The Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) has been a cornerstone of India’s rural employment strategy, providing millions with a financial safety net. However, the scheme is facing several challenges, including budget constraints, policy shifts, and implementation roadblocks. With the latest debates in Parliament and concerns raised by policymakers, it is crucial to examine the state of MGNREGS and explore necessary reforms to enhance its effectiveness.
In This Article:
The Importance of MGNREGS in Rural India
Introduced in 2005 under the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), this initiative aims to provide at least 100 days of wage employment to rural households. The scheme has been instrumental in reducing poverty, empowering rural women, and fostering economic stability. During crises like the COVID-19 pandemic, MGNREGS played a vital role in cushioning income losses for millions of migrant and daily wage workers.
Declining Budget Allocation: A Major Concern
One of the most pressing concerns surrounding MGNREGS is its declining budget allocation. In the Union Budget 2025, the allocation for MGNREGS remained stagnant at ₹86,000 crore. When adjusted for inflation, this represents a decline in real terms, effectively reducing the scope and reach of the program.
Additionally, nearly 20% of the allocated funds are expected to clear pending dues from previous years. This raises concerns about the availability of funds for new projects and wage disbursements, ultimately limiting employment opportunities for rural workers.
Technological Barriers to Implementation
While digital advancements aim to enhance transparency, they have also created significant hurdles for rural workers. The Aadhaar-Based Payment System (ABPS) and the National Mobile Monitoring System (NMMS) have made wage payments and attendance tracking more complex, often delaying payments and increasing bureaucratic red tape.
Many rural workers, particularly women and elderly laborers, face difficulties in adapting to these digital systems due to limited access to smartphones, unstable internet connectivity, and lack of technical know-how. These challenges call for an inclusive approach that balances technology with accessibility.
Key Reforms Needed for MGNREGS
To ensure the continued success and impact of MGNREGS, the following reforms are necessary:
- Increased Budget Allocation: The government should allocate adequate funds to accommodate inflation and rising demand for rural employment.
- Higher Wage Rates: Increasing the minimum daily wage under MGNREGS to ₹400 can enhance financial security for rural workers.
- Expansion of Workdays: Raising the number of guaranteed workdays from 100 to 150 days per year would provide better job stability.
- Timely Wage Disbursement: Simplifying payment mechanisms and reducing bureaucratic delays can improve the overall efficiency of the scheme.
- Bridging the Digital Divide: Implementing hybrid attendance and payment systems can address the challenges posed by digital-only platforms.
The Road Ahead for MGNREGS
The future of MGNREGS depends on strong policy support, adequate financial backing, and improved implementation mechanisms. The scheme has the potential to act as a catalyst for rural development by enhancing infrastructure, promoting sustainable agriculture, and empowering marginalized communities.
Policymakers must recognize that a well-funded and effectively managed MGNREGS is not just a welfare initiative but a tool for economic growth and social stability. The government must address the challenges it faces, ensuring that rural workers receive the benefits they rightfully deserve.
MGNREGS has played a crucial role in strengthening rural India by providing employment and financial security. However, systemic issues such as underfunding, wage delays, and technological barriers threaten its efficiency. By implementing necessary reforms, increasing financial support, and ensuring accessibility, the scheme can continue to uplift rural communities and contribute to India’s long-term economic development.
By – Jyothi
