Centre unlikely to alter budget for rural jobs scheme

The government is likely to maintain funding for the rural job guarantee program at near current year levels in the upcoming budget as job demand under the program declines as economic activity has recovered in recent years. other areas, two officials familiar with the development said.

The Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) aims to secure the livelihoods of rural people, especially in times of stress.

Demand for program jobs tends to decline as relatively better jobs are available in cities.

“The allocation may not see any major increase, as demand for jobs under this scheme has fallen this year and economic activity is picking up. With people returning to cities, it’s unlikely that demand will spike anytime soon,” said one of the two officials, who requested anonymity.

Questions sent to the spokespersons of the ministries of finance, panchayati raj and rural development remained unanswered as of press time.

Budget allocation for MGNREGS has been reduced by 33% to $73,000 crore in fiscal year 23 words $96,812 crore revised budget estimates for the previous year. The annual allocation has decreased as the covid situation subsided, reducing demand for MGNREGS jobs and as people return to the city for better jobs.

Demand for jobs under MGNREGS has increased during peak covid times when closures forced migrants to return home.

According to data from the rural jobs program website, the total number of man days created so far in fiscal year 23 is 2.12 billion, compared with 3.63 billion mandays created in 2022.

Finance Minister Nirmala Sitharaman told Parliament last week that demand for the popular program has decreased.

“In rural areas, demand for MGNREGS has been decreasing in recent times,” the finance minister said, adding that the program is driven by demand and is on a declining trend. .

During the first half of the current financial year, demand for MGNREGS fell by 18%, with a total of 1.72 billion mandays supplied, compared with 2.10 billion mandays in the previous year.

During the first covid pandemic in fiscal year 21, the program generated a record 2.26 billion person-workdays.

Experts say the drop in job demand suggests that migrant workers who returned to their homeland during the pandemic are returning to urban areas as economic activity recovers.

Although total employment demand under MGNREGS fell to 162.4 million person-days in October, the lowest level in the financial year, it recovered in November with a 19% increase to 194 million. person-day.

According to officials cited earlier, the drop in demand could be partly attributed to the need for a larger workforce in urban centers to meet the growing demand of the infrastructure sector.

As a result, providing higher support through MGNREGS may discourage workers from seeking more productive employment opportunities in urban areas, hindering labor availability in areas with more opportunities. more social.

Despite the drop in demand in fiscal year 23, the government sought Congressional approval for the supplement $16,400 crore for the program according to additional funding need, above budget $73,000 cores. So far, the Center has released a total of $62,929 crore for this financial year, according to MGNREGs.

MGNREGS, introduced in 2005, aims to provide at least 100 working days in a fiscal year to every rural household in India.

The program offers jobs such as road construction, well digging, and canal construction, among other rural infrastructure development jobs.

The program also serves as a backup source of employment for rural households when better employment opportunities are not available.

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