BJP govt 'evades' rural distress, reduces MGNREGA allocation by Rs 9,500 crore

Counterview Desk
The Peoples’ Action for Employment Guarantee (PAEG), a civil rights group, has taken strong exception to the BJP Government cutting down on the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) allocation by Rs 9,500 crore, which it says has happened despite an unprecedented economic slowdown.
This is a “shortfall of at least 28% in the minimum allocation needed” says PAEG in a statement signed by Annie Raja, Jayati Ghosh, Nikhil Dey, Rajendran Narayanan and Rakshita Swamy.

Text:

The Peoples’ Action for Employment Guarantee is distressed to note the total lack of responsibility and sensitivity accorded by the Union Budget 2020-21 to the rural economy in general, and MGNREGA in particular. It is telling and obviously callous that the Budget estimate for this year at Rs 61,500 crore is Rs 9500 crore less than the revised estimate of 2018-19.
Rural distress has risen to alarming levels. As per the Periodic Labour Force Survey (PLFS) of 2017-18, rural unemployment has increased by 8 percent from 2011-12, and overall unemployment is the worst in 45 years. In conjunction with double-digit food inflation levels, this is a serious concern.
The situation is much worse for the landless depending on casual manual labour who constitute more than half the rural population. On ranking the rural population from the poorest to the richest, and dividing them into 10 groups, the Monthly Per Capita Consumption Expenditure (MPCE) has fallen for every group. What this means is that the entire cross section of rural India has become poorer.
In this context, all eyes were on the Union Budget 2020-21 to see how the Central Government would leverage its only legislative mechanism to provide employment and alleviate rural distress i.e. MGNREGA. And the result has been worse than expected, and deeply distressing.

A reduction in the budgetary allocation for MGNREGA in the year 2020-21 is an insult to the law the government has a duty to implement

The BJP government has reduced the budgetary allocation of MGNREGA by Rs 9,500 crore from its revised estimate of 2019-20. The revised estimate of MGNREGA in 2019-20 was Rs 71,000 crore, and the budget estimate of MGNREGA for 2020-21 as announced in the Union Budget today stood at Rs 61,500 crore. The reduction in the budgetary allocation is taking place when the minimum allocation needed to protect the MGNREGA as status quo is nearly Rs 85,927 crore. This in itself is a suppressed figure because:

It does not include the amount of pending liability that might be due at the end of this year for wages, material and administrative cost.
The figure is based on the approved labour budget of 2019-20, which is a suppression of the real labour demand on the ground.
It is based on severely suppressed MGNREGA wages which are below minimum wages in most of the states.

Calculation used to arrive at the minimum allocation of Rs 85,927 crore is as follows:

Considering Rs 268 as the cost of generation of one person day, by accounting for an increase of 8% from previous year’s cost of generation of one person day (Rs 248) due to wage indexation to price rise and inflation.
Considering 270 crore personday as the approved labour budget as of 2019-20.
Total financial allocation required to meet wage payments for approved LB would include 1 + 2, i.e. Rs 72,360 crore.
On average, 25% of the total expenditure has been for material costs (actually this could go upto 40%).. This translates to 0.25*72,360 = Rs 18,090 crore for material component. As per the Act, 75% of the material cost has to be borne by the Central government. Thus, the material cost to the central government is 0.75*18,090 = Rs 13,567 crore.
The total allocation required by the Central Government for wages + material = Rs 72,360 crore + Rs 13,567crore = Rs 85,927 crore.

Pending liabilities have been amounting to nearly one-sixth of each year’s allocation. The “approved labour budget” has been used by the central government to suppress demand. Wage rates of MGNREGA are lower than minimum wages in most states. If these basic factors are taken into account, the minimum allocation required to implement MGNREGA as per the law, enabling a demand based guarantee of 100 days work on demand , should be no less than Rs 1 lakh crore.
February 2 is MGNREGA day. A reduction in the budgetary allocation for MGNREGA in the year 2020-21 is an insult to the law the government has a duty to implement. It is also a clear indication of the BJP Government’s lack of priority towards the marginalised. No less can be expected from a Government led by a Prime Minister who in the Parliament vowed to keep MGNREGA alive only to prove it as a testament of failure.
This is a travesty for the rural poor, for whom the MGNREGA is a potential lifeline. PAEG resolves to continue fighting for a fair allocation to MGNREGA and advocate for its implementation across the country as mandated in the law.

Comments

Gujarat Information Commission issues warning against misinterpretation of RTI orders

By A Representative The Gujarat Information Commission (GIC) has issued a press note clarifying that its orders limiting the number of Right to Information (RTI) applications for certain individuals apply only to those specific applicants. The GIC has warned that it will take disciplinary action against any public officials who misinterpret these orders to deny information to other citizens. The press note, signed by GIC Secretary Jaideep Dwivedi, states that the Right to Information Act, 2005, is a powerful tool for promoting transparency and accountability in public administration. However, the commission has observed that some applicants are misusing the act by filing an excessive number of applications, which disproportionately consumes the time and resources of Public Information Officers (PIOs), First Appellate Authorities (FAAs), and the commission itself. This misuse can cause delays for genuine applicants seeking justice. In response to this issue, and in acc...

'MGNREGA crisis deepening': NSM demands fair wages and end to digital exclusions

By A Representative The NREGA Sangharsh Morcha (NSM), a coalition of independent unions of MGNREGA workers, has warned that the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) is facing a “severe crisis” due to persistent neglect and restrictive measures imposed by the Union Government.

A comrade in culture and controversy: Yao Wenyuan’s revolutionary legacy

By Harsh Thakor* This year marks two important anniversaries in Chinese revolutionary history—the 20th death anniversary of Yao Wenyuan, and the 50th anniversary of his seminal essay "On the Social Basis of the Lin Biao Anti-Party Clique". These milestones invite reflection on the man whose pen ignited the first sparks of the Great Proletarian Cultural Revolution and whose sharp ideological interventions left an indelible imprint on the political and cultural landscape of socialist China.

Gandhiji quoted as saying his anti-untouchability view has little space for inter-dining with "lower" castes

By A Representative A senior activist close to Narmada Bachao Andolan (NBA) leader Medha Patkar has defended top Booker prize winning novelist Arundhati Roy’s controversial utterance on Gandhiji that “his doctrine of nonviolence was based on an acceptance of the most brutal social hierarchy the world has ever known, the caste system.” Surprised at the police seeking video footage and transcript of Roy’s Mahatma Ayyankali memorial lecture at the Kerala University on July 17, Nandini K Oza in a recent blog quotes from available sources to “prove” that Gandhiji indeed believed in “removal of untouchability within the caste system.”

Targeted eviction of Bengali-speaking Muslims across Assam districts alleged

By A Representative A delegation led by prominent academic and civil rights leader Sandeep Pandey visited three districts in Assam—Goalpara, Dhubri, and Lakhimpur—between 2 and 4 September 2025 to meet families affected by recent demolitions and evictions. The delegation reported widespread displacement of Bengali-speaking Muslim communities, many of whom possess valid citizenship documents including Aadhaar, voter ID, ration cards, PAN cards, and NRC certification.

India's health workers have no legal right for their protection, regrets NGO network

Counterview Desk In a letter to Union labour and employment minister Santosh Gangwar, the civil rights group Occupational and Environmental Health Network of India (OEHNI), writing against the backdrop of strike by Bhabha hospital heath care workers, has insisted that they should be given “clear legal right for their protection”.

Uttarakhand tunnel disaster: 'Question mark' on rescue plan, appraisal, construction

By Bhim Singh Rawat* As many as 40 workers were trapped inside Barkot-Silkyara tunnel in Uttarkashi after a portion of the 4.5 km long, supposedly completed portion of the tunnel, collapsed early morning on Sunday, Nov 12, 2023. The incident has once again raised several questions over negligence in planning, appraisal and construction, absence of emergency rescue plan, violations of labour laws and environmental norms resulting in this avoidable accident.

Rally in Patna: Non-farmer bodies to highlight plight of agriculture in Eastern India ahead of march to Parliament

P Sainath By A Representative Ahead of the march to Parliament on November 29-30, 2018, organized by over 210 farmer and agricultural worker organisations of the country demanding a 21-day special session of Parliament to deliberate on remedial measures for safeguarding the interest of farm, farmers and agricultural workers, a mass rally been organized for November 23, Gandhi Sangrahalaya (Gandhi Museum), Gandhi Maidan, Patna. Say the organizers, the Eastern region merits special attention, because, while crisis of farmers and agricultural workers in Western, Southern and Northern India has received some attention in the media and central legislature, the plight of those in the Eastern region of the country (Bihar, Jharkhand, West Bengal, Orissa, Chhattisgarh and Eastern UP) has remained on the margins. To be addressed by P Sainath, founder of People’s Archive of Rural India (PARI), a statement issued ahead of the rally says, the Eastern India was the most prosperous regi...

Job opportunities decreasing, wages remain low: Delhi construction workers' plight

By Bharat Dogra* It was about 32 years back that a hut colony in posh Prashant Vihar area of Delhi was demolished. It was after a great struggle that the people evicted from here could get alternative plots that were not too far away from their earlier colony. Nirmana, an organization of construction workers, played an important role in helping the evicted people to get this alternative land. At that time it was a big relief to get this alternative land, even though the plots given to them were very small ones of 10X8 feet size. The people worked hard to construct new houses, often constructing two floors so that the family could be accommodated in the small plots. However a recent visit revealed that people are rather disheartened now by a number of adverse factors. They have not been given the proper allotment papers yet. There is still no sewer system here. They have to use public toilets constructed some distance away which can sometimes be quite messy. There is still no...

Counterview

Search This Blog