Govt to tell banks to speed up MGNREGA wage payout after worker complaints

After getting large-scale complaints of workers for not getting payment on time despite early release of funds

The Centre is likely to ask all heads of banks, particularly those with extensive rural networks, to expedite payment of wages under MGNREGA (Mahatma Gandhi National Rural Employment Guarantee Act). This follows large-scale complaints of workers not getting payment on time despite early release of funds.

The government has also directed banks to speed up the process of stage-two clearance of funds — from banks to the beneficiary accounts — according to a senior official. Obtaining the stage-two clearance is seen as a primary hurdle in the timely payment of wages under the scheme.

The Centre claims that since April 2017, almost 85 per cent of the MGNREGA wages have been generated within 15 days of preparation of the muster roll.

If payment is not made on time, workers are entitled to a compensation for each day of delay till the wages are deposited in their bank accounts. However, activists claimed that on ground, the situation was very different and an incorrect delay calculation method was being used to show timely payment.

They pointed out that the Centre, in its master circular of 2017-18, has said that Management Information System (MIS) is designed to calculate delays only up to the time the Fund Transfer Order (FTO) is generated by the state government for the second time.

FTO is an electronic voucher which is generated by the MGNREGA software, which lists the name of a worker, along with the amount of wage payable to him, calculated on the basis of the work done. 

Estimating delays from the time of generation of FTOs, instead of when the wage is credited into a bank account ensures that wage payment improves only on paper, activists said. “We haven’t changed any delay calculation method and are continuing with what has been followed so far,’’ an official countered. But, the Centre is looking at all the accusations and trying to find out the reasons for delay, he added. 

As a follow-up measure, the government is planning to send teams of senior officials to districts where the problem of delayed payment has been identified. 

Also, the government could possibly bring uniformity in the schedule of rates under MGNREGA as per the minimum wages for calculation of output based on time and motion series.

Special teams have already been deputed to conduct internal audit of MGNREGA work and assets on a regular basis. The move is to avoid any time lag that is usually associated with CAG audits.