Editor's Pick: No money in MGNREGA coffers

The Centre’s flagship rural employment scheme has run out of funds halfway through the financial year. Supplementary budgetary allocations will not come to the rescue for at least a month when the next Parliamentary session begins. According to its own financial statement, the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) scheme shows a negative net balance of Rs. 8,686 crore. This means that payments for MGNREGA workers as well as material costs will be delayed, unless the States dip into their own funds. Activists say the Centre is condemning workers to “forced labour” by delaying wages at a time of economic distress. However, the Centre is now accusing many States of “artificially creating demand” for work on the ground. With demand for work under MGNREGA still high, activists had sought 50 more days of work under the scheme in June. The MGNREGA is a demand driven scheme, guaranteeing 100 days of unskilled work to any rural household that wants it. During last year’s COVID-19 lockdown, the scheme was ultimately given its highest budget of Rs. 1.11 lakh crore and provided a critical lifeline to a record 11 crore workers. However, the scheme’s 2021-22 budget was set at just Rs. 73,000 crore, with the Centre arguing that the nationwide lockdown was over, and that supplementary budgetary allocations would be available if the money ran out. As on October 29, the total expenditure, including payments due, had already reached Rs. 79,810 crore, pushing the scheme into the red. Already, 21 States show a negative net balance, with Andhra Pradesh, Tamil Nadu and West Bengal faring the worst. “We are facing a situation of MGNREGA closing down halfway through the year. Who is going to absorb the cost?,” said Nikhil Dey, a founder of the Mazdoor Kisan Shakti Sangathan. He cited a 2016 judgment of the Supreme Court, which described pending wage payments under MGNREGA as a “clear constitutional breach committed by the state.” A senior official of the Rural Development Ministry admitted that “it is somewhat early this year [to run out of funds],” and said “States can provide temporary funds out of their own kitty and then once the fund is available, it can be reimbursed [by the Centre].” The MGNREGA running out of funds is bad news for the rural poor, already vulnerable because of the pandemic, and that is why this story needs to be highlighted. The Hindu's Editorials Silly point: On linking cricket to patriotism Descent into chaos: On the Myanmar crisis Was this newsletter forwarded to you? Head over to our newsletter subscription page to sign up for Editor's Pick and more. Click here Try out The Hindu's daily news quiz Name the two new franchises to participate in IPL next year. a. Lucknow and Ahmedabad b. Kerala and Ahmedabad c. Goa and Kashmir d. Chandigarh and Orissa To find out the answer and play the full quiz, click here. [logo] Editor's Pick 30 OCTOBER 2021 [The Hindu logo] In the Editor's Pick newsletter, The Hindu explains why a story was important enough to be carried on the front page of today's edition of our newspaper. [Arrow]( [Open in browser]( [Mail icon]( [More newsletters]( No money in MGNREGA coffers [No money in MGNREGA coffers] The Centre’s flagship [rural employment scheme has run out of funds]( halfway through the financial year. Supplementary budgetary allocations will not come to the rescue for at least a month when the next Parliamentary session begins. According to its own financial statement, the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) scheme shows a negative net balance of Rs. 8,686 crore. This means that payments for MGNREGA workers as well as material costs will be delayed, unless the States dip into their own funds. Activists say the Centre is condemning workers to “forced labour” by delaying wages at a time of economic distress. However, the Centre is now accusing many States of “artificially creating demand” for work on the ground. With demand for work under MGNREGA still high, [activists had sought 50 more days of work]( under the scheme in June. The MGNREGA is a demand driven scheme, guaranteeing 100 days of unskilled work to any rural household that wants it.  During last year’s COVID-19 lockdown, the scheme was ultimately given its highest budget of Rs. 1.11 lakh crore and provided a critical lifeline to a record 11 crore workers. However, the scheme’s 2021-22 [budget was set at just Rs. 73,000 crore]( with the Centre arguing that the nationwide lockdown was over, and that supplementary budgetary allocations would be available if the money ran out. As on October 29, the total expenditure, including payments due, had already reached Rs. 79,810 crore, pushing the scheme into the red. Already, 21 States show a negative net balance, with Andhra Pradesh, Tamil Nadu and West Bengal faring the worst. “We are facing a situation of MGNREGA closing down halfway through the year. Who is going to absorb the cost?,” said Nikhil Dey, a founder of the Mazdoor Kisan Shakti Sangathan. He cited a 2016 judgment of the Supreme Court, which described pending wage payments under MGNREGA as a “clear constitutional breach committed by the state.” A senior official of the Rural Development Ministry admitted that “it is somewhat early this year [to run out of funds],” and said “States can provide temporary funds out of their own kitty and then once the fund is available, it can be reimbursed [by the Centre].” The MGNREGA running out of funds is bad news for the rural poor, already vulnerable because of the pandemic, and that is why this story needs to be highlighted.    The Hindu's Editorials [Arrow][Silly point: On linking cricket to patriotism]( [Arrow][Descent into chaos: On the Myanmar crisis]( [underlineimg] Was this newsletter forwarded to you? Head over to our newsletter subscription page to sign up for Editor's Pick and more. [Click here]( Try out The Hindu's daily news quiz Name the two new franchises to participate in IPL next year. a. Lucknow and Ahmedabad b. Kerala and Ahmedabad c. Goa and Kashmir d. Chandigarh and Orissa To find out the answer and play the full quiz, [click here](. Today's Best Reads [[In India, the steady subversion of equality] In India, the steady subversion of equality]( [[The hunter gets captured by the game | Aryan Khan, Sameer Wankhede and a political slugfest] The hunter gets captured by the game | Aryan Khan, Sameer Wankhede and a political slugfest]( [[Document containing NPR form pulled down from Census website] Document containing NPR form pulled down from Census website]( [[The Evergrande-sized question over Chinese politics] The Evergrande-sized question over Chinese politics]( Copyright @ 2021, THG PUBLISHING PVT LTD. If you are facing any trouble in viewing this newsletter, please [try here]( If you do not wish to receive such emails [go here](