Going off-course: On the rural jobs scheme and the Centre’s bid to change its funding

Source: The post is based on the article “Going off-course: On the rural jobs scheme and the Centre’s bid to change its funding” published in The Hindu on 18th February 2023.

Syllabus: GS 2 – Welfare schemes for vulnerable sections of the population by the Centre and States and the performance of these schemes.

Relevance: About the performance of MGNREGS.

News: The government has slashed the budget for the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS).

What is Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS)?

What is the rationale behind the reduction in funds for MGNREGA?

What are the positive impacts of MGNREGS?

17 years since the implementation of the MGNREGS studies have asserted its net positive impact in rural areas. These include, a) reducing poverty through providing off-season employment, b) improving household consumption among the invariably poor citizens who avail the scheme, c) acting as insurance during monsoon deficient seasons, and d) allowing greater food security through increased productivity by the works generated.

During the pandemic, the scheme acted as a lifeline for migrant workers from urban areas. Overall, the Scheme functioned as a robust welfare tool.

What are the challenges associated with the performance of MGNREGS?

-The scheme has still not reached the level of creating more useful assets beyond roads and irrigation canals. The scheme requires more inclusiveness and better implementation.

-There are also wage delays and underfunding in many areas.

-Aadhaar-based payments have neither reduced corruption nor reduced wage payment delays. Instead, they create hurdles for officials and workers during the implementation.

-The Union Rural Development Minister also suggested amending the Act to change the contribution of funds from 100% by the government to a 60-40 split between the Centre and the States in order to make States “more vigilant regarding corruption”. But this will only lead to further complications in funding as States’ share of taxes is diminishing following GST and the financial stresses.

What are the challenges associated with the inadequate allocation of funds and the demand for MGNREGS?

What should be done to improve the performance of MGNREGS?

MGNREGS is salient, especially in poorer States. Hence, the Centre must ensure its robust funding instead of putting the onus on individual States. The government must change its approach towards the MGNREGS by recognising its potential in catering to the poor’s right to work.