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LATEST NEWS UPDATES | MGNREGA faces fund crunch, wage payment delays, & low wage rates, allege civil society activists

MGNREGA faces fund crunch, wage payment delays, & low wage rates, allege civil society activists

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published Published on Oct 29, 2018   modified Modified on Oct 29, 2018
-Press Release by NREGA Sangharsh Morcha, dated 28 October, 2018

TheMahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) is meant to be demand-driven in the sense that work should be made available to anybody on demand for a maximum of 100 days per year per household. This implies that there cannot be arbitrary cap on the budgets. However, the programme has been made supply-driven and stifled due to -- (a) Insufficient budgets, (b) Lack of timely payment of wages,and (c) Low wage rates, among others.

Insufficient Budgets

Atan average cost per day person of Rs 255.08 and including pending liabilities of Rs 8707 crores from previous years, the allocation for 2018-19 should at least be Rs 74,805 crores. However, the total available budget in 2018-19 is only Rs 50,480 crores. As on 22nd October, 2018, about Rs 39,825 crores have already been spent. The totalpayments due for this financial year (FY) is Rs 3668 crore. Thus about 86% of the available funds for MGNREGA in this FY have already been spent. We still have 5 months left in this FY.

Contrary to lofty claims of “highest ever budget for MGNREGA” made by the Finance Minister, after adjusting for inflation, the MGNREGA fund allocations have actually decreased over the years.  Independent estimates had indicated that at least 1.7% of the GDP needs to be allocated for the programme to run robustly. In reality the allocation has only been around 0.25% of the GDP in each of the last 5 years. The inflation-adjusted budget for 2018-19 is much lower than in 2010-11. This is even more pitiful as the Centre claims that the tax to GDP ratiohas been increasing and so the reasons for the gross underfunding of the Act is unacceptable. Table 1 in the annexure gives the MGNREGA budget over the years as a percentage of GDP.

Please click here to access the entire press release.

Press Release by NREGA Sangharsh Morcha, dated 28 October, 2018,


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