Why is the allocation for MNREGA less than the amount spent last year?

#News Bureau July 24,2024

The government has allocated Rs 86,000 crore for MNREGA this year. This is Rs 19,297 crore less than the actual expenditure of the scheme in the last financial year 2023-24 of Rs 1.05 lakh crore. However, only Rs 60 thousand crore was allocated in the last financial year. This year the allocation for MNREGA is just 1.78% of the total budgetary allocation, which is the lowest in ten years in funding the scheme. Due to the way the allocation of MNREGA has decreased in the last few years, many apprehensions are being raised about rural employment and consumption.

MNREGA guarantees 100 days of employment with minimum wages to every rural family. MNREGA is said to have been a revolutionary step for rural employment in India. Nobel Prize winner in economics Joseph Stiglitz said, ‘MGNREGA is India’s single greatest progressive programme and a lesson for the whole world.’ When the global economic crisis struck in 2008, it helped India recover from the economic recession.

Now, there have been allegations of the weakening of the same MNREGA. It is said that every year, the rural employment scheme faces the problem of low allocation of funds.

There are reports that in the name of eliminating corruption, this mechanism has been suppressed. Payments have been delayed. Workers move away from it to places where wages are paid immediately, even if it is less than the minimum wage. Last year, the West Bengal government had been alleging that one crore workers in the state have not been paid for a year. It was alleged that there has been massive corruption in MNREGA.

However, Finance Minister Nirmala Sitharaman has argued about the low allocation that MNREGA is a demand-based scheme and the government gives more money when required. But activists have argued that low allocation contributes to artificially suppressing the demand for work under the scheme.

Chakradhar Budhha, from LibTech India, an association of academics and activists, told The Hindu, “The allocation for FY 2024-25 is not only less than the expenditure in FY 2023-24, but also does not take into account the increased demand in the first quarter of this financial year. 5.74 crore more person days have been created in the first three months of the current financial year as compared to 2023-24. Also, the increase in wages for the current year is not included.”

In fact, Rs 41,500 crore has been spent under the scheme in the first four months of this financial year, while only Rs 44,500 crore is now left for the remaining eight months.

This attitude of the government comes at a time when the BJP has suffered significant losses in rural constituencies in the 2024 general election. According to an analysis by ‘The Hindu’, the BJP lost 53 Lok Sabha constituencies this year compared to 2019, which can be considered as rural seats. By the way, PM Modi had said in 2015 that MNREGA will continue as a living example of the failure of the Congress.