MGNREGA

Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA)

Latest Update about MGNREGA – The Union government has allocated Rs.72000 crores for The Mahatma Gandhi National Rural Employment Guarantee Act, (MGNREGA) scheme in 2021-22.

Quick Facts about MGNREGA 2021:

MGNREGA Full Form	Mahatma Gandhi National Rural Employment Guarantee Act
When the MGNREGA Scheme officially launched?	2nd February 2006The Mahatma Gandhi National Rural Employment Guarantee Act was passed on 23rd August 2005
What was MGNREGA earlier called?	It was known to be National Rural Employment Guarantee Act
Are MGNREGS and MGNREGA the same?	MGNREGS is a scheme which is based on the MGNREGA (Act)
Number of Districts covered under the MGNREGA Scheme?	As of 11th February 2021; 708 districts are covered
Key Stakeholders under MGNREGA	Wage seekersGram Sabha (GS)Three-tier Panchayati Raj Institutions (PRIs)Programme Officer at the Block levelDistrict Programme Coordinator (DPC)State GovernmentMinistry of Rural Development (MoRD)Civil SocietyOther stakeholders (In line departments, convergence departments, Self-Help Groups (SHGs)
What is MGNREGA Job Card?	It is a document that renders a worker entitled for work under the MGNREGA Scheme
Mandate of Mahatma Gandhi NREGS	Provision of at least 100 days of work that provides guaranteed wage in a financial year
MGNREGA Official Website	https://nrega.nic.in/netnrega/home.aspx

MGNREGA & Workers Crisis – COVID Pandemic

Finance Minister Nirmala Sitharaman on March 26th, 2020, the workers under the MGNREGA would get a hike of Rs. 2000 each on an average. It was also announced that three crore senior citizens, persons with disabilities, and widows will get a one-time additional amount of Rs 1,000 in two installments which will be provided through DBT (Direct Benefit Transfer) over three months. This announcement was made as an initiative towards the loss caused by the Covid-19 outbreak. The 21 days lockdown was expected to cost the Indian Economy a cost of around 9 lakh crores.  Funds worth Rs 31,000 crore are also to be provided to augment medical testing, screening, and providing better healthcare facilities to those who have been affected financially due to the Covid-19 outbreak.

MGNREGA History:

In 1991, the P.V Narashima Rao government proposed a pilot scheme for generating employment in rural areas with the following goals:

• Employment Generation for agricultural labour during the lean season.
• Infrastructure Development
• Enhanced Food Security

This scheme was called the Employment Assurance Scheme which later evolved into the MGNREGA after the merger with the Food for Work Programme in the early 2000s.

Objectives of MGNREGA:

The Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) has the following objectives:

• Provide 100 days of guaranteed wage employment to rural unskilled labour
• Increase economic security
• Decrease migration of labour from rural to urban areas

MGNREGA differentiates itself from earlier welfare schemes by taking a grassroots-driven approach to employment generation. The programs under the act are demand-driven and provide legal provisions for appeal in the case, work is not provided or payments are delayed. The scheme is funded by the central government which bears the full cost of unskilled labour and 75% of the cost of material for works undertaken under this law. The central and state governments audit the works undertaken under this act through annual reports prepared by CEGC (Central Employment Guarantee Council) and the SEGC (State Employment Guarantee Councils). These reports have to be presented by the incumbent government in the legislature.

A few salient features of the scheme are:

• It gives a significant amount of control to the Gram Panchayats for managing public works, strengthening Panchayati Raj Institutions. Gram Sabhas are free to accept or reject recommendations from Intermediate and District Panchayats.
• It incorporates accountability in its operational guidelines and ensures compliance and transparency at all levels.

Ever since the scheme was implemented, the number of jobs has increased by 240% in the past 10 years. The scheme has been successful in enhancing economic empowerment in rural India and helping overcome the exploitation of labour. The scheme has also diminished wage volatility and the gender pay gap in labour. This can be substantiated the by the following data available at the official site of MGNREGA:

1. 14.88 crores MGNREGA job cards have been issued (Active Job Cards – 9.3 crores)
2. 28.83 crores workers who gained employed under MGNREGA (2020-21) out of which active workers are 14.49 crores.

What is the role of Gram Sabha and Gram Panchayat in MGNREGS?

The role of Gram Sabha in the Mahatma Gandhi National Rural Employment Guarantee Scheme is tabled below:

Role of Gram Sabha in MGNREGS

It lists down the works priority-wise w.r.t the potential of the local area

It monitors the work executed within the Gram Panchayat

It acts as the primary forum for the social audits

It also works as a platform to resolve all workers’ queries related to any MGNREGA work

The role of Gram Panchayat in the Mahatma Gandhi National Rural Employment Guarantee Scheme is tabled below:

Role of Gram Panchayat

It is authorized with the role to receive the job applications

After receiving the applications, it is responsible to verify them

All household are registered by the Gram Panchayat

The MGNREGS job cards are issued by the Gram Panchayat

It is responsible to allot work within 15 days from the application submission

It prepares an  annual report that covers the achievement of the scheme

It holds Rozgar Diwas at every ward once a month

Role of State Governments in MGNREGS

The important roles of the state government in executing the MGNREGA scheme are:

1. It frames rules charting out state’s responsibility under the act.
2. It sets up the State Employment Guarantee Council.
3. State Employment Guarantee Fund (SEGF) is established by state governments.
4. It makes sure to dedicate Employment Guarantee Assistant (Gram Rozgar Sahayak), the PO and the staff at State, district, cluster and Gram Panchayat level; for the execution of the scheme.

MGNREGA – State Employment Guarantee Council (SEGC)

The State Employment Guarantee Council is responsible to advise state government for the implementation of the MGNREG scheme. Some important functions of SEGC under MNREGS are:

1. The suggestion of improvements in the execution of the scheme.
2. Evaluation and monitoring of the scheme.
3. To recommend proposals of the works to the central government.
4. To aware the districts about the scheme and its features.
5. To prepare an annual report to be submitted by the state government before the state legislature.

This law and the employment guarantee schemes which are part of its provisions are important from the IAS exam point of view. UPSC aspirants should read about this government scheme in detail as questions related to this topic are asked in the Prelims exam and in General Studies paper II. The questions for government schemes like MGNREGA are classified under Welfare schemes, and the topic has a significant overlap with topics like human development, poverty, and hunger.

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MGNREGA: The Contribution to Strengthening the Rural Economy

The Union Government earlier announced the wage rate increase of overall Rs 2000 per worker i.e. from Rs 182 it is increased to Rs 202, to benefit 5 Cr families. The local district commissioners are empowered to allocate the work and accordingly utilize the fund, depending on the requisites in his area to benefit the rural workers, provided the social distancing norms respected. And recently, Union government has announced setting up of Expert Committee under the chairmanship of Ajit Mishra on fixation of Minimum Wages and National Floor level Minimum Wages.

What is MGNREGA?

• The Mahatama Gandhi National Rural Employment Guarantee Act (MGNREGA) is a law whereby any adult who applies for employment has to be given a guarantee of 100 days of work on local public works within fifteen days of registration. If employment is not given, then the unemployment allowance has to be paid.
• The Act enacted in 2005 is regarded as the largest work guarantee program in the world, guarantees 100 days of wage employment per year to rural households. Roughly one-third of the stipulated work force must be women.

Note: Previously, this social security scheme was called as ‘National Rural Employment Guarantee Act, but after April 2008, it was renamed as Mahatma Gandhi National Rural Employment Guarantee Act. Presently, the minimum number of days of work have been increased up to 150 days.

The objective of the MGNREGA Scheme

• It aims at addressing the causes of chronic poverty through the works that are undertaken and ensuring sustainable development.
• The Act was introduced with the aim of improving the purchasing power of the rural people, primarily semi or un-skilled work to people living below the poverty line in rural India.
• It also aims to strengthen the process of decentralization and empowers Panchayati Raj Institutions (PRIs) for the planning and implementation of these works.

The social security scheme is backed by the Govt of India. It provides employment and livelihood to rural laborers in India. As the person seeking work under the MGNREGA must be registered under the gram panchayats. Therefore, a person has to first enroll himself in this scheme to obtain the work.

Key features of MGNREGA:

The Ministry of Rural Development under the Government of India is monitoring the entire implementation of this scheme in association with State Governments.

1. Decentralized planning: Panchayati Raj Institutions are primarily responsible for planning, implementation, and monitoring of the works that are allocated and implemented. Gram Sabhas are empowered to undertake the recommendation of the work and at least 50% of the works must be executed by them.
2. Application Procedure: Adult members of rural households submit their name, age and address with photo to the Gram Panchayat. The Gram Panchayat registers households after making inquiry and issues a job card. The job card includes the complete details of adult members enrolled and his /her photo. A registered person can submit an application for work in writing (for at least fourteen days of continuous work) either to Panchayat or to Programme Officer.
3. Time-bound work allowance or unemployment allowance: Anyone meeting the criteria to obtain the work, if approaches for getting the work, must be given the work within 15 days of their application, failing which an ‘unemployment allowance’ must be given.
4. Funding aspects: the fund is shared between the center and the states. There are three major items of expenditure-
   1. Wage- unskilled, semi-skilled and skilled labor,
   2. Material cost,
   3. Administrative cost
5. On 03 June 2021, the Government of India decided to provide separate budget heads for SC and ST categories under MGNREGS from the financial year 2021-22 for wage payment. However, Workers’ rights advocates said this will complicate the payment system, and expressed fears that it may lead to a reduction in scheme funding.

The central govt has to take care of 100% of the unskilled labor, 75% of the cost of materials, 75% of the cost of semi-skilled and skilled laborers, and 6% of the administrative costs. 

1. Work-site facilities: Under the MGNREGA working ambiance, there is a provision of all work site facilities such as creches, drinking water, and first aid.
2. Transparency and accountability: Social audits are conducted by gram sabhas to enable the community to monitor the implementation of the scheme. it is a way of measuring, understanding, reporting and improving an organization’s social and ethical performance. Also, it helps to narrow the gap between vision, goal and reality. Other measures include:

1. National electronic Fund Management System (NeFMS): At the Panchayat level officials has been given training in using the electronic system developed by the National Informatics Centre (NIC). NeFMS is meant to reduce the delay in funds to the workers to meet their daily needs. Aadhar card is linked so chances of corruption are less. Under the NeFM system, the workers will get the payment within 48 hours from the moment gram panchayats generate an order.
2. Grievance redressal mechanism: State-level officers have been designated to monitor the disposal of complaints in the state. Also, complaint boxes at district levels have been installed.
3. State quality monitor: It includes govt officials at the district level supervising the utilization of funds under the scheme.
4. National level monitors: it consists of retired as well as serving civil servants to monitor the policy and implementation of the program at the national level.

How the scheme is implemented?

India is administratively divided into States and Union Territories. Each state has districts, then within districts there are blocks and within blocks have wards. Under this scheme employment related to public work at the block, the level is given. The funds are released by central govt to the states. States then give the funds to local bodies i.e. gram panchayats. All the laborer’s accounts are registered with the gram panchayats.

MGNREGA work allocation is directly linked to the Agriculture and allied activities. Majorly works are allocated concerning Publics work relating to Natural resource management, community assets or individual assets, common infrastructure works. Variety of permissible works which can be taken up by the Gram Panchayaths:

• Raising a block plantation in community lands i.e. planting of trees.
• Maintenance and building of check dams. Check dams are the small dams that are created in small reservoirs to check the flow of water.
• Building farm ponds
• Water absorption trenches at foothills to reduce soil erosions
• Digging of soak pits
• Restoration of irrigation ponds
• Construction of anganwadis, roads etc.

All these kinds of public works are given under the scheme. MGNREGA provides “Green” and “Decent” work. MGNREGA focuses on the economic and social empowerment of women. The Gram Sabha is the principal forum for wage seekers to raise their voices and make demands. It is the Gram Sabha and the Gram Panchayat which approves the shelf of works under MGNREGA and fix their priority.

What impact does MGNREGA has on the Indian economy?

With the implementation of MGNREGA, reports suggest that there have been significant changes in social fabric such as a reduction in distress migration, higher participation by SCs and STs population and improve in their purchasing power, Increase in average wages, equal wages for men and women economic empowerment of poor women, improvement in a rural environment and sanitation etc.

Over the years, MGNREGA has also caused a major financial drain on India’s economic resources. The actual benefits of this scheme do not reach to the rural labourers. In the process of funds transfer, there is a lot of irregularities that causes funds to shrink before it reaches its beneficiaries. Article 243 (G) empowers an MLA to decide whether or not Panchayats need to be empowered. This provision sometimes, make difficult for fund allocation.

NREGA has also been criticized for leakages and corruption implementation. But with the introduction of the Direct Beneficiary Transfer (DBT) system introduced by the central government, wherein, the workers get their payment directly into the bank account, the chances of corruption have gone down to great extent.