With the demand for work under the Mahatma Gandhi National Rural Employment Guarantee Scheme (NREGS) continuing to be above the pre-pandemic level, the government has formed a panel to review the popular scheme with the intent to improve its efficacy in addressing poverty.
The panel would examine expenditure trends across various states and identify reasons for variations in expenditure and would also redesign work opportunities available under this scheme, Nagendra Nath Sinha, secretary, ministry of rural development, told FE. “It will also recommend institutional mechanisms, including governance and administrative structures, for more effective utilisation of the funds,” he added.
The nine-member expert panel, headed by Amarjeet Sinha, former secretary in the ministry, will give its report in three months.
In 2021-22, Rs 0.98 trillion was spent under MG-NREGS and in the current year, `0.73 trillion has been budgetted for the job guarantee scheme. The government had spent a record Rs 1.1 trillion under NREGS in FY21 as it used it to address the rural distress caused by the pandemic.
Though the fiscal cost of the scheme is huge, the government has been liberal with the outlay for the scheme, but concerns have been expressed by some quarters about the scheme’s alleged misuse in certain pockets of the country. Although the high level of rural employment justifies the elevated demand for the scheme, the government wants to ensure that each rupee spent on the scheme is well spent and the reaches the intended beneficiary.
Sources said that the NREGS spending in economically poorer states such as Bihar and Odisha has been lower than states such as Rajasthan and Tamil Nadu, which have higher per capita income. The review of the scheme is also aimed at ensuring that poorer regions get a fair share of the resources.
During the Covid-19 pandemic, the demand for work under NREGS rose sharply. According to official data, person days of work generation rose to 3.8 billion in 2020-21 from 2.65 billion in the previous fiscal. The person days stood at 3.63 billion in 2021-22.
While additional allocations under the scheme in the form of supplementary demands have been common in the last few years. In the last two years and in the current year, 80-85% funds provided in the Budget for MG-NREGS were exhausted within the first six months of the respective year.
Reflecting the bleak jobs scenario in the rural sector, households demanding work under the rural employment guarantee scheme continue to be above the October 2019 (pre-pandemic) level. Of course, demand for work from households has started slowing since its peak in June 2022.
MG-NREGS is a demand-driven scheme for the enhancement of livelihood security of the households in rural areas by providing at least one hundred days of guaranteed wage employment to every household whose adult members volunteer to do unskilled manual work, in every financial year.
However, against the mandate, a household, on an average, has received only 33.6 days of work until September end so far in the current fiscal against the last fiscal’s tally of 50.07 days, indicating some regulation in release of funds.
The scheme allows workers to be associated with various assets-creation activities such as road construction, ponds, rejuvenation of water bodies, among others.