Centre may revamp MGNREGS to address leakages, involve states as active stakeholders

The Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) is set to be revamped by the Centre in the coming months to address leakages and involve state governments as active stakeholders, sources told Business Today Television.

"We need an active role of states to make the scheme beneficial for its intended objective," a government official stated.

The Centre is concerned over how state governments are utilizing the scheme. It has been found that some states are using MGNREGS funds for state infrastructure projects rather than addressing unemployment, thus saving their own budgets.

As per sources, this misuse depletes the funds quickly, putting pressure on states needing to provide off-season employment. recent official data shows that the Centre has released Rs 89,098 crore in 2023-24, while total expenditure has reached Rs 1.5 lakh crore. In the Interim Budget 2024-25, the government revised the MGNREGA allocation for FY24 to Rs 86,000 crore, up from Rs 60,000 crore due to increased demand.

Earlier this year, the Union government introduced mandatory digital attendance through the National Mobile Monitoring System to ensure wages are paid via Aadhaar-linked bank accounts, aiming to curb leakages. 

"Fabrication of job cards was a severe issue we were facing," the official added.

The Centre now plans to take corrective measures to prevent misuse by wealthier states, particularly compared to low-income states.

Last fiscal year, the employment guarantee scheme generated 3 billion person-days of work, with Tamil Nadu leading in the share of households that received work under MGNREGA due to the high efficiency of its state machinery.

MGNREGS aims to provide at least 100 days of guaranteed wage employment annually to rural households whose adult members volunteer for unskilled manual work, primarily during off-seasons.