New Delhi: The Centre has continued to underfund the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) in spite of the Ministry of Rural Development (MoRD) seeking more funds to meet the backlog of pending payments and demand for jobs in the last fiscal.
After the interim budget, announced in February, allocated only Rs 60,000 crore for the Centre’s flagship scheme, designed to respond to rural employment on demand, food rights activists and grassroots labour rights organisations expressed apprehensions. However, on July 5, finance minister Nirmala Sitharaman kept the annual budgetary allocation for 2019-20 unchanged.
While Rs 55,000 crore was allocated for the scheme in the 2018-19 union budget, it had to be topped up to Rs 61,084.49 crore to meet some of the shortfall faced by the MoRD. Though the ministry wanted an additional Rs 18,000 crore, only Rs 6,000 crore was granted, taking last fiscal’s total spending under the scheme to Rs 61,084.49 crore.
Effectively, in this budget, Sitharaman has reduced its allocation by Rs 1,084.49 crore.
In response to the interim budget allocation, civil society organisations had stated that there was about a shortfall of Rs 30,000 crore if factors like pending payment of wages to workers are taken into account. Mazdoor Kisan Shakti Sangathan (MKSS), in a press note, then pointed out that “any budget less than Rs 88,000 crore will be insufficient to meet even projected demand for work and timely payment of wages.”
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By February, unpaid worker wages stood at Rs 7,568 crore, MKSS said. “This means that even before the start of the new financial year in April (2019-20), the programme is effectively left with a budget of Rs 52,000. The true picture of funding for MGNREGA is, therefore, deliberately masked in the high-pitched budget announcements made in Parliament. The vicious cycle of pending liabilities and the mounting fund crunch can only be broken if the budget allocation for MGNREGA is substantially increased.” It pointed out that in the previous fiscal, the ministry exhausted its Rs 55,000 crore allocation before January 2019.
Speaking to the The Wire on Friday, activist Nikhil Dey said, “It came to such a pass last year that the MoRd had to tell the state governments to take a loan which will be paid back later.”
The MKSS activist said, “Despite inflation, drought conditions and pending liabilities, the programme has been shortchanged. Instead of raising its budget, the government is actually reducing it. MGNREGA has continued to face budgetary constraints. Every time a budget allocation is made, it is not enough. It is a criminal action as under the Act, the Centre is supposed to provide funding based on demand.”
He said the government claim made every year in parliament that the government has increased the budget is “even worse because you are rubbing salt on people’s wounds”. Dey called this practice “manipulation of figures”.
