MGNREGS: States fall behind in paying unemployment aid

• Only ₹90,000 released under MGNREGS as ‘unemployment allowance’ in FY 24

Highlights:

• This “unemployment allowance” is provided to workers in case of unmet work demand.
• The corresponding figure was ₹7.8 lakh in 2022-23.
• The ‘Economic Survey 2024’ tabled in the Parliament on July 22 pointed out that these figures are clearly deficient and do not reflect the correct picture in regard to unmet work demand.
• The survey noted that work was often unavailable for beneficiaries and that block-level functionaries may not register demand for work in real time.
• It also pointed out the flaw in the reporting system of MNGREGA underlining that work demanded is only reported on the portal when employment is actually provided. According to Section 7(1) of MGNREGA, 2005, “If a person applying for employment under the scheme is not employed within 15 days, he shall be entitled to a daily unemployment allowance.”
• The law states that this allowance shall be one-fourth of the wage rate for the first 30 days of the financial year and half of the wage rate for the remainder.
• Low disbursal of unemployment allowance is one of the chronic problems in implementation of the Act.
• In 2022-23 and 2023-24, only six States paid the allowance.
• In the two financial years before that - 2021-22 and 2020-21 - only three and four States, respectively, disbursed the allowance.
• In 2019-20, not a single State paid the money.
• One of the key reasons MGNREGA job cardholders are unable to receive the allowance is that they rarely are handed out the receipt registering their demand.
• This could be blamed on antipathy or inefficiency of the block-level administration.
• But often we find that the State governments are squeezed between the beneficiaries and chronic under-budgeting for the scheme by the Centre

Prelims Takeaway

• MGNREGA