Union Budget: Despite Rise in Demand, MGNREGA Allocation Remains Unchanged

The Union government has allocated Rs 73,000 crore for MGNREGA, the rural jobs guarantee scheme, for the 2022-23 fiscal year, the same as the past fiscal. The revised estimate for the last fiscal was Rs 98,000 crore.

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Mumbai: Contrary to expectations that the government would combat the COVID-19 pandemic-induced mass unemployment, the Union Budget’s allocation for the Mahatma Gandhi National Rural Employment Guarantee Programme (MGNREGA) has remained stagnant.

The government has allocated Rs 73,000 crore for MGNREGA, the rural jobs guarantee scheme, in the upcoming fiscal. The budget estimate for the 2022-23 fiscal year is the same as the past fiscal. However, the revised estimate for the MGNREGA programme stands at Rs 98,000 crore, finance minister Nirmala Sitharaman announced in her Budget speech.

The ongoing coronavirus pandemic has widened inequality and pushed a large population towards abject poverty. The lack of employment opportunities has been exacerbated by the government’s failure to provide a safety net. And curtailing the budgetary allocation on a demand-driven scheme like MGNREGA has had a lasting impact on the lives of the rural poor.

There has been a steady decline in the budgetary allocation and eventual spending on providing rural employment in the country. MGNREGA, the government of India’s flagship programme introduced in 2006, aims at enhancing the livelihood security of households in rural areas of the country by providing at least 100 days of guaranteed wage employment. It had practically been a lifeline for the rural poor, more so during the national COVID-19 lockdown in March-June 2020.

Also Read: MGNREGA Was a ‘Lifesaver’ for Labourers During Lockdown: Gujarat Government

There has been a steady decline in the budget estimate and the eventual revised budget for the scheme. The budget estimate in 2021-22 was Rs 73,000 crore – 34% less than what was actually spent on the scheme in 2020-21. And this year’s budget estimate is around 25% lesser than the revised budget of the past year.

By the end of 2019, around 1.7 crore households had availed employment under the MGNREGA scheme. This number saw a dramatic jump by December 2020 – indicating that the rural poor were desperate and were struggling for survival. In 2020, around 2.7 crore households availed employment under the Act. The demand for work has only seen an upward move, with 2.4 crore people demanding work under MGNREGA.

Centre for Policy Research (CPR), one of India’s leading public policy think tanks, in its pre-budget analysis had pointed out several serious issues that are plaguing the rural employment scheme. It said the percentage of unmet demand, which is the difference between employment demanded and employment provided, was highest in April and September 2021 at 33% and 31%, respectively. “For FY 2021-22 till 31 December 2021, around 91 lakh households that demanded work had not yet received it,” a brief report by CPR notes.