PM Modi favours rural jobs guarantee scheme recast to help poorest

Updated on Dec 04, 2022 08:15 AM IST

PM Modi had expressed concerns that the utilisation of the funds earmarked for the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) was skewed in favour of more affluent states instead of poorer states getting more money, two senior officials said, asking not to be named.

Prime Minister Narendra Modi.
Prime Minister Narendra Modi.
By, New Delhi

After Prime Minister Narendra Modi flagged key discrepancies in the jobs guarantee scheme at a recent review meeting on the rural sector, the central government has set up a panel to study its flagship welfare programme in its 16th year, officials said.

Modi had expressed concerns that the utilisation of the funds earmarked for the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) was skewed in favour of more affluent states instead of poorer states getting more money, two senior officials said, asking not to be named.

“The PM made a valid point that the programme is aimed at poverty alleviation, but the poorer states are not getting the required share of the MGNREGS funds,” one of the officials present at the meeting said.

Modi also pointed out anomalies in the amount of work in different states that need to be addressed, a second official said. “The Prime Minister also pointed out that in some states, a MGNREGA beneficiary has to work equivalent of digging a 2ft hole in the ground, whereas in some other states more labour would be required to complete a person day,” said the second official, who was also present at the meeting held in the second week of November.

Six states — Bihar, Chhattisgarh, Jharkhand, Madhya Pradesh, Odisha and Uttar Pradesh — have so far spent 17,814 crore out of 45,770 crore in wages for unskilled labour in the jobs scheme in the current financial year, according to rural development ministry data.

In other words, the six states that account for 64.5% of India’s poor population, according to the National Family Health Survey 2019-21, have utilised 38.9% of the MGNREGS funds so far this year.

Also, out of the 2,014 million person days the scheme has generated so far, 815 million, or 40.4%, was in these six states.

“This is certainly an issue to be resolved,” said the first official. “The Prime Minister was right to argue that the poverty alleviation scheme should focus on key areas.”

The wage bill of Uttar Pradesh was 5,157 crore on December 2, the highest among the states, followed by Tamil Nadu at 5,102 crore and Rajasthan’s 4,144 crore. The MGNREGS wage bill for Bihar was 4,030 crore, Chhattisgarh 1,061 crore, Jharkhand 1,325 crore, Madhya Pradesh 3,397 crore and Odisha 2,842 crore.

Former rural development secretary Jugal Kishore Mohapatra hailed the world’s largest job guarantee programme that provided some relief from the adverse economic effects of the Covid-19 pandemic in rural India. He maintained that the “better governed states usually secure a higher share of the MGNREGA fund as the scheme is demand-driven.”

“The better governed states have enough infrastructure and capacity to secure more funds from the MGNREGS, which is an open-ended, demand-driven scheme,” Mohapatra said. “Poorer states don’t have the capacity or infrastructure to demand more funds under the scheme. There are structural changes needed in the MGNREGS.”

The central government has set up a nine-member panel led by former rural development secretary Amarjeet Sinha to review the programme. The other members of the panel are professors Ashok Pankaj and Sonalde Desai, Sekhar Bonu of Niti Aayog, rural development ministry’s chief economic adviser Praveen Mahto and officials from the rural development and panchayati raj ministries, the Niti Aayog and the National Institute of Rural Development.

The issue of variation in the amount of daily work in a person day is an issue created at the state level, said the second official. “We are aware that in certain states, beneficiaries have to work less to earn their daily wage,” he said. “The rural development ministry has taken up the issue with the states.”

Mohapatra underlined that the MGNREGS law provides a broad guideline, but leaves a lot of power to the states to decide on the amount of work.

Other pressing issues include the quality of assets built under MGNREGS, the second official said. Mohapatra said that “the programme is focused on short-term employment with a marginal contribution to the long-term objectives.”

The quality of assets created under the scheme, and tuning the programme to set up infrastructure for farm and non-farm employment are also areas that should be looked into, an official of the rural development ministry said. “Livelihood creation, and providing additional income to farming families are the objective for the future,” he said.

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