Is Union Budget 2021-22 MGNREGA allocation enough to alleviate rural distress

Number of person days to reduce to;2.7-2.8 billion person days for next year, says expert
Road construction under MGNREGA. Photo: Neha Sakhuja / CSE
Road construction under MGNREGA. Photo: Neha Sakhuja / CSE

The Union government’s budgetary allocation for the Mahatma Gandhi National Rural Employment Guarantee Act will reduce the number of person days in 2021-22 from what the job generation programme has achieved in the current year, experts said.

Union Finance Minister Nirmala Sitharaman’s Budget 2021-22 allocates Rs 73,000 crore for MGNREGA, 34.52 per cent below the Revised Estimate of Rs 111,500 crore for 2020-21. Budgetary Estimate for 2020-21 was Rs 61,500 crore; In 2019-20, Rs 71,686.70 crore was spent on the programme.

“The amount allocated for next year is Rs 38,500 crore less than the Revised Estimate for 2020-21. While the total number of person days generated so far has touched 3.4 billion, the government has provisioned for only about 2.7-2.8 billion person days for next year. This will limit the scope of employment and will result in indefinite delays in wage payments in the coming year,” Debamalya Nandy, Member, NREGA Sangharsh Morcha told Down To Earth (DTE).

Nandy said it was disappointing that the Government of India had ignored the current rural employment distress even though there was a need to maximise the spending in MGNREGA for enhancing rural demands.

“The pandemic has shown that there is heavy dependence on MGNREGA for employment in the country and the government needed to push the scheme by taking a number of measures,” Nandy said.

The massive underestimation in the budget allocation will only result in distress in vulnerable households, Nandy warned.

The budget’s proposed Rs 73,000 crore for MGNREGA was less, given the continuing high demand under the scheme at the height of the novel coronavirus disease (COVID-19) pandemic, Richard Mahapatra, managing editor of DTE, who has covered the subject extensively for several years, said.

“Last year, the government spent Rs 111,500 crore. This was due to the historic exodus of informal workers back to villages leading to a never-before-seen demand under the scheme. The budgetary allocation doesn’t impact the real expenditure the government has to make,” he added.

He said this was because it was a demand-driven scheme and government was legally guaranteeing to fulfil the 100 days of employment. So, if the demand and thus, expenditure overshot the budgeted amount, the government had to make a provision. Like last year, it will have to spend over Rs 40,000 crore more than the budgeted allocation.

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