Govt may downsize MGNREGA to boost scheme impact on the poor

  • Chetan Chauhan, Hindustan Times, New Delhi
  • Updated: Oct 31, 2014 00:37 IST

For fiscal prudence and better outcome of public expenditure, the Narendra Modi government is likely to downsize some of the social sector schemes, including the rural job guarantee programme, the biggest grosser of the central funds.

Finance minister Arun Jaitley had allocated about Rs 33,351 crore for Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGA) in his budget this July but many believe that the huge expenditure was not resulting in the desired outcome because of its expansive spread.

The MGNREGA covers entire rural India spread over 6,600 blocks irrespective of whether there was demand for work or not. The government wants to change this and is looking at focusing on implementing the job guarantee scheme in about 2,500 blocks, where India’s poorest live.

“It is one of the proposals being discussed for the next Union budget as a measure to improve impact of public expenditure,” a senior government official told HT, adding that it would be discussed with the rural development ministry officials soon.

This was also an idea pushed by the Planning Commission when MGNREGA was conceived. The scheme was initially implemented in the 200 poorest districts in 2006 but within the next few years it was expanded to entire rural India.

The panel’s call to make it more outcome-oriented failed to cut ice with the UPA government even though the work provided to a household in a year reduced from about 70 days to 31.6 days in 2014-15. The law provided for maximum of 100 days of work for a household at a rate prescribed by the Centre, which was not met even in the
poorest of the districts.

Sources say PM Modi is keen to ensure that MGNREGA turns into a poverty alleviation scheme by creating assets that can improve agriculture productivity rather than only being a social security mechanism.

“Data has shown that the scheme is not of much use in the rich states of Punjab or Haryana. But, it can do wonders in poorer states such as Jharkhand or Odisha if its implementation is improved,” an official said. For that, the government wants to adopt more micro block-level approach instead of the present district-level implementation.

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