Bogus demands under MNREGA received from some states: FinMin source

The Union Budget allocation for MNREGA is at Rs 60,000 crore in 2023-24 which was a steep cut from last year's outlay of Rs 89,400 crore. (Representative Image)

While assuring that the demands under the Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA) will be met, top finance ministry sources on November 6 raised the issue of bogus demands being received from certain states.

"The issue under MNREGA is not a shortage of funds. The issue is different which is not being highlighted. There are irregularities under MNREGA for which complaints have been received. Some states are sending bogus demands," a senior finance ministry source said.

The Union Budget allocation for MNREGA is at Rs 60,000 crore in 2023-24 which was a steep cut from last year's outlay of Rs 89,400 crore.

The government has already utilised the budgeted allocation of Rs 60,000 crore this year. Since over four months are still remaining in this fiscal the government is likely to raise the MNREGA allocation in the supplementary demand in the next Parliament session.

"When the government can extend the free foodgrain scheme for five years, why will we not have funds for MNREGA. There will be no shortage of funds under MNREGA. MNREGA is a demand driven scheme," the source said.

Earlier in August, Moneycontrol had reported that the finance ministry was not in favour of revamping the jobs scheme under the scheme by increasing spending as recommended by a government-appointed committee, and instead prefers pushing more funds towards infrastructure building.

“We (finance ministry) are not in support of the suggestions made by the committee. We can spend on higher capex instead of hiking MGNREGA wages as suggested by the Sinha committee,” a senior government official told Moneycontrol.

To be sure, the finance ministry will assess around October-December if there is a need for additional funds for the employment guarantee plan under MGNREGA in the current fiscal based on the demand scenario going ahead, the official added. In FY23, the central government increased the allocation for the rural job scheme to Rs 89,400 crore from Rs 73,000 crore due to a spike in demand for jobs under the scheme.

The law governing the flagship rural job programme, passed in 2005, provides guaranteed wage employment of 100 days in a financial year to a rural household whose adult members are willing to take up manual work. The demand under the scheme rose drastically during the COVID-19 pandemic.