New Delhi: At Rs 86,000 crore, the Union government’s unchanged budgetary allocation to the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) is inadequate and part of its “systematic sabotage” of the scheme, an umbrella body of workers and activists has said.
In a statement issued on Sunday (February 2), the NREGA Sangharsh Morcha said that when inflation is accounted for, the scheme’s allocation in the 2025-26 budget is effectively lower by around Rs 4,000 crore compared to the 2024-25 budget.
While the allocation to the scheme in 2024-25 amounted to 0.26% of the GDP, the allocation in the budget presented on Saturday was equal to 0.24% of the GDP, its statement also said.
Under the MGNREG Act, rural households are guaranteed 100 days of employment a year at specially notified wages.
According to data current as of February 1, households under the scheme availed an average of a little less than 45 days of work this fiscal year, the Morcha said, adding that the figure for 2023-24 was around 52 days. This fiscal year will end on March 31.
The deficit for the scheme stands at Rs 9,860 crore and pending wages at Rs 6,949 crore as of February 1, it said, also writing that “an average of 20% of the [scheme’s] budget is used to clear past dues”.
“This inadequate budget will inevitably result in” delays in wage disbursement, worsening financial distress for rural workers; suppress demand for work under the scheme, in turn “denying people their right to employment”; and weaken rural infrastructure, the Morcha charged.
It also said the government’s “strategy of low initial allocation is a deliberate attempt to suppress MGNREGA work demand” and that when combined with the scheme’s “low wage rates”, participation is discouraged.
“This is not neglect; it is systematic sabotage of a critical lifeline for millions,” said the Morcha.
The parliamentary standing committee on rural development and panchayati raj in December said that inflation and the cost of living in both urban and rural areas had “risen manifold and is evident to all”.
“Even at this moment, going by the notified wage rates of MGNREGA, per day wage rate of around Rs 200 in many states defies any logic when the same state has much higher labour rates,” it added.
Wages for the MGNREGS are revised every year based on changes in the agricultural labour dimension of the consumer price index (CPI-AL).
Last February, the parliamentary standing committee on rural development and panchayati raj said that the practice of revising wages with 2010-11 CPI-AL values as the benchmark was “not coherent with the present inflation and cost of living”.
Citing the finds of an expert committee which recommended in 2019 that the need-based minimum wage in India be fixed at Rs 375 a day, the standing committee recommended that MGNREGA wages be ‘revised accordingly’.
As of the last revision in MGNREGA wage rates in March 2024, no administrative unit in India pays more than Rs 374 per day.
