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LATEST NEWS UPDATES | Aadhaar linking cuts NREGS wage delays, fund transfers double too -Rajeev Deshpande

Aadhaar linking cuts NREGS wage delays, fund transfers double too -Rajeev Deshpande

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published Published on Jun 27, 2018   modified Modified on Jun 27, 2018
-The Times of India

NEW DELHI: Linkage of MGNREGS accounts with an Aadhaar-linked payment (ALP) system significantly boosted efficiency of wage transfers, doubling funds transferred and increasing work allotted in times of distress as compared to previous years when demand actually dropped during economic stress due to leakage and delays in payments.

An Indian School of Business study that examined annual data for blocks which had drought conditions in financial years 2012-2017 showed clear changes in the pre- and post-ALP system with regard to work generated, individuals and households benefited and the speed and volume of bank transfers that point to an increased uptake of the workfare programme.

On a broad scale, irrespective of distress conditions, there was an increase of over Rs 2 crore in amount disbursed in banks after ALP. There was a manifold rise in direct transfer beneficiaries with funds transferred in FY 2015 totalling over Rs 9 crore and the figure rising to Rs 14 crore in FY 2016, a 50% jump in a year.

In the post-ALP period, the average of individuals and households allotted work increased by 12,597 and 7,579. In the pre-ALP period, households and persons demanding work declined across blocks facing drought — delayed payments and leakages made those seeking succour look for more immediate, even if less paying, options to tide over the bad times.

“We have looked at the annual data and analysed distress in terms of a 75% or 50% deficiency of rainfall and also in terms of high temperatures. These can be seen to be conditions that cause rural distress,” said ISB’s Prof Ashwini Chhatre, who said ALP made the scheme “counter cyclical” — higher demand in times of economic distress.

This was in contrast to the scheme being “cyclical” (demand dropping when economic activity shrinks) which defeated the purpose of MGNREGS. The target population seemed to have learned of quicker payments with the provision of jobs becoming counter cyclical, with an increase of 625.62 (households) and 2,492.84 (persons) allotted work. When compared to an average of 7,477 households and 12,433 individuals, there was an increase of 8.5% and 20%.

The study, ‘A Friend Indeed: Does the Use of Biometric Digital Identity Make Welfare Programmes Counter-Cyclical’, was authored by Shradhey Parijat Prasad, Nishka Sharma and Prasanna Tantri. “The magnitude of increased work in distressed blocks is higher in post-ALP. We also find that the total muster rolls filled and total persons worked increases in distressed block years only after implementation of ALP,” they wrote.

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The Times of India, 27 June, 2018, https://timesofindia.indiatimes.com/india/aadhaar-linking-cuts-nregs-wage-delays-fund-transfers-double-too/articleshow/64755621.cms


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