Drying up of MGNREGA funds hits jobs; worker payments delayed

₹64,000 crore has already been spent on the scheme this year, requiring immediate additional funds

Payment of wages is credited directly to the bank/post office accounts of workers by DBT mechanism | Representative Photo: iStock

At a time when the states are banking on MGNREGA for the revival of rural employment, the flow of funds from the Centre to the scheme has dried up, leading to accumulation of pending wages.

The delay in clearance of fund transfer order by the Centre will curtail job allocations when the demand for employment under the scheme across the country has gone up by 38.79 per cent, pointed out an official of the West Bengal panchayats and rural development department.

In West Bengal, 13,92,305 households sought employment under the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), as on September 17. Out of them only 4,37,150 households were provided jobs.

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Whereas, in August, 20,72,662 households got employment out of 21,66,222 household applicants. In July, the performance of the state was even better, providing employment to 31,11,299 households out of 31,66,249 households that sought employment.

The recent sloth in job allocation is attributed to the non-release of funds by the Centre. The official said the state’s fund transfer order (FTO) amounting ₹397.57 crore is pending with the Centre, as on September 11.

At least nine states, including Andhra Pradesh, Madhya Pradesh, Uttar Pradesh and Jharkhand, and one Union Territory, Puducherry, whose FTOs amounting to ₹781.1 crore are awaiting clearance from the Centre, the official said quoting rural development ministry’s data.

Payment of wages is credited directly to the bank/post office accounts of MGNREGA workers by the Centre through direct benefit transfer (DBT) mechanism.

“Unless the additional promised amount of ₹40,000 crore is released immediately (by the Centre), delays in wage payments that have already begun will compound the woes of the marginalised,” pointed out civil society group People’s Action for Employment Guarantee (PAEG) in a press release.

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To boost rural employment in the wake of the pandemic, ₹40,000 crore was allocated by the Indian government in addition to the original allocation of ₹60,000 crore made in the Union Budget in February. As this financial year had begun with pending wage liabilities of around ₹16,000 crore, the PAEG pointed out, the actual allocation for the current fiscal was ₹84,000 crore.

Even before the half-way mark in this fiscal year, about ₹64,000 crore has already been spent, requiring immediate pumping of additional funds for the scheme.

A total of 22.49 crore people sought work under the scheme in the current financial year until September 12, 2020, compared to 16.2 crore during the corresponding period last year, a jump of 38.79 per cent, Rural Development Minister Narendra Singh Tomar told the Lok Sabha recently.

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