The Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), enacted in 2006, aims to provide at least 100 days of unskilled wage employment to adult members of a rural household. It is intended to be a lifeline for the rural poor—nearly 147 million active workers—during times of economic distress and natural calamity. Despite the fact that the number of individuals looking for employment grew to 133 million in 2020-21, the government allotted 35% less funding for the programme in 2021-22 and is hesitant to give more than 100 days of work. Workers, on the other hand, said that they were still dealing with difficulties such as payment delays and insufficient job availability.
In this article, IndiaSpend and Khabar Lahariya report from the districts of Banda and Panna to learn how MGNREGS workers are coping with the negative economic effects of the lockdowns and jobs crisis, and why the government needs to allocate more funds to support the 95.9 million households actively seeking work through the rural jobs programme.
Increased labour demand, inadequate funding
Unemployment was an issue even before the first lockdown. According to IndiaSpend, in December 2019, around 48 percent of India’s workforce was self-employed, and by August 2020, this figure had risen to 64 percent, indicating diminishing job possibilities.
Sixteen million jobs were added in July 2021, but all of them were of “low quality,” according to a report released on August 5 by the Centre for Monitoring of Indian Economy, a research tank. Because of the monsoon planting season, over 70% of the jobs were in agriculture.
MGNREGS employees’ demand for employment grew by 43 percent in 2020-21, reaching 133 million individuals, compared to 2019-20, with 84 percent receiving some job. According to official data, the number of person-days of labour given climbed 1.5 times to 3.9 billion from the previous high of 2.7 billion in 2018-19. Nonetheless, all households got an average of 52 days of labour, as opposed to the promised 100. The administration notified parliament on August 10, 2021, that about 84 percent of person-days created between April and July 2020 (1.7-billion-person-days) were generated during the same period in 2021, demonstrating the ongoing need for labour.
According to the statistics, the demand for MGNREGS labour in Uttar Pradesh more than quadrupled in 2020-21, reaching 15.7 million people, compared to 2019-20; in addition to UP, Goa and Jharkhand witnessed a 100 percent or more rise. Except for Nagaland and Lakshadweep, all states and union territories reported a rise in demand, with nine reporting increases more than the national average of 43%. Madhya Pradesh recorded a 74 percent rise overall.
When comparing 2020-21 to 2019-20, the demand for work in Banda nearly doubled (95 percent), while in Panna it grew by 54 percent.
Before announcing a nationwide lockdown that resulted in a large flight of employees from cities to their homes in rural India, the Centre budgeted Rs 61,500 crore ($8.3 billion) for the scheme in 2020-21. It boosted the funding by 81% to Rs 111,500 crore ($15 billion) in 2020-21, but then cut it by 34% to Rs 73,000 crore in 2021-22.
According to the researchers, this allotment is insufficient to meet the increased demand and does not even cover 100 workdays for all employment card users. “We would require Rs 3 lakh crore [$40 billion] to offer 100 days of employment to every job card holding household,” said ReetikaKhera, economist and associate professor at the Indian Institute of Technology, Delhi. “No government has provided sufficient funds to do so since the MGNREGA was enacted.”
During droughts and natural disasters, MGNREGS allows for an additional 50 days of paid work. Given the magnitude of unemployment, MGNREGS activists asked that the government offer extra days of work and funding to meet the growing demand for labour.
According to an August 2021 report of the Lok Sabha standing committee on labour, the government should expand the number of days to “at least 200 days each year in order to adequately cater to the rising work demands.” According to the study, it must “consider” increasing budgetary allocations, making timely compensation for completed work, and making health insurance essential for all MGNREGS employees.
However, the Centre has been hesitant to expand the number of days of pay work. In July 2021, it informed parliament that “states[s] can offer additional man-days of labour above and beyond the 100-day limit from their own resources.” According to the government, an extra 50 days of pay employment are granted in designated drought-affected or natural catastrophe regions on the advice of the Ministry of Agriculture and Farmers Welfare, and there is “no intention to expand days of labour” under MGNREGS.
“During times of adversity, households are more likely to complete 100 days of labour sooner. This entitlement should be raised at least until the effects of Covid-19 have passed “said ICRIER’s Kapoor.
Insufficient salary increases and wage delays
Workers are hesitant to take on new jobs because of insufficient salary increases and wage delays. Workers endure many delays and obstacles in accessing pay, as we documented in December 2020 based on a three-state survey. According to an October 2020 investigation by scholars Ankita Aggarwal and Vipul Kumar Paikra, the MGNREGS salaries of at least 17 of the 21 states are lower than the state minimum wage for agriculture, with a deficit of 2-33 percent.
In light of the current economic recession, Kapoor believes that MGNREGS salaries should be increased and, at the at least, brought up to the states’ respective minimum wage for agriculture in order to stimulate consumption by low-income households.
(Source – Business Standard)