MGNREGA allocation remains unchanged at Rs 86,000 crore in FY25 Budget

The rural job plan is a demand driven scheme aimed at generating employment between sowing and harvesting during the lean period

The Union government allocated Rs 86,000 crore for the job guarantee scheme under the Mahatma Gandhi National Rural Employment Guarantee Act for FY25, which is exactly the same outlay as given in the revised estimates for the current financial year.

As per the revised estimates for 2023-24, the outlay for the flagship scheme is Rs 86,000 crore sharply higher than the Budget estimate of Rs 60,000 crore for the current fiscal.

Allocation for the rural job scheme under MGNREGA recorded a steep cut of 33 percent in the FY24 Budget compared to the revised estimate of Rs 89,400 crore in the financial year 2022-23. Following this, the Union government on December 6 sought the Lok Sabha's approval to spend an additional Rs 14,524 crore for the scheme in the current fiscal as part of its first batch of supplementary demands for grants.

Initiated as a safety measure to provide jobs between sowing and harvesting during the lean period, the law governing the flagship rural job programme provides guaranteed wage employment of 100 days in a financial year to rural households whose adult members are willing to take up manual work.

Aimed at generating employment, the rural job plan is a demand-driven scheme that was passed by the Parliament in August 2005 and was implemented in February 2006 in the country’s poorest districts. Later, the scheme was extended across the country in 2008.

Though the budget allocation for MGNREGA has reduced by 13 percent to Rs 61,500 crore in 2020-21, the demand under the scheme rose drastically during the COVID-19 pandemic. Recognising the scheme as a potential source of employment during the crisis, its outlay was increased to Rs 1.11 lakh crore under the Atmanirbhar Bharat stimulus package, which was unveiled in May 2020.

During the current fiscal, the demand for employment under MGNREGA has risen owing to the fallout of an uneven monsoon.

Separately, the Union government has taken steps to plug leakages in the flagship rural job scheme ranging from mandatory digital attendance of workers through the National Mobile Monitoring System to ensuring wages are paid through Aadhaar-linked bank accounts.