Budget Briefs: FY 2022-23 MGNREGS allocation 9% lower, expenditure outstrips funds - Ria Kasliwal, Mridusmita Bordoloi, Avani Kapur

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published Published on Jan 31, 2023   modified Modified on Jan 31, 2023

Accountability Initiative, Centre for Policy Research

Budget 2023-24 will be unveiled on February 1. This brief examines the Government of India’s flagship rural employment programme. The Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS). It was launched in 2006 and is the largest scheme of the Department of Rural Development (DoRD) under the Ministry of Rural Development (MoRD). It aims to provide 100 days of guaranteed wage employment to every rural household.

At the start of Financial Year (FY) 2022-23, GoI allocated Rs. 73,000 crore as Budget Estimates (BEs) to MGNREGS, although MoRD had sought Rs. 78,000 crore from the Ministry of Finance. This was 6 percent less than the demand. In December 2022, to accommodate the increased demand for work an additional budget of Rs. 16,400 crore was allocated in the supplementary budget taking the total to Rs. 89,400 crore. But this amount was still 9 percent lower than the Revised Estimates (REs) for FY 2021-22.

Expenditure continued to be higher than the funds available and by the third quarter of FY 2022-23, 117 per cent of available funds had already been spent by states. Accumulated payments due, also known as pending liabilities, were Rs. 8,449 crore in FY 2022-23 till 31 December 2022.

Notified wage rates increased by 4 percent between FY 2021-22 and FY 2022-23, but actual wages remained lower than the notified wages for most states till 31 December 2022. Further, on an average, actual wages under MGNREGS were lower than wages for rural non-agricultural labourers.

There are also delays in wage payments to workers' accounts. A study of 11 states found that 70 per cent of the wage payments were credited after the mandated 15 days. Yet till 21 December 2022, of the 20 large states, 14 had not received more than 70 per cent of the delayed compensation that was approved for these states.

Please click here to read the brief

Ria Kasliwal, Mridusmita Bordoloi, Avani Kapur, Accountability Initiative, Centre for Policy Research, 30 January, 2023, https://accountabilityindia.in/wp-content/uploads/2023/01/Mahatma-Gandhi-National-Rural-Employment-Scheme_2023-24-Pre-Budget.pdf

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