Reviving MGNREGA For Effective Rural Employment

• 12 Dec 2025

For Prelims: Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS), Aadhaar Payment Bridge System (APBS), Gram Panchayats, Forest Rights Act (FRA), 2006, JanMGNREGA App, Blockchain

For Mains: Key provisions regarding Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS), associated challenges and way forward to strengthen it.  

Source: BS 

Why in News?

The Central government has agreed to resume Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) works in West Bengal, subject to stringent conditions to ensure transparency and prevent corruption.  

• In March 2022, the Centre invoked Section 27 of the MGNREGA Act, 2005 to withhold funds due to corruption, mismanagement, and bogus beneficiaries in West Bengal.

Summary 

• MGNREGA work resumed in West Bengal after a three-year suspension, with strict central oversight to address corruption. 
• The scheme still struggles nationally with wage delays, poor asset quality, weak social audits, and digital exclusion. 
• To function effectively, MGNREGA requires timely funding, genuine decentralization to Panchayats, strict accountability, and inclusive technology.

What is Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS)? 

• About: It is a Centrally Sponsored Scheme designed to provide guaranteed rural employment as a form of social security in India.  
  • It was launched in 2005 and is implemented under the Ministry of Rural Development, which serves as the nodal ministry. 
• Statutory Employment Guarantee: It guarantees 100 days of wage employment per rural household, with 50 additional days in drought- or disaster-affected areas.  
  • If work is not provided within 15 days of application, households receive unemployment benefits—25% of the minimum wage for the first 30 days and 50% thereafter. 
• Administrative Framework: At least 50% of scheme works must be executed by Gram Panchayats. DMs serve as District Programme Coordinators, ensuring comprehensive implementation. 
  • The Centre funds 100% of unskilled wages and 75% of material costs, while States cover the remaining 25%. 
• Central Oversight: Section 27 of the MGNREGA Act, 2005 grants the Central Government the authority to ensure the Act is implemented properly. 
  • Under it, upon receiving a credible complaint of fund misuse, the Central Government can order an investigation, and, if necessary, suspend fund releases for the related scheme. 
• Remuneration Systems: Wages are deposited directly into workers’ bank/Aadhaar-linked accounts to ensure transparency.  
  • Workers receive 0.05% daily compensation on delayed payments starting from the 16th day after muster roll closure.  
  • Financial support is provided in cases of on-site fatalities or permanent disabilities. 
• Equity Measures: Mandates one-third female participation to ensure equitable work opportunities. In forest areas, tribal families without private assets (excluding Forest Rights Act (FRA), 2006 land rights) qualify for enhanced employment provisions. 
• Digital Infrastructure:  
  • GeoMGNREGA Platform: For geographic tagging of created assets across all Gram Panchayats. 
  • JanMGNREGA Mobile Application: Facilitate attendance recording, payment tracking, asset mapping, feedback submission, complaint resolution. 
  • NREGASoft Information System: Record all activities under the MGNREGA. 

What are the Key Challenges Facing the MGNREGA Scheme? 

• Delays in Wage Payments: Frequent wage delays arise from ABPS glitches, bank mismatches, and bureaucratic hurdles. The mandated 0.05% daily delay compensation is rarely paid. 
  • E.g., In 2021, the Centre owed Rs 7,500 crore to West Bengal, out of which labour wages alone amounted to Rs 2,744 crore. 
  • Substantial variations in wage rates across states (ranging from Rs 220 to Rs 350+) create migration pressures. 
• Corruption and Leakage: Fake job cards and ghost workers divert funds through fictitious beneficiaries, while material theft occurs via the diversion or over-invoicing of project supplies. 
  • E.g., Centre invoked Section 27 of MGNREGA Act, 2005 due to widespread irregularities in implementation (fake job cards, misappropriation, improper work allocation etc). 
• Ineffective Social Audits: Social audits are often ritualistic with limited participation and inadequate auditor training, while workers fear retaliation, which discourage genuine participation and suppress findings. 
• Poor Quality of Assets: Poor workmanship causes many built assets to deteriorate rapidly, and the absence of dedicated maintenance accelerates their degradation.  
  • The focus on short-term, and labor-intensive earthwork results in infrastructure with limited long-term utility. 
• Digital Divide: Digital initiatives like the JanMGNREGA app can exclude those without digital literacy or smartphone access. Mandatory Aadhaar seeding further marginalizes workers lacking reliable biometric authentication documents e.g., forest-dwelling tribal communities.  

What Steps are Needed to Strengthen MGNREGA Scheme? 

• Capacity Building Programs: Empower gram panchayats with real financial and administrative authority for autonomous project management.  
  • Support them with dedicated block level technical cells staffed by engineers and specialists to ensure quality design and oversight. 
• Adequate and Timely Funding: Frame budgets on realistic employment demand rather than past allocations, and create district-level contingency funds (10–15%) for emergencies. Mandate timely state release of 25% material costs with penalties for delays to ensure project flow. 
  • E.g., In WB, the labour budget will be allotted quarterly, based on performance and compliance. Usually, it is approved for the full year. 
• Technology-Enabled Transparency: Mandate 100% geo-tagging with photo uploads at all project stages and video documentation for high-value works.  
  • Implement machine learning to analyze payment patterns, attendance records, and work measurements to flag anomalies, and pilot blockchain for immutable, direct worker payments. 
  • E.g., the Center directed 100% electronic KYC (e-KYC) for all workers, 100% Aadhaar seeding and mandatory wage payments via the Aadhaar Payment Bridge System (APBS) in WB. 
• Fair and Adequate Wages: Offer higher wage rates for certified barefoot technicians (local individuals trained to provide basic technical support for MGNREGA works) and skilled tasks. Enforce a strict 15-day payment deadline with automatic penalties for delays. 

Conclusion 

The resumption of MGNREGA in West Bengal underscores a critical push for transparency and accountability amid corruption allegations. This case highlights the scheme's potential as a social safety net and the ongoing tension between central oversight and decentralized implementation for effective governance. 

Drishti Mains Question:

Q. Persistent issues of wage delay and asset quality plague MGNREGA. Suggest institutional and technological reforms to address these core implementation challenges.

Frequently Asked Questions (FAQs) 

Q. What is the significance of Section 27 of the MGNREGA Act, 2005? 
It grants the Central Government oversight powers to issue directives, order investigations, and stop fund release to states in cases of malpractice, ensuring national scheme integrity. 

Q. What digital initiatives support MGNREGA implementation? 
Key platforms are GeoMGNREGA (asset geo-tagging), Janmanrega app (attendance, payments, grievance redressal), and NREGASoft (central MIS for all activities). 

Q. How does MGNREGA aim to ensure gender equity? 
The scheme mandates that at least one-third of beneficiaries must be women, promoting female workforce participation and equitable access to wage employment. 

UPSC Civil Services Examination, Previous Year Question (PYQ)  

Prelims 

Q. Among the following who are eligible to benefit from the “Mahatma Gandhi National Rural Employment Guarantee Act”? (2011)

(a) Adult members of only the scheduled caste and scheduled tribe households  

(b) Adult members of below poverty line (BPL) households  

(c) Adult members of households of all backward communities  

(d) Adult members of any household  

Ans: (d)

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Mains 

Q. “An essential condition to eradicate poverty is to liberate the poor from the process of deprivation.” Substantiate this statement with suitable examples. (2016)

Q. “Poverty alleviation programs in India remain mere showpieces until and unless they are backed up by political will.” Discuss with reference to the performance of the major poverty alleviation programmes in India. (2015)