MNREGA:- Impact analysis.

 Introduction :- 

Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) is the largest social security scheme in the world that guarantees 100 days of unskilled manual work to all rural households in India. The MGNREGA actually gives rural households the right to work. It makes obligatory for the State to give them work on demand. Household could actually sue the states for not doing so. The work is usually on projects to build durable assets like roads, canals, ponds, wells etc.

MGNREGA creates livelihood opportunities for our fellow citizens and sets a minimum wage threshold for low income earners. It has changed the nature of the rural labour market. It gave opportunity to rural households to earn minimum income. While the poor have used it to climb out of poverty, the not-so-poor used it as a measure to supplement their income by working during lean agriculture periods. With higher participation of women and SC and ST individuals, the scheme is inclusive. About one in two jobs created under the scheme is for women and about 40 per cent for SC/ST. Today, payments under the scheme are mostly done by way of direct transfer into beneficiary accounts, which in turn forced people to open new bank or post office accounts.

Launched in 2006, the MGNREGA creates a justiciable “right to work”. It promises 100 days of wage employment in public works per year to all rural households whose adult members are willing to do unskilled manual work.

Objectives:-

• To provide guaranteed 100 days of wage employment per year to each rural household
• Creation of durable rural assets
• Social inclusion of women, SCs and STs
• Strengthen the Panchayati Raj Institutions

Impact of MNREGA :- 

MGNREGA is an employment guarantee scheme implemented in the rural areas. This scheme is in consonance with sustainable development which incorporates economic, social and environmental sustainability.

Economic sustainability:

• Provided 100 days of wage employment especially targeting the poorest of the poor. This has helped in achieving a minimum economic security.
• It has had a multiplier effect in the rural economic in accordance with the Keynesian theory of macroeconomics.
• Promoted financial inclusion among rural poor.
• It has resulted in food security.

Social sustainability:-

• Has successfully helped in improving the socio-economic position of women.
• Helped in reducing distress migration.
• Better networking among rural people resulting in the formation of SHGs.
• Improvement in health status.
• Reduction in school dropout rate

Environment sustainability:-
Projects like drought proofing, water conservation projects, de-siltation of lakes, plantation, and flood control helps in achieving environment sustainability.

Challenges :- 

• The scheme forces the Government to offer work, but so far does not measure productivity or durability of the work done. One of the complaints is about the slow pace of work.
• While there is incentive for workers to turn out as much as is needed to earn the wage rate, there is no incentive to expedite the process.
• Then, there are some administrative glitches. Panchayat Samitis don’t meet for months. It results in work sanctioning getting delayed.
• Only 10 per cent of 4.8 crore households managed to fully benefit with 100 days of work in 2015-16.
• Insufficient budgetary allocation and delay in release of funds from the Centre hampers the generation of enough work thus artificially squeezing demand.
• There is delay on part of the Centre to transfer funds to the states for payment of wages. This delay in payment of wages discourages people from taking up more work.
• Under the provision of the law on MGNREGA, if the government does not provide jobs within the stipulated 15 days, it has to pay unemployment allowance. Given that states face a cash crunch, they resort to nonregistration of work demand to avoid paying the unemployment allowances.
• Wages paid under MGNREGA is less than the private market wages in almost all states. Administrative expenses have also gone up from 5 % to 9 %, leaving little for wage payments.
• The government has selected 2549 blocks on the basis of them being most poor and backward and looks for more allocation to them which provides for doubling the allocation, while the rest of 4000 odd blocks have same support, this will cause huge differences in wage money procurements
• Though MGNREGS is supposed to be demand-driven, in reality the scheme is driven by officials at the top.

By: Shashank Shekhar