Centre to Scrap Caste-based Payments for MGNREGA

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• The Centre has decided to scrap the system of caste-based wage payments in the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) scheme after complaints from State Governments.

Changes proposed in the scheme

• Revised accounting procedure: Finance Ministry directed the Ministry of Rural Development to revert to the previous system of generating single muster, single Fund Transfer Order (FTO) and transferring money into a single National Electronic Fund Management System account.
  • Now a newly revised accounting procedure will be implemented for the expenditure to be captured under three Minor Heads for Scheduled Castes and Tribes and others, through a single FTO.
• Controversial caste-based wage system: Centre planned to revoke its controversial caste-based wage system after the State Governments warned of rising social tensions.

Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA)

• Mandate: The mandate of the MGNREGA is to provide at least 100 days of guaranteed wage employment in a financial year to every rural household whose adult members volunteer to do unskilled manual work.
• Objectives: Providing not less than one hundred days of unskilled manual work as guaranteed employment in a financial year to every household in rural areas as per demand, resulting in the creation of productive assets of prescribed quality and durability
  • Strengthening the livelihood resource base of the poor
  • Proactively ensuring social inclusion and
  • Strengthening Panchayati Raj Institutions
• Coverage: It is implemented in all rural districts of the country.
• Role of Gram Sabha in MGNREGS: It determines the order of priority of works in the meetings of the Gram Sabha keeping in view the potential of the local area, its needs, local resources.
  • Monitor the execution of works within the GP.
  • It is the primary forum for the conduct of social audits. It provides a platform to all residents to seek and obtain all relevant information from all the Implementing Agencies including GP in relation to MGNREGA works implemented in the GP area.
• Legal Right to Work: The Act provides a legal right to employment for adult members of rural households.

Issues/Challenges of MGNREGA

• Ridiculously low wage rate: Currently, MGNREGA wage rates of 17 states are less than the corresponding state minimum wages. Various judgements have upheld that the MGNREGA wage rate cannot be less than the minimum agricultural wage rate of the state.
• Insufficient budget allocation: MGNREGA’s success at the ground level is subject to proper and uninterrupted fund flow to the states. Thrice in the last year and once this year, funds have dried up in states due to lack of “mother sanctions” from the Central government which hampers the work in peak season.
• Regular payment delays: The Union Ministry of Rural Development considers wages paid once the FTO (Fund Transfer Order) is signed by the second signatory. However, delays take place even in the processing of signed FTOs, for which the Management Information System (MIS) does not calculate compensation.
• Workers penalised for administrative lapses: The ministry withholds wage payments for workers of states that do not meet administrative requirements within the stipulated time period.
• The banking puzzle: The rural banks are highly de-capacitated in terms of staff and infrastructure and thus always remain hugely crowded. The workers normally have to visit the banks more than once to withdraw their wages.
• Faulty MIS data: The increase in corruption and weakening accountability has roots in the excessive dependence of implementation of MGNREGA on technology (real-time MIS being one of them). There is a growing pile of evidence on how real-time MIS has made MGNREGA less transparent for workers, reduced accountability of frontline functionaries and aided in the centralisation of the programme.
• Non-payment of unemployment allowance: There are a huge number of unemployment allowances being shown in the MIS currently. But inaction from the Central government in ensuring payments of the same has shown that the government wants to use the MIS as per its convenience and is not honouring its own database.
• Genuine job cards being deleted to meet 100% DBT targets: Genuine job cards are being randomly deleted as there is a huge administrative pressure to meet 100 per cent Direct Benefit Transfer (DBT) implementation targets in MGNREGA.
• Discrimination: The most remarkable feature of MGNREGA is that it pays women the same as men, something that was virtually unimaginable in Rural India. However, cases of discrimination against women and people from backward groups are reported from several regions of the country.

Benefits of MGNREGA

• Social protection: It provides social protection for the most vulnerable people living in rural India by guaranteeing wage employment opportunities.
• Enhance livelihood security of the rural poor: Through the generation of wage employment opportunities in works leading to the creation of durable assets.
• Natural resource base: It will help rejuvenate the natural resource base of rural areas.
• Rural asset base: It will help create a durable and productive rural asset base.
• Empowerment of various sections of the society: Empowerment of the socially disadvantaged, especially, women, Scheduled Castes (SCs) and Scheduled Tribes (STs), through the processes of rights-based legislation.
• Decentralisation and participation: Strengthen decentralised, participatory planning through the convergence of various anti-poverty and livelihoods initiatives.
• Panchayati Raj Institutions: Deepen democracy at the grassroots by strengthening Panchayati Raj Institutions.

Way Forward/Suggestions

• Social audits: There is a need to carry out social audits as per rules and effective implementation of the delay compensation system.
• Compensation clause: Under the scheme’s compensation clause, agencies responsible for the delay are expected to pay 0.05 per cent of wages per day after the closure of the muster roll.
• Raising awareness: The participation of women and backwards classes must be increased by raising awareness and making it more inclusive.
• Utilisation of funds: Reasons for poor utilisation of funds should be analysed and steps must be taken to improve them. In addition, actions should be initiated against officers found guilty of misappropriating funds.
• National Level Monitors: The frequency of monitoring by National Level Monitors (NLMs) should be increased and appropriate measures should be taken by States based on their recommendations.

Source: TH