Declining Workdays Under Mahatma Gandhi NREGA Scheme

The Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) has seen decline in its effectiveness in recent years. Reports indicate that the average workdays per household dropped to 44.62 days in 2024-25, a decrease from 52.08 days in the previous financial year. This decline is attributed to stagnant budget allocations and rising inflation, which have severely impacted rural livelihoods.

About MGNREGA

• MGNREGA was enacted to provide a legal guarantee for at least 100 days of unskilled wage employment in a financial year to every rural household.
• It aims to enhance livelihood security in rural areas.
• However, the recent data shows a worrying trend of reduced workdays and person-days.

Budget Allocation Issues

• The budget for MGNREGA has remained at ₹86,000 crore for two consecutive years.
• This stagnation has led to a deficit of ₹9,860 crore and pending wages amounting to ₹6,948.55 crore.
• The allocation, as a percentage of GDP, has declined to 0.24%. This indicates a lack of government prioritisation for rural employment schemes.

Impact on Rural Workers

The reduction in workdays and budget allocation has dire consequences for rural workers. It leads to massive delays in wage payments and increased financial distress. Many workers are left without the necessary employment, exacerbating poverty in rural areas.

Wage Stagnation

The average wage rate under MGNREGA saw only a 7% increase, while the Consumer Price Index (CPI) inflation was approximately 5%. This minimal adjustment does not keep pace with inflation, contributing to wage stagnation. Rural workers are struggling to maintain their livelihoods under these conditions.

Consequences for Rural Infrastructure

The decline in MGNREGA’s effectiveness also affects rural infrastructure. With less funding and fewer workdays, the quality of assets created through the programme diminishes. This has long-term implications for rural development.

Future Outlook

The future of MGNREGA appears uncertain. With the current budget constraints and ongoing inflation, the programme may struggle to fulfil its mandate. The need for increased funding and effective implementation is critical to restore its intended benefits.

Questions for UPSC:

1. Critically discuss the implications of stagnant budget allocations on rural employment schemes like MGNREGA.
2. Examine the relationship between inflation and wage stagnation in rural employment contexts.
3. Point out the challenges faced by rural infrastructure development due to reduced workdays under MGNREGA.
4. Analyse the role of political accountability in ensuring the effectiveness of employment guarantee schemes.

Answer Hints:

1. Critically discuss the implications of stagnant budget allocations on rural employment schemes like MGNREGA.

1. Stagnant budget allocations hinder the ability to provide guaranteed employment, leading to fewer workdays per household.
2. Reduced funding results in delays in wage payments, creating financial distress for rural workers.
3. Inadequate resources limit the quality and quantity of assets created under the program, affecting rural infrastructure.
4. The decline in budget as a percentage of GDP reflects a lack of governmental prioritization for rural employment.
5. Overall, stagnant allocations threaten the program’s effectiveness and the livelihoods of rural populations.

2. Examine the relationship between inflation and wage stagnation in rural employment contexts.

1. Wage increases under MGNREGA have not kept pace with inflation, exacerbating wage stagnation for rural workers.
2. With CPI inflation at approximately 5%, the 7% wage increase is insufficient to maintain purchasing power.
3. Stagnant wages lead to decreased living standards and increased poverty among rural households.
4. The mismatch between wage growth and inflation discourages participation in employment guarantee schemes.
5. This relationship illustrates the broader national crisis of wage stagnation affecting vulnerable populations.

3. Point out the challenges faced by rural infrastructure development due to reduced workdays under MGNREGA.

1. Fewer workdays result in less labor available for infrastructure projects, leading to incomplete or substandard work.
2. Reduced funding limits the scope of infrastructure projects, impacting long-term rural development plans.
3. Quality asset creation declines, as less time and resources are available to build sustainable infrastructure.
4. Inadequate infrastructure hampers economic growth and access to essential services in rural areas.
5. The overall decline in MGNREGA effectiveness threatens the future resilience of rural infrastructure systems.

4. Analyse the role of political accountability in ensuring the effectiveness of employment guarantee schemes.

1. Political accountability ensures that government officials prioritize rural employment schemes and allocate necessary resources.
2. Lack of accountability can lead to neglect of programs like MGNREGA, resulting in poor implementation and funding issues.
3. Active political engagement can raise awareness and mobilize support for rural employment initiatives.
4. Political leaders’ advocacy can influence budget allocations and policy adjustments to enhance scheme effectiveness.
5. Ultimately, accountability encourages transparency and trust, essential for the successful execution of employment guarantee schemes.