MGNREGA cushion for rural unemployment

The Central Government's flagship scheme for rural employment - Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA), acted like a shock absorber during migrant and livelihood crisis triggered by national as well as state lockdowns and travel restrictions during COVID-19 pandemic. Persisting gap between rising demand for rural employment under MNERGA and allocation in the Union budget reflects worries of industries employing unskilled labour of facing shortage of migrant workers if implementation of the Act leads to strengthening the rural livelihood opportunities and checking outmigration. The core objective of the act is to provide minimum 100 days of unskilled manual work as a guaranteed employment to rural every household according to demand for creation for productive quality assets. The Parliamentary Standing Committee on Rural Development and Panchayati Raj in its recent critical evaluation of MNREGA implementation has highlighted several shortcomings related to availability of fund, disparity in wages among various states, monitoring and evaluation. The committee has harped on the need for pragmatic budget allocation to ensure that there is no shortage of fund during mid-year for timely payment of wages and purchase of materials. The evaluation brought to light that budget estimates needed to be revised and substantially increased to cater to rising demand for work over the past 4-5 years. The committee found that in 2018-19, the budget estimate was increased from Rs. 55000 crores to Rs. 61830 crores, from 60,000 crores to Rs. 71001 crores in 2019-20, from Rs. 61500 crores to Rs. 111500 crores in 2020-21. The substantial hike in revised estimate, almost double the budget estimate during 2020-21 explained how the MNREGS provided the cushion for reverse migration of labour who returned to their villages during the first wave following national lockdown resulting in loss of livelihood, food, and shelter. The parliamentary panel was perplexed by the rationale behind the Central government keeping the allocated budget estimate for 2021-22 at Rs 73000 crores despite the surge in demand in the previous year and Rs 52228 crores already spent in six months. This is also indicative of the slow pace of economic revival in post pandemic period and MNREGS continuing to be the only resort for a large rural unskilled workforce. The Committee recommended to the Department of Rural Development to review its budgetary demand pertaining MGNREGA and ensure that 'agreed to labour budget' is made at concerned level keeping in view the expenditure of previous years. Decline in accrual of unspent balance from Rs 5270 crores in 2020-21 to Rs 1351 crores as on November 5, 2021, demonstrated improvement in payment of wages and other administrative performances. The evaluation, however, revealed huge pendency of wage liabilities to the tune of Rs 2763 crores, which the committee says, point towards inordinate delay in payment of wages to MNREGA beneficiaries. "There maybe plethora of reasons causing delay in the payment of wages, but none of the reasons can be sufficient enough to justify this blatant non-adherence to the statutory provision of the Act," states the report. Wage disparity and low wages under MNREGA in most states have been identified to be primary push factors behind largescale migration of rural masses for better pastures. The Committee notes that the wage rate range from as low as Rs. 193 per day in Chhattisgarh and Madhya Pradesh and Rs. 198 per day in Bihar and Jharkhand to Rs. 318 per day in three village Panchayats of Sikkim and Rs. 315 per day in Haryana. The daily wage in rest all states is between Rs 200 to Rs 300 but in most states, it is less than Rs 250. The committee's recommendation for ending disparity of wages among States and devising a mechanism for notifying a unified wage rate across the entire country is worth consideration by the Central Government, given the importance of MNREGA in creating large scale rural employment when the country is struggling to cope with post pandemic employment crisis triggered by the economic downturn. Official data show that barely 10 per cent of households who are provided livelihood under MNREGA are provided the 100-days employment and low wage is seen to be a deterrent factor by the committee behind low demand for the demand-driven central scheme. Upward revision of the wages can be expected to raise demand for 100 days employment but will require adequate budget allocations. In Assam, upward revision comes with a challenge of matching the wage payment of over a million tea garden workers. Tea industry says increase in daily wages to Rs 351 as demanded by workers' bodies and promised by political parties will render tea cultivation unviable. If daily MNERGA wage is increased to Rs 350 there could be withdrawal of a large number of seasonal and casual workers engaged in plucking in gardens which cannot be overlooked by the government.