Govt mulls extending rural job guarantee scheme to cities
The government plans to extend the rural job guarantee scheme (MGNREGA) to workers in cities left jobless by the Covid-19-induced lockdowns, Bloomberg has reported quoting a government official.
The government plans to extend the rural job guarantee scheme (MGNREGA) to workers in cities left jobless by the Covid-19-induced lockdowns, Bloomberg has reported quoting a government official.
“The government has been considering this idea since last year. The pandemic gave a push to this discussion,” said Sanjay Kumar, a joint secretary in the Ministry of Housing and Urban Affairs.
When approved, the programme may begin with smaller cities and initially cost about ₹350 billion ($4.8 billion), said Kumar.
Union Finance Minister Nirmala Sitharaman announced an allocation of ₹ 61,500 crore for the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) for the year 2020-21, down by more than 13% from the total estimated expenditure for 2019-20 which was at ₹71,001.81 crore.
The MGNREGA ensures workers in rural areas can earn a guaranteed minimum daily wage of ₹ 202 for at least 100 days a year. An urban version is supposed to soften the blow on citizens most affected by Covid-19 fallout, which has forced the deepest contraction in Asia’s third largest economy.
It involves employing people for local public works such as road-building, well-digging and reforestation. It covers more than 27 crore people and was used to provide employment to migrant workers returning from cities amid lockdown.
More than 12 crore people lost their jobs in April, pushing the unemployment rate to a record 23%, according to the Centre for Monitoring Indian Economy. But the rate has since fallen as the economy has reopened.
“A national level commitment to overcome the livelihood crisis is therefore essential for preventing urban workers from falling into poverty and for countervailing the sharp and sudden rise in inequality,” wrote Shania Bhalotia, Swati Dhingra and Fjolla Kondirolli, the authors of the report — ‘City of dreams no more: The impact of Covid-19 on urban workers in India’ — published by LSE’s Centre for Economic Performance.
The program would give a demand boost for the economy, said Ashima Goyal, a professor at the Indira Gandhi Institute of Development Research in Mumbai, and an adviser to Prime Minister Modi.
