digitally sent to the Central Government by panchayat/block.

This is called Stage 1 and it’s the state’s responsibility.

The Central government then processes the FTOs and transfers wages directly to the workers’ accounts. This is called Stage 2 which is entirely the Central government’s responsibility.

As per the Act’s guidelines, Stage 1 must be completed in 8 days and Stage 2 must be completed within 7 days after Stage 1. Workers are entitled to delay compensation for each day’s delay beyond 15 days.

The study meanwhile, also showed that some of the poorer states suffer higher delays.

Stage 2 for nearly two-thirds transactions in Jharkhand exceeded 15 days. Stage 2 for half or more than half of the transactions of Madhya Pradesh, Chhattisgarh, and West Bengal exceeded 15 days.

In March 2021, the Central government segregated payment of wages based on the caste category of workers.

They are at odds with the universal nature of the programme. Caste based payments create very little protection for marginalized communities. On the contrary, it has increased the work of block officials and fractured communities across caste and religious lines.

The study also showed that Stage 2 for 46 per cent of the wage payments to SCs was completed in the mandated 7-day period and Stage 2 for 80 per cent of the wage payments to SCs was completed in 15 days. This was 37 per cent and 63 per cent for STs.

For the ‘Other’ category, only 26 per cent payments were completed in 7 days and only 51 per cent payments were completed in 15 days.

The difference in Stage 2 by caste was highest in September, the study showed.  “The Centre stands in contravention of the Act and Supreme Court orders by not paying the delay compensation payable to workers due to Stage 2 delays,” the study showed.

“What we are seeing are at least three different yet connected issues. First, the continued delays in payment of wages. Second, arbitrary technological interventions in the payments process whose conceived rationale and observed outcomes are at odds and third is difficulties faced by workers and officials alike in resolving payment related grievances owing to adoption of opaque technical architecture,” the study said.