Centre releases Rs.12,230cr for MGNREGS
The Central government released Rs.12,230 crore to the states for the rural jobs scheme under the MGNREGS. The Union rural development minister said the fund released will take care of the pending wage liability under MGNREGS for 2015-16. He added that it would also help run the program for 2016-17. This is one of the largest amounts released for the scheme at one time.
What is the scheme?
Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) is a rural development program which provides employment as a right, and it is backed by the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA).
Flagship NREGS launched
NREGS was launched from Anantapur district, Andhra Pradesh by the UPA government in 2006. It aimed at providing livelihood security by guaranteeing 100 days/year of unskilled manual work to every rural household. It had provisions of unemployment allowances in case the work is not provided within 15 days. Initially launched in 200 districts, it was extended to 130 more districts in 2007.
NREGS become MGNREGS
The National Rural Employment Guarantee Scheme was renamed as Mahatma Gandhi National Rural Employment Guarantee Scheme on the 50th anniversary of Panchayati Raj in India. "NREGA has been aptly named after the Father of the Nation as he had always held the concept of Gram Swaraj in high esteem" - former PM Manmohan Singh. However, some felt the decision had political motivations.
Initial success of MGNREGS
In the initial years, MGNREGS was a game changer as it significantly helped in reducing poverty and distress migration from rural to urban areas. It was also in some way responsible for the return of the UPA government in the 2009 general elections.
CAG points out discrepancies in MGNREGS
A report by the Comptroller and Auditor General (CAG) showed that between 2009-10 to 2011-12 only 20% of the funds allocated under MGNREGS had been released in states of Bihar, UP and Maharashtra. Incidentally, the scheme was most needed in these states as they accounted for 46% of India's poor. The CAG also reported rampant corruption and diversion of funds in the scheme.
MGNREGS increasing rural income?
Ashok Gulati, Chairman of the Commission for Agriculture Costs and Prices (CACP), showed that the real reason for growth in rural incomes was not MGNREGS but increase in farm wages.
New NDA government not keen on MGNREGS
Due to increasing criticism of the MGNREGS including delayed wage payment, poor asset quality, etc., the NDA government led by Narendra Modi was not too keen on continuing the MGNREGS. Addressing the Parliament, Prime Minister Modi called MGNREGS a "living monument" of the Congress's failure. The NDA government tried to restrict MGNREGS to 200 needy districts but later refrained.
Is the scheme a savior?
2 consecutive droughts, sliding commodity prices and weak rural demand led to a rethink on the importance of MGNREGS to revive the rural economy. In 2014-15, the agriculture GDP fell to a low of 1.1% posing serious threats to Indian economy's comeback. As a result, in 2015-16, the finance minister increased MGNREGS allocation to Rs.41,699 crore - highest ever and 26% higher than 2014-15.
Nation celebrates 10 years of MGNREGS
The Mahatma Gandhi National Rural Employment Guarantee Scheme commonly known as MGNREGS, launched by the UPA government, completed 10 years today. The government over the last 10 years has spent Rs.3.1 lakh crore on MGNREGS which has created 19.8 billion work days for people. Despite multiple criticisms, it had been instrumental in reviving the rural economy by creating jobs and increasing rural demand.