UPSC Mains 2019: Critical analyses of MGNREGA

Mahatma Gandhi National Rural Employment Guarantee Act


Topic: Critical analyses of MGNREGA

Topic in Syllabus: GS Paper 2 – Indian Governance


Mahatma Gandhi National Rural Employment Guarantee Act



The Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), also known as Mahatma Gandhi National Rural Employment Guarantee Scheme (MNREGS) is Indian legislation enacted on August 25, 2005. The MGNREGA provides a legal guarantee for one hundred days of employment in every financial year to adult members of any rural household willing to do public work-related unskilled manual work at the statutory minimum wage. The Ministry of Rural Development (MRD), Govt of India is monitoring the entire implementation of this scheme in association with state governments.



  • The Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) was introduced with an aim of improving the purchasing power of the rural people, primarily semi or un-skilled work to people living below poverty line in rural India. It attempts to bridge the gap between the rich and poor in the country. Roughly one-third of the stipulated work force must be women.
  • The objective of the Act is to enhance livelihood security in rural areas by providing at least 100 days of guaranteed wage employment in a financial year to every household whose adult members volunteer to do unskilled manual work.
  • Adult members of rural households submit their name, age and address with photo to the Gram Panchayat. The Gram Panchayat registers households after making enquiry and issues a job card. The job card contains the details of adult member enrolled and his /her photo. Registered person can submit an application for work in writing (for at least fourteen days of continuous work) either to Panchayat or to Programme Officer.
  • The Panchayat/Programme officer will accept the valid application and issue dated receipt of application, letter providing work will be sent to the applicant and also displayed at Panchayat office. The employment will be provided within a radius of 5 km: if it is above 5 km extra wage will be paid.



  • Strong social safety net for the vulnerable groups by providing a fallback employment source, when other employment alternatives are scarce or inadequate.
  • Growth engine for sustainable development of an agricultural economy. Through the process of providing employment on works that address causes of chronic poverty such as drought, deforestation and soil erosion, the Act seeks to strengthen the natural resource base of rural livelihood and create durable assets in rural areas. Effectively implemented, MGNREGA has the potential to transform the geography of poverty
  • Empowerment of rural poor through the processes of a rights-based Law
  • New ways of doing business, as a model of governance reform anchored on the principles of transparency and grass root democracy Thus, MGNREGA fosters conditions for inclusive growth ranging from basic wage security and recharging rural economy to a transformative empowerment process of democracy.


Key facts about MNREGA:

  • MGNREGA guarantees hundred days of wage employment in a financial year, to a rural household whose adult members volunteer to do unskilled manual work.
  • Individual beneficiary oriented works can be taken up on the cards of Scheduled Castes and Scheduled Tribes, small or marginal farmers or beneficiaries of land reforms or beneficiaries under the Indira Awaas Yojana of the Government of India.
  • Within 15 days of submitting the application or from the day work is demanded, wage employment will be provided to the applicant.
  • Right to get unemployment allowance in case employment is not provided within fifteen days of submitting the application or from the date when work is sought.
  • Receipt of wages within fifteen days of work done.
  • Variety of permissible works which can be taken up by the Gram Panchayaths.
  • MGNREGA focuses on the economic and social empowerment of women.
  • MGNREGA provides “Green” and “Decent” work.
  • Social Audit of MGNREGA works is mandatory, which lends to accountability and transparency.
  • MGNREGA works address the climate change vulnerability and protect the farmers from such risks and conserve natural resources.
  • The Gram Sabha is the principal forum for wage seekers to raise their voices and make demands. It is the Gram Sabha and the Gram Panchayat which approves the shelf of works under MGNREGA and fix their priority


Implementation Status of MGNREGA:

  • The scheme was introduced in 200 districts during financial year 2006-07 and 130 districts during the financial year 2007-08
  • In April 2008 NREGA expanded to entire rural area of the country covering 34 States and Union Territories, 614 Districts, 6,096 Blocks and 2.65 lakhs Gram Panchayat.
  • The scheme now covers 648 Districts, 6,849 Blocks and 2,50,441 Gram Panchayats in the financial year 2015-16.


Achievements of MGNREGA:

  • During Financial Year (FY) 2015-16, 235 crore Persondays were generated which was the highest compared to the previous five years. During FY 2016-17 so far, 4.8 crore households were provided employment in 142.64 lakh works.
  • In the process 200 crore person-days of employment were generated. Out of the total employment, 56% have been generated for women. This is the highest ever participation of women since inception of the programme.
  • Total expenditure in the programme since its inception is Rs. 3,76,546 crore and 48,000 crore is the allocation of fund for FY 2017-18, which is the highest ever allocation for MGNREGA.
  • On an average, 25 to 30 lakh works were completed every year (till FY 2013-14). On the contrary, 51.3 lakh works have been completed so far in current FY 2016-17.
  • For the first time since inception of the programme, Consolidated Guidelines for Water Conservation were drafted. Mission Water Conservation – Planning and monitoring Framework for Natural Resource Management (NRM) related works under MGNREGA in convergence with Pradhan Mantri Krishi Sinchayee Yojana (PMKSY) and Integrated Watershed Management Programme (IWMP) has been prepared for scientific planning and execution of water management works with the use of latest technology is the focus area of the Ministry.
  • In FY 2016-17 (so far) 63% of total expenditure is on NRM (Natural Resource Management) works. Expenditure on agriculture and allied sector works in FY 2016-17 is nearly 70%, which was only around 48 % in FY 2013-14.
  • GeoMGNREGA is a path breaking initiative that uses space technology for geo-tagging all assets created under MGNREGA for improved planning, effective monitoring, enhanced visibility and greater transparency. The initiative was implemented in FY 2016-17, and so far, nearly 65 Lakh assets have been geotagged and made available in the public domain.


Funding pattern of MGNREGA:

Funding is shared between the centre and the states.  There are three major items of expenditure – wages (for unskilled, semi-skilled and skilled labour), material and administrative costs.  The central government bears 100% of the cost of unskilled labour, 75% of the cost of semi-skilled and skilled labour, 75% of the cost of materials and 6% of the administrative costs.


The Main Government holds the expenses on the following items:

  • The entire price of income of inexperienced guide workers
  • 75% of the price of content, income of experienced and partial experienced workers
  • Administrative expenses as may be identified by the Main Government, which will consist of inter alias, the wage and the considerations of the Program Official and his assisting team, place of work facilities
  • Expenses of the Nationwide Career Assurance Council The Condition Government holds the expenses on the following items: 25% of the price of content, income of experienced and partial experienced workers
  • Unemployment allocation due in case the Condition Government cannot provide wage occupation on time.
  • Administrative expenses of the Condition Career Assurance Authorities.
  • Popular scheme of MGNREGA started with a preliminary expenditure of $2.5bn (Rs 11300cr) in year 2006–07.


Funding the implementation of MGNREGA:

The central Government bears the cost on the following:

  • The entire cost of wages of unskilled manual workers
  • 75% of the cost of material, wages of skilled and semi-skilled workers
  • Administrated expanses as may be determined by the central government, which will include, inter alia, the salary and allowance of the programme officer and his supporting staff and work site faculties.
  • Expanses of the central employment Guarantee council

The state government bears the cost on followings:

  • 25% of the cost of material, wages of skilled and semi-skilled workers
  • Unemployment allowances payable in case the state government cannot provide wage employment on time.
  • Administrative expenses of the state employment guarantee council.


Key issues associated with MGNREGA:

Issues Relevant to Job Cards:

  • While as many as 12.5 crore households have been issued job cards out of an estimated 13.8 crore rural households ( as per the 2001 census), there are several issues related to existence of fake job cards, inclusion of fictitious names, missing entries and delays in making entries in job cards.
  • To make sure that non-urban families likely to seek inexperienced manual labor are determined & confirm against reasonably reliable local database so that non-domiciled contractor’s workers are not used on NREGA performs.
  • Job cards confirmation is done on the spot against a current database and reducing enough time lags between program and issue of job cards to remove the possibility of rent seeking, and creating greater visibility etc.
  • Besides guaranteeing that Job Cards are released prior to career need and perform allowance rather than being released on perform sites which could subvert the is designed of NREGA.

Delay in payment of wages:

  • Most states have failed to disburse wages within 15 days as mandated by MGNREGA. In addition, workers are not compensated for a delay in payment of wages.

Nonpayment of unemployment allowances:

  • Most states do not pay an unemployment allowance when work is not given on demand. The non-issuance of dated receipts of demanded work prevents workers from claiming an unemployment allowance.

Large number of incomplete works:

  • There has been a delay in the completion of works under MGNREGA and inspection of projects has been irregular. Implementing agencies were able to complete only 98 lakh works out of 296 lakh works.

Lack of implementation:

  • Implementation of the scheme has not been as smooth and flawless as was expected despite clear guidelines provided by the Union Ministry of Rural Development. Complaints began pouring in at the State Department of Rural Development. Complaints as such, would not be taken as anything very serious and damaging provided competent authorities took prompt steps to address them and set thing right. Unfortunately that did not happen. Was it out of lack of a sense of responsibility and unhealthy work culture or was it because of vested interests at certain levels, remains to be probed.


  • Provision of sufficient quality of perform place features for women and men labors Development and upkeep of durable resources sufficient review and assessment systems extensive organization of social review and use of conclusions.



The Standing Committee on Rural Development made the following recommendations, based on its findings:

  • Regulation of job cards: Offences such as not recording employment related information in job cards and unlawful possession of job cards with elected PRI representatives and MGNREGA functionaries should be made punishable under the Act.
  • Participation of women: Since the income of female workers typically raises the standard of living of their households to a greater extent than their male counterparts, the participation of women must be increased through raising awareness about MGNREGA.
  • Participation of people with disabilities: Special works (projects) must be identified for people with disabilities and special job cards must be issued and personnel must be employed to ensure their participation.
  • Utilization of funds: The Committee found that a large amount of funds allocated for MGNREGA have remained unutilised.  For example, in 2010-11, 27.31% of the funds remained unutilised.  The Committee recommends that the Department of Rural Development should analyse reasons for poor utilisation of funds and take steps to improve the same.  In addition, it should initiate action against officers found guilty of misappropriating funds under MGNREGA.
  • Context specific projects and convergence: Since states are at various stages of socio-economic development, they have varied requirements for development. Therefore, state governments should be allowed to undertake works that are pertinent to their context.  There should be more emphasis on skilled and semi-skilled work under MGNREGA.  In addition, the Committee recommends a greater emphasis on convergence with other schemes such as the National Rural Livelihoods Mission, National Rural Health Mission, etc.
  • Payment of unemployment allowance: Dated receipts for demanded work should be issued so that workers can claim unemployment allowance. Funds for unemployment allowance should be met by the central government.
  • Regular monitoring: National Level Monitors (NLMs) are deployed by the Ministry of Rural Development for regular and special monitoring of MGNREGA and to enquire into complaints regarding mis-utilisation of funds, etc. The Committee recommends that the frequency of monitoring by NLMs should increase and appropriate measures should be taken by states based on their recommendations.  Additionally, social audits must mandatorily be held every six months.  The Committee observes that the performance of MGNREGA is better in states with effective social audit mechanisms.
  • Training of functionaries: Training and capacity building of elected representatives and other functionaries of PRIs must be done regularly as it will facilitate their involvement in the implementation of MGNREGA.


Sample Question:

Critically analyses the Mahatma Gandhi National Rural Employment Guarantee Scheme (MNREGS), how far this scheme achieved its targets?