Ground report | Rampant corruption choking MGNREGA in Madhya Pradesh
Villagers accuse sarpanches of embezzling funds via fake beneficiaries, using threats to silence dissent; scheme meant to relieve rural distress grossly misused;
Kamlesh Tiwari, 41, works as a supervisor at a milk factory in Dewas, Madhya Pradesh. He and his wife, Neelu Tiwari, were listed as MGNREGA beneficiaries though they left their village — Bamhani in Sidhi district — 18 years ago. Sidhi is about 600 km northeast of Bhopal.
“I was shocked when I received money in my account last February," Kamlesh told The Federal. "In March, the sarpanch called me and asked me to transfer all the money to his personal account.”
On these lines, the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) Scheme, meant to relieve rural distress due to a paucity of jobs, has become an instrument of corruption in Madhya Pradesh.
Villagers have accused local sarpanches of embezzling funds, creating fake beneficiaries, and using threats to silence dissent. What was once a lifeline for rural employment is now a tool for exploitation and broken trust.
Fake beneficiaries
The Union government enacted MGNREGA in 2005 aiming to enhance livelihood security in rural areas. The Act guarantees at least 100 days of wage employment each year to one member of every rural household across the country.
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Neelam Dwivedi, another resident of Bamhani village, faced a situation similar to Kamlesh Tiwari. “I have never actually worked under MGNREGA, but the sarpanch added my name to the list of workers. Around ₹2,600–2,800 would be deposited into my account by the government, but the sarpanch would give me only ₹200 each month and take the rest,” she told The Federal.
Scams under MGNREGA extend beyond Bamhani village. Dhani village in Madhya Pradesh's Singrauli district — known as the Energy Capital of India thanks to its large coal reserves and power plants — has also come under scrutiny for alleged fraud.
Siphoning of funds
Dhani, located 117 km from district headquarters Singrauli city, has a population of around 1,400 people. Nearly 15 per cent of the residents belonging to tribal communities.
The village panchayat registered Kamala Pathak, a woman who passed away in 2020, as a labourer under the scheme. A job card was created in Kamala’s name, and the sarpanch was reportedly withdrawing money from her bank account.
When contacted, District Panchayat Chief Executive Officer of Singrauli, Gajendra Singh, told The Federal: “The matter will be investigated, and strict action will be taken against those found guilty.”
Decline in audit
The auditing process under MGNREGA in Madhya Pradesh has experienced a significant decline over the years.
In 2021-22, 98.35 per cent of gram panchayats (GPs) were audited at least once in a financial year, but this dropped dramatically to just 1.77 per cent in 2023-24.
Social audits, mandated under Section 17 of MGNREGA, are crucial for maintaining transparency and accountability by systematically comparing official records with ground realities.
These audits, conducted through gram sabhas, provide a platform for villagers, especially wage labourers, to scrutinise project details, voice grievances, and ensure that funds are used as intended.
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Duping farmers
In Bamhani village, four villagers accused the sarpanch, Akriti Tiwari, and her uncle, Arvind Tiwari, a BJP leader, of forging their documents and withdrawing money through illegal construction under the MGNREGA, on their land parcels.
Nageshwar Tiwari, a farmer from Bamhani village, said: “The sarpanch used my land for the Talab Yojna without my permission. He carried out construction using a JCB (equipment) under MGNREGA and withdrew money in my name. The land meant for farming is now ruined and useless. I filed a complaint at the Janpad Panchayat office in December, but no action has been taken so far.”
Ghanshyam Tiwari with his son Praveen: The duo were threatened by their village sarpanch for lodging a complaint against him.
Ghanshyam Tiwari, a disabled farmer, shared a similar experience: “The village secretary took my personal and land documents, saying they would apply for the Pradhan Mantri Awas Yojana (housing scheme PMAY) for me. Later, I found out they had used my documents to fraudulently claim benefits under the Talab Yojana on my land.”
“When I filed complaints, the sarpanch started threatening to kill me and my family," said a visibly distressed Ghanshyam.
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Recently, Ghanshyam's son, Praveen Tiwari, an army jawan posted in Jammu, received a chilling audio message on WhatsApp. The sarpanch and his aides threatened him, saying they would “run him over with a car and make it look like an accident” if the family did not withdraw their complaints.
Praveen immediately filed a police complaint and requested security for his family.
The Federal tried to contact Bamhani village Sarpanch Akriti Tiwari regarding these allegations, but she refused to comment. However, Anshuman Raj, Chief Executive Officer of the District Panchayat, Sidhi, said an investigation will be carried out, and strict action will be taken against those responsible.
Dipping performance
Madhya Pradesh's performance under MGNREGA has seen a significant decline over the past three years.
In 2021-22, 5.1 million households benefited from the scheme, but this number dropped to 4.5 million in 2022-23 and further declined to just 3.3 million by November 2023.
Additionally, the percentage of households completing 100 days of work has decreased from 3.96 per cent in 2021-22 to a mere 0.93 per cent by November 2023.
Ajay Singh, MLA and senior Congress leader from Sidhi (MP), said: “In villages, the sarpanch and other government officials rely on JCBs, machines, and dumpers to carry out work under MGNREGA. The use of machinery deprives people of employment, forcing many labourers to migrate to big cities in search of work.”
Flagging concerns
In November 2024, Rajya Sabha MP and former Madhya Pradesh Chief Minister Digvijaya Singh raised concerns over irregularities and corruption in MGNREGA in the state.
In a letter to Union Minister for Rural Development and Agriculture, Shivraj Singh Chouhan, he highlighted several instances of mismanagement and misuse of the programme. He urged the minister to take immediate action to address these widespread issues and ensure the proper implementation of the scheme.
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“When fake beneficiaries are created and funds are misused, genuine workers are left without jobs or wages,” Shivam Singh, an activist based in Sidhi, told The Federal. “This not only undermines the spirit of MGNREGA but also forces vulnerable families to migrate to cities in search of survival.”
Social activist Shashank Tiwari said: “The misuse of MGNREGA funds is not just a financial issue; it harms the livelihoods of millions. A full investigation is needed.”
“The government must take quick action, punish those responsible, and make sure the scheme delivers jobs for rural families," he added.