A better way to fix MGNREGS

The problems of the rural job scheme should be tackled through stricter monitoring, not by burden-sharing

BINAY SINHA he Mahatma Gandhi National Rural Employment Guarantee Scheme or MGN☐ REGS appears to be under scrutiny. It may even be overhauled, if recent media reports are to be believed. MGNREGS was launched by the United Progressive Alliance (UPA) government after the passage of a legislative Bill in 2005 to provide for at least 100 days of work at specified wage rates for each rural household in a year.

Despite many doubts and questions that MGNREGS was subjected to over the past several years, it appears to have stood the test of time, not least because it turned out to be a major instrument for helping rural workers during the Covid years. Indeed, as the accompanying chart shows, the use of MGNREGS funds has a direct correlation with the level of economic distress in the Indian economy.

Within a couple of years of its launch, economic growth in the country dipped to 3.1 per cent in 2008-09, thanks to the global financial crisis. It was a sharp decline from the 7.7 per cent growth in 2007-08.

Although gross domestic product (GDP) recovered in the following years, the impact on jobs was significant. Not surprisingly, job demand and the money spent under MGNREGS spurted.