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NREGA / MGNREGA (Mahatma Gandhi National Rural Employment Guarantee Act)

The Mahatma Gandhi National Rural Employment Guarantee Act or MNREGA is an Indian job
guarantee scheme enacted by legislation on September 7, 2005. The Act provides a legal guarantee
for a minimum of one hundred days of employment every year to adults or the working members of
any rural household willing to work.

MGNREGA scheme ensures livelihood security in rural areas, which allows any adult member to do
unskilled work to earn a living. It is a step towards realising the right to work by targeting underprivileged
groups. To increase the employability of rural areas and bridge the gap between the upper and lower
class, the Government of India introduced the scheme in 1991. The step was initiated by then Prime
Minister P.V. Narasimha Rao to boost employment in the country with the significant goals of:

• Employment generation in the agriculture sector

• Infrastructure development in rural areas
• Enhanced food and income security
It was initially named as National Rural Employment Guarantee Act in 2005, which was later changed
to Mahatma Gandhi National Rural Employment Guarantee Act in 2009. The MGNREGA scheme has
constantly been updated to keep pace with the changing times and ensure that those enrolled in the
scheme get the maximum benefit.

Types of work under MNREGA /Work allocation under MGNREGA

India is administratively divided into States and Union Territories. Each state has districts, then within
districts, there are blocks, and within blocks have wards. This scheme gives employment related to
public work at the block level. The central govt releases the funds to the states. States then give the
funds to local bodies, i.e., gram panchayats. All the labourer’s accounts are registered with the gram
panchayats.

• Water conservation and water harvesting structures to augment and improve groundwater
• Renovation of traditional water bodies including desilting of irrigation tanks and other water
bodies
• Improving livelihoods through horticulture, sericulture, plantation, and farm forestry
• Providing all-weather rural road connectivity to unconnected villages and to connect
identified rural production centers to the existing pucca road network
• Maintenance and building of check dams. Check dams are the small dams created in small
reservoirs to check the flow of water
• Building farm ponds
• Water absorption trenches at foothills to reduce soil erosions
• Digging of soak pits
• Restoration of irrigation ponds
• Construction of Anganwadi, roads, etc.
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Features of MNREGA

The main features of the Mahatma Gandhi National Rural Employment Guarantee Act are:
• The act promised to provide hundred days of wage employment to any Adult from the
rural area who was willing to provide manual unskilled labour.
• This scheme acts to strengthen the Panchayati Raj by giving a significant amount of
control to the gram panchayat in managing and maintaining the various public projects.
They were given control over the decision-making process regarding the projects and were
allowed to reject proposals from higher levels.
• This scheme is way more transparent in its operations when compared to other
government schemes. This instils accountability into the operational guidelines.
• This act is applicable to all the districts which have registered under the scheme of the
Mahatma Gandhi National Rural Employment Guarantee Act or MGNREGA.
• Once applied for the scheme, every household would get a job card issued within 15
days of application of the scheme.
• The work area provided to the worker should be within 5 kilometres of the Jurisdiction of
the village.
• If the government fails to provide the people with work within 5 kilometres but work is
provided to them outside of the said area then they receive an additional 10 percent in the
wage as compensation.
• The wage provided to men and women was equal and there was no discrimination based
on gender while the wage was provided.
• To ensure that women were given equal employment opportunities third of the places
were reserved for women workers.
• If the government fails to provide work to the people, then the government has to provide
one-fourth of the wage for the first 30 days and half the wage for the remaining part of the
hundred days.
• The payment for the work done by the labourers should be provided within 15 days
through post office accounts or bank accounts.
• Proper working conditions were provided for the people to work like availability of drinking
water, a place to rest, and clean washrooms.
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Objectives of MNREGA

• Improve the purchasing power of the people residing in rural India

• One-third of the scheme is reserved for women to give women the opportunity to earn a living
• MNREGA yojna provides a legal guarantee wage to rural people
• The candidates are allowed to undertake any work based on their preference. However, the
order of each piece of work, site selection, and other related aspects are supervised by the
Gram Sabha (in an open assembly)
• The work site for MGNREGA employees has unique facilities such as a creche, drinking water,
and shade for workers to provide them with assistance when they are working
• MNREGA yojna targets activities like water conservation, afforestation, rural connectivity, flood
control, embankment repair, and many other activities.

Benefits of MGNREGA

1. Employment Generation: One of the MNREGA scheme's key benefits is creating employment
opportunities for rural households. It ensures that every rural household whose family members
volunteer to do unskilled manual work should get 100 days of guaranteed employment within a year.
NREGA will assist in reducing the poverty and unemployment in the rural areas.

2. Relief from Poverty: By providing employment opportunities, the MGNREGA scheme will assist
in reducing poverty in rural areas. It ensures that every household in rural areas must get a regular
income, directly improving their living standard and reducing the dependency on irregular income.

3. Infrastructure Development: The Mahatma Gandhi NREGA scheme contributes to rural

infrastructure development. MNREGA scheme supports the development of assets like roads, canals,
ponds and irrigation facilities. The NREGA scheme provides employment, increases connectivity and
agricultural productivity, and boosts overall development.

4. Women Empowerment: The MNREGA scheme also focuses on empowering women by

ensuring their participation in rural development. MGNREGA promotes gender equality by mandating
that at least one-third of the beneficiaries be women. MGNREGA aids in increasing the economic status
of women and their power to make decisions within the households.

5. Environmental Conservation: The Mahatma Gandhi NREGA scheme promotes sustainable

development by organizing activities related to environmental conservation. It focuses on projects like
soil erosion control, water conservation and afforestation. These initiatives will help save natural
resources, restore ecological balance, and reduce the effects of climate change.

6. Social Inclusion: The MGNREGA scheme focuses on providing equal access to marginalized
groups of society, including Scheduled Castes (SCs) and Scheduled Tribes (STs). It ensures that these
vulnerable groups have equal access to employment and are not discriminated against in any way.
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7. Asset Creation: MNREGA emphasizes the creation of durable community assets such as roads,
water conservation structures and irrigation facilities, which contribute to long-term development and
infrastructure improvements.

8. Transparency and Accountability: MNREGA incorporates social audit and grievance

redressal mechanisms to ensure transparency, accountability and effective utilization of funds.

9. Seasonal Employment Stabilization: MNREGA reduces the vulnerability of rural workers to

seasonal unemployment and provides a stable income throughout the year.

10. Others
✓ Women and older people are given a special allowance to work in their vicinity.
✓ Workers are entitled to basic facilities at the work-site like safe drinking water, a creche for
children, and medical facilities for major and minor injuries.
✓ MNREGA provides a safe, secure, and decent work environment
✓ It promotes infrastructural development in rural areas.
✓ The scheme focuses on women’s economic development, social empowerment, and
upliftment.
✓ If the wages are not paid within 15 days, then compensation for the same can be lodged by
the workers.
✓ Grievances redressal mechanism is also placed to ensure a responsive implementation
process.
✓ MGNREGA works with the sole motive of eliminating poverty from the country and narrowing
the ratio between rich and poor

Achievements of MGNREGA
• It is the world’s largest social welfare scheme and 3.14 lakh crore rupees were spent in
the first 10 years.
• The scheme has managed to reduce the poverty levels in India by a huge amount. It was,
hence, called a stellar example of rural development by the World Development Report
of 2014.
• It has helped many women in rural areas to make a livelihood as well as gain social
security.
• Since agriculture and its allied activities make up about 65% of the scheme, the sector
was benefitted.
• It provides basic facilities like clean drinking water and first aid to all the labour.
• It has helped in uplifting Scheduled Castes (SCs) and Scheduled Tribes (STs).
• According to the National Council of Applied Economic Research (NCAER), this scheme
has played a vital role in reducing poverty among the poor as well as the socially weaker
sections (Dalits, tribals and marginal farmers).
• Helped employ the people effected by Demonetization and GST (Goods and Services
Tax).
• Has rightly enforced the ‘Right to work’
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Challenges of MGNREGA:
Economical

• Low wage rate: MGNREGA wage rates are now lower than the matching state/UT
minimum wages in 34 of 35 states and union territories. The MGNREGA wage rate cannot
be less than the state’s minimum agricultural wage rate, according to several rulings.
Because workers aren’t interested in working for MGNREGA programmes due to the
absurdly low pay rates, contractors and intermediaries are now in control locally.
• Inadequate budgetary allocation: Researchers determined that the scheme
should have received an allocation of Rs 76,131 crore, which was less than the actual
amount, to satisfy the registered work requirement in 2017–18. Similar to practically every
year, the first six months see more than 80% of the funds depleted.
• Inflation: As agricultural labourers’ pay has multiplied, forcing farmers to seek higher
prices for their food grains through Minimum Support Prices, the MGNREGA initiative to
reduce poverty has come at the expense of skyrocketing food prices (MSPs).
• Affected labour market: Rural agricultural labourer wages are pushing farmers to
mechanise their operations, which is proving to be more cost-effective.
• Impact on urban sectors: MGNREGA also has implications for the increase of urban
wages in sectors like infrastructure and real estate, which depend on migrant workers from
rural areas. This increases the costs of real estate and infrastructure projects.

Administrative challenges

• Fabrication of job cards: The availability of fraudulent job cards, the use of fictitious
identities, missing data, and delays in entering information into employment cards are only
a few of the problems.
• Demand-supply mismatch in work allocation: Researchers have discovered a
growing disparity between the supply and demand for labour. According to a 2017–18
research of 3,500 panchayats, the employment that was offered was 32% less than the
need for labour that was created.
• Delay in payment of wages: The majority of states have not fulfilled the MGNREGA
requirement to pay wages within 15 days. Additionally, workers are not reimbursed for late
wage payments. Wage payments are frequently delayed for weeks or even months without
providing any sort of compensation.
• Non-payment of unemployment allowances: When the job is not readily
available, the majority of states do not provide unemployment benefits. The failure to
provide dated receipts for the requested work hinders employees from requesting
unemployment benefits.
• Workers penalised for administrative lapses: The ministry withholds wages
from employees of states that fail to comply with administrative obligations within the
allotted time frame (such as submitting the audited fund statements from the previous
financial year, utilisation certificates, bank reconciliation certificates, etc.).
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Social

• Behavioural implications: People who are employed under MGNREGA are

developing the habit of getting paid for doing nothing, which could have major
repercussions for India’s human prowess and outlook. This is because most of the labour
done under MGNREGA is not well planned and is frequently perfunctory.
• Impact on skilled occupations: Many specialised professions, such as handloom
weavers and rural craftsmen, are losing their workforce to MGNREGA, which causes a
loss of expertise in that field. Thus, even though employment guarantee programmes like
MGNREGA offer higher incomes and have little to no effect on skill development, they are
losing the distinctive abilities that have been accumulated through generations.