States must contribute to mgnregs wages says union minister giriraj singh

States must contribute to mgnregs wages says union minister giriraj singh

About 57% of the active workers under MGNREGS will be excluded by the Centre’s latest order making it mandatory for wages to be paid via Aadhaar-based accounts only.

The financial burden of wages to the beneficiaries of Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) should also be shouldered by State governments, in order to make them more proactive in controlling corruption, Union Rural Development Minister Giriraj Singh said on Thursday, in response to a query from The Hindu.

Meanwhile, academics and activists working under the umbrella body of NREGA Sangarsh Morcha expressed alarm over his Ministry’s latest order, which makes Aadhaar-based payment for wages mandatory. According to the ministry’s own data, this will exclude 57% of the active workers.

Speaking on the side-lines of a press conference in Delhi, Mr. Singh said that MGNREGS should not be treated as a regular employment scheme, as it is only meant to be a fall-back mechanism for those who can’t find employment anywhere else. When asked by The Hindu about an ongoing 100-day dharna by MGNREGA workers at the Jantar Mantar in Delhi, demanding that the government withdraw the mobile phone application-based attendance capturing system, the Minister reiterated that the government could not compromise on transparency.

Going a step further, he remarked, “I believe that we should go to Parliament to amend the MGNREGA law to change the contribution [pattern] to a 60-40 [split between the Centre and the States], instead of the Centre bearing 100% of the wage bill. When the States partially bear the burden, they will be more vigilant regarding corruption.” The 2023-24 Union Budget allocation for MGNREGA was cut 33% in comparison to the previous year’s revised estimates.

Aadhaar link mandatory

So far, under the Act, the Centre bears 100% of the wages, which are directly paid to the workers’ accounts and must be transferred within 15 days of them completing their work. On January 30, the Ministry issued an order tweaking the mode of wage payments, with effect from February 1.

Until now, the MGNREGA system allowed two modes of wage payment: “account-based” or “Aadhaar-based”. The former is a plain bank transfer. The latter uses Aadhaar as a financial address and sends money to the person’s “last Aadhaar-linked account”. In its circular, the ministry argued that the switch to Aadhaar-based payments only is being done to “ensure effective implementation” of the programme.

Addressing a press conference under the banner of the NREGA Sangharsh Morcha, activists Nikhil Dey, Yogendra Yadav and Jean Dreze said that the move was disastrous and would deal a body blow to the programme.

Excluding 57% of workers

“For the Aadhaar-based option to work, not only must the worker’s job card and bank account be seeded with Aadhaar, the account also has to be connected to the National Payments Corporation of India. This connection, known as mapping, can be very cumbersome, because it requires meeting stringent KYC [Know Your Customer] requirements, resolving possible inconsistencies between the Aadhaar database and the bank account,” Mr. Dreze, who joined the meeting via video conferencing from Jharkhand, explained.

Because of the complicated nature of this process, only 43% of active MGNREGA workers currently use Aadhaar-based payments, according to the Ministry’s own records, despite a relentless push from the government. “By this order, the government, in effect, is saying that 57% of the workers won’t be paid,” Mr. Dey said.

‘Artificially reducing demand’

This added hurdle, along with the mandate to capture attendance data via a mobile-based app which the workers are having trouble navigating, will automatically depress the demand for work under the scheme, he said. It could take anywhere from several weeks to several months for the workers to comply with the new rule because of the elaborate paperwork, Mr. Dey added.

Mr. Yadav said that the two measures – Aadhaar-based payments and capturing attendance data through a mobile application – have to be seen in the context of the drastic cut in the Union Budget’s allocations for the scheme. “We no longer need to speculate on why was the Budget so drastically cut. The government knew very well what it was doing. By adding so many filters, it artificially wants to bring the demand down and thus lower expenditure,” Mr. Yadav said.