92% of funds for wage payments under MGNREGA raised, says govt

Activists claim that of the allocated Rs 550 bn for FY19, 86% already spent with five months still left

Days after civil society activists said an insufficient budget, along with delayed payment and low wages, had crippled the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) in the past few years, the Centre on Tuesday refuted the allegation.

The Centre said in 2018-19 almost 92 per cent of wage payments had been generated on time and extra funds were being released this week out of the budget of Rs 550 billion. The MGNREGA Sangharsh Morcha, in a statement earlier this week, said of the allocated Rs 550 billion for 2018-19, around 86 per cent had been spent when there were five months left in the year.

It said considering an average cost per day of Rs 255.08 and including pending liabilities of Rs 88 billion from the previous year, the 2018-19 Budget allocation should have been at least Rs 748 billion. 

“A typical pattern observed every year is that funds get exhausted midway through the year. There are two big consequences of this — first, block-level field functionaries of the MGNREGS don’t register demand for work in the MGNREGS management system (MIS), and, secondly, it leads to massive accumulation of pending wages,” the Morcha said.

The government replied to this by saying that so far of the allocated Rs 550 billion around Rs 440 billion had been released while the remaining amount will be disbursed soon.  That apart, there is Rs 30-40 billion from internal savings, which will be channelled into the scheme and more allocation through supplementary demands for grants could be released in next few months. 

“We have sent a requisition to the finance ministry for additional funds and it is being worked out,” a senior official said. Civil society also questioned the Centre’s claim of ensuring over 90 per cent timely payments on the grounds that despite repeated orders, the government’s MGNREGA MIS continued to capture only stage 1 delays, that is delay from the time taken by the blocks to generate an electronic pay order called Funds Transfer Order (FTO), while the system did not capture delays in releasing wages after receiving FTOs.

“This makes the ‘payment on time figure’ used by the ministry meaningless,” the Sangharsh Morcha said.

The ministry said so far in 2018-19, around 92 per cent wage payments had been generated within 15 days while this percentage was just 26.85 per cent in 2014-15.   

Civil society activists also said wages should be at par with what the Seventh Pay Commission recommended. In real terms they are less than statutory minimum agricultural wages in several states, they said. 

The Centre responded by saying MGNREGS wages were linked to Consumer Price Index-Agricultural Labour, which has a higher share of food items. 

It is working on linking MGNREGS wages to CPI-Rural, which has a more balanced share of food and other items.