Wages to workers: MGNREGA's fluctuating fate during Modi government

Early in his tenure, Prime Minister Narendra Modi called the MGNREGA a “testimony” of the failures of the previous United Progressive Alliance government.

The rural employment scheme’s nature and the objective had come in for strong criticism and plans were afoot to change its characteristics, according to civil society activists.

Arun Jaitley, in his first Budget for the Modi government as Finance Minister, allocated Rs 34,699 crore to the scheme for 2015-16 and thereafter topped it up with Rs 7,000 crore through supplementary demand, making it the highest ever allocation for any year (Jaitley died in 2019 at age 66).

Thereafter, MGNREGA allocation has increased almost every year, reiterating the scheme's effectiveness in providing temporary jobs during distress which become of utmost during distress.

The scheme has been dovetailed with agriculture and water conservation, resulting in formation of lakhs of farm ponds and quality assets in rural areas.

Covid boost

However, the biggest boost to MGNREGA was during Covid-19 crisis when millions of workers migrated from cities to villages in search of livelihood as employment dried up due to the lockdown.

Data shows that in 2020-21 and 2021-22, almost 110 million individuals worked in the scheme which was the highest ever MGNREGS workers in a single year ever since the scheme started in 2006.

Before, the pandemic struck early 2020, on an average around 60-75 million labourers got temporary employment under the scheme annually. The number grew exponentially in the pandemic.

The Central government responded by massively hiking the budgetary allocation under the scheme to an all-time high of almost Rs 110,000 crore in 2020-21, followed by Rs 96,000 crore in 2021-22.

Since then the number of workers demanding work under the scheme has come down significantly as economic activities have resumed in full strength. But data shows that everything hasn’t yet come back to normal.

In FY24, more than 80 million individuals worked under the scheme – more than the pre-pandemic years. The total person days of work provided was also higher than FY23.

Both data points signify that though economic activities have come back to normal post the pandemic, the rural jobs market is still not completely out of the woods.

“I think the main reason (for a significant number of people still seeking menial jobs under MGNREGS) is that the economy has not entirely recovered from the shock of Covid-19. It is important to keep in mind that the formal economy did relatively well during the pandemic, but the same was not the case for the informal economy,” Amit Basole, professor of economics and head of Centre for Sustainable Employment at Azim Premji University in Bengaluru, told ‘Business a few months ago.

“Though agricultural production was not as badly affected as manufacturing or services during the pandemic, workers who lost jobs in other sectors ended up in agriculture or self-employment as fallback options. The fallback option includes MGNREGA. Hence, the share of agriculture and self-employment in the total workforce increased during the pandemic and for women, it is still higher than it was before Covid,” said Basole.

 

MGNREGA changes

The administration of MGNREGA has undergone a change since 2014. From mandatory Aadhar-based Payment System (ABPS) to app-based attendance to drone monitoring of the works, digital intervention in the scheme has grown manifold during the last 10 years. The change has its benefits and pitfalls.

The government says digital interventions and technology are meant to bring about transparency in the scheme and eliminate the problem of ghost workers. Civil society activists said the interventions have complicated MGNREGA, made its administration difficult, removed genuine workers and delayed wage payments.

Activists claim that scores of genuine jobs cards have been deleted from muster rolls in the name of weeding out fake beneficiaries.

Then came the big problem of administration of MGNREGA in West Bengal, which is ruled by Trinamool Congress (TMC).

As per a detailed reply made in Parliament a few months back, funds under MGNREGS to West Bengal have been stopped since March 9, 2022 as per provisions under Section 27 of the MGNREG Act, 2005 due to non-compliance of directives of the Central government.

Union rural development minister Giriraj Singh has alleged that West Bengal has issued 2.5 million fake MGNREGA job cards due to which crores of government money was siphoned off.

He said the central government had exposed rigging in the MGNREGA and Rural Housing Scheme in West Bengal, but the state government failed to take appropriate action.

Bengal was asked to submit a comprehensive action taken report but it did not, said Singh.

Finally, the State was informed that non-submission of ATR in time could also lead to withholding of funds under MGNREGA Act 2005.

After this, an ATR report, protecting the culprits, was presented by the state government.

When questions were asked, the state government was also unable to answer on the issues of corruption. “West Bengal Government is not at all cooperating with the Central Government in the investigation of corruption,” Singh said.

‘Funds stopped’

Meanwhile, a fact-finding team of civil society activists sent to West Bengal sometime back had found that the stoppage of funds was having a profound impact on the livelihoods of the poor.

The fact-finding report said that a majority of the workers we met complained that despite their willingness to work no work has been provided in FY 2022-23 under MGNREGA. Even those who received work have gotten only 6-12 days of work.

It said many MGNREGA workers, especially single women, reported that non-payment of wages have impacted food security. They often have to skip meals due to lack of resources.

“This autocratic decision amounts to the criminalisation and punishment of the entire 1.5 crore NREGS workers in the State for no fault of theirs. Practically no new work has been done in 2022-23, forcing workers to migrate and to cut down on essential expenses like food, medical expenses and education. The same fate awaits them in 2023-24,” the report had said.

Another point raised by civil society activists is the inadequate administration and funding of social audits which would have weeded out the corruption and mismanagement charge levelled against the scheme.

The fund allocation as per their estimate too remained inadequate in most years and was not front-loaded which killed genuine demand and artificially pulled down work need.

Whether these issues are addressed by a new central government assuming office after June 4 only time will tell.