Union Budget 2021: Reduced MG-NREGS outlay for FY22 may not suffice to meet demand

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February 3, 2021 1:10 AM

Union Budget 2021 India: A total of 322.11 crore person days of work have been created under the Mahatma Gandhi National Rural Employment Guarantee Scheme (MG-NREGS) so far in the current fiscal with a total expenditure of Rs 89,664 crore.

MGNREGA,economyHowever, JNU professor Himanshu believes that the allocation will fall short since demand for work will still remain high in the next fiscal.

Indian Union Budget 2021-22: The Rs 73,000-crore Budget allocation under MG-NREGS for FY22, a dip of 34.5% compared with FY21, will suffice to fund only around 260 crore person days of work, going by the current year’s average daily cost of Rs 279.52 for each person taking up job under the rural employment guarantee scheme.

A total of 322.11 crore person days of work have been created under the Mahatma Gandhi National Rural Employment Guarantee Scheme (MG-NREGS) so far in the current fiscal with a total expenditure of Rs 89,664 crore.

Sources in the government said Rs 73,000 crore allocated for 2021-22 would be enough to meet the entire demand for MG-NREGS jobs for the year which is forecast to have a normal monsoon and very little impact of the pandemic on the economy and thus, is expected to provide better remunerative job opportunities for rural youth elsewhere.

However, JNU professor Himanshu believes that the allocation will fall short since demand for work will still remain high in the next fiscal.

Traditionally, rural youth get better remuneration for their works, even for agricultural works, outside MG-NREGS, which is mainly a fallback option. While daily averages wages paid to a worker under MG-NREGS now stands at Rs 202; as per the Labour Bureau, a male general agricultural labourer got an average wage of Rs 307.48 daily in November 2020.

The 2020-21 fiscal is an exceptional one due to the pandemic. For 2020-21, the government had allocated Rs 61,500 crore (BE) to fund the MG-NREGS, but later raised the allocation in two tranches to Rs 1,11,500 crore for the demand-driven scheme.

Of the total, the Centre has so far released Rs 90,771.21 crore while total expenditure has been Rs 89,663.96 crore. Of the total expenditure, Rs 65,033.57 crore has been spent on wages, Rs 21,784.03 crore on material & skilled wages and Rs 2,846.37 crore on administrative expenses. A total of 322.11 crore person days have been created so far.

In 2019-20, as per the MGNREGA dashboard, the Centre had released Rs 71,020.35 crore out of which total expenditure was Rs 68,261.32 crore. Of the total expenditure, Rs 48,846.74 crore was spent on wages, Rs 16,188.69 crore on material & skilled wages and Rs 3,225.88 crore on administrative expenses.

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