Making MGNREGA Work

Context: Making Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) work by sustaining recent performance records and fixing the shortcomings.

Performance records of MGNREGA in 2020-21

• Total allocation of Rs 1.1 trillion.
• 8 million Households got their full quota of 100 days of employment.
• The average duration of employment per worker increased to 52 days, against the past five years’ average of 40 to 42 days.
• On the whole, about 110 million persons got employment.
• 3,900 million person-days of work generated.

Shortcomings of MGNREGA

• Payment issues:  Delay in paying wages and lack of any recompense for belated payment defeats the very purpose of the scheme. There is also a lack of any recompense for belated payment.
  • According to a survey by LibTech India, workers spend a third of their weekly MGNREGA wages on withdrawing money from banks and pay multiple visits to the banks to encash the cheques.
  • Despite the highest-ever allocation of Rs 1.1 trillion in FY21, including the record Rs 78,000 crore earmarked specifically for wages, more than Rs 17,000 crore was carried forward to the subsequent financial year as unpaid dues.
• Absence of a grievance redress mechanism.
• Poor planning and execution of works: Ultimately lead to poor asset creation and meagre returns on the huge investment.
  • The project, thus, remains just a sustenance-oriented safety net for the poor without turning into a catalyst for socio-economic development in rural areas.

Way forward: Structural and operational reforms

• Simplify mechanism of wage disbursement: For e.g. by creating payment outlets closer to the workers’ residences or worksites.
• Integrate MGNREGA with other ongoing employment-intensive activities: like infrastructure construction, soil and water conservation works, and providing piped water to rural households.