Even as more than three fourths of the budget outlay for the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) has already been spent, and the demand remains somewhat elevated, the government is unlikely to make any additional allocation for the scheme anytime soon. A review of the funding requirement for the scheme will be undertaken when the overall budget is reviewed in November to arrive at the revised estimates, an official source said.
The Centre has released Rs 46,074 crore or nearly 77% of the budget estimate of Rs 60,000 crore for MNREGS in FY24.
“Even though it appears so much funds have been utilised, that’s not actually the case… there is no immediate shortage of funds. There was also some write-back of funds from the previous year,” an official told FE.
As against the availability of Rs 52,439 crore (including some writeback of funds from the previous year) as on August 18, the expenditure/releases stood at Rs 50,893 crore or 97% of the available funds with the rural development ministry.
The ministry data showed that during April-July 2023, work provided was a constant 9% lower than work demanded in each of these months.
As against work demand by 33.7 million households in June, 30.6 million got work. In July, 20.9 million households got work as against demand by 23.4 million. Data till August 18, showed that less than half of the 1.5 million households, which demanded work, got employment under the scheme.
The rural development ministry recently told Parliament that no additional funds have been sought from the Ministry of Finance under MNREGS as on August 4, 2023.
MGNREGS is a demand-driven wage employment Scheme under which states furnish funds release proposals to the Centre. The rural development ministry releases funds periodically in two tranches with each tranche consisting of one or more installments, keeping in view the “agreed to” Labour Budget, demand for works, opening balance, pace of utilization of funds, pending liabilities, overall performance and subject to submission of relevant documents by the States.
Central Government is making wage payments for unskilled components directly into the Bank/Post office accounts of the beneficiaries as per the Direct Benefit Transfer protocol through National Electronic Fund Management System (NeFMS) and funds for material components are released to the State Treasury under the Scheme. States have to make payments to skilled and semi-skilled workers through the material head.