MBA- Insurance & Banking

Name- Puja Kumari Roll No- 16 Article On- NREGA Source- The Economic Times, 18th

August 2011

4/21/12

4/21/12

INTRODUCTION
The Mahatma Gandhi National

Rural Employment Guarantee Act (MGNREGA) is an Indian job guarantee scheme ,enacted by legislation on aug 25 ,2005
The central government outlay

for the scheme is rupees 40,000 crore in the financial year 201011.
The law was initially called the
4/21/12 National Rural Employment

OBJECTIVES
The Government plans to focus its

flagship rural plan jobs guarantee plan on the poorest districts of the country.

The Act guarantees 100 days of

employment in a financial year to any household whose adult members are willing to do unskilled manual work at the statutory minimum wage of
4/21/12

 The scheme was initially

introduced in 200 poorest districts of and eventually extended to all of Indias 600 districts.
This act was introduced with the

aim of improving the purchasing power of rural people.

The scheme was meant to address

migration from the most backward 4/21/12 and poorest regions and that

THE PLAN
The act directs state govt. to

implement MNREGA schemes.

Under the MNREGA scheme, Central

Govt. meets the following cost: 1. Cost towards the payment of wage 2. 3/4 of the material cost. 3. Some percentage of administrative cost.
Since the Govt. pays the
4/21/12 unemployment allowance, they are

PROVISIONS UNDER NREGA

Adult members of a rural household

may apply for the local Gram Panchayat.

The Gram Panchayat after due

verification will issue a Job Card.

The Job Card should be issued within

15 days of application.
The Gram Panchayat will issue a

dated receipt of the written application for employment, against which the guarantee of providing
4/21/12

 Employment will be given within

15 days of application for work, if it is not then daily unemployment allowance as per the Act, has to be paid liability of payment of unemployment allowance is of the States.
Work should ordinarily be provided

within 5km radius of the village. In case work is provided beyond 5km, extra wages of 10% are 4/21/12

 Wages are to be paid according to

piece rate or daily rate.

At least one-third beneficiaries shall

be women who have registered and requested work under the scheme.
Permissible works predominantly

include water and soil conservation, afforestation and land development works.
4/21/12

 A 60:40 wage and material ratio has

to be maintained. No contractors and machinery is allowed.

The Central Govt. bears the 100

percent wage cost of unskilled manual labour and 75 percent of the material cost including the wages of skilled and semi skilled workers
All accounts and records relating to

the Scheme should be available for 4/21/12

IMPLEMENTATION
The plan was launched in February

2006 in 200 districts and eventually extended to cover 593 districts. provided jobs under NREGA during 2008-09, with an national average of 48 working days per household.

44,940,870 rural households were

4/21/12

FUNDING
MNREGA started with an initial outlay of

$2.5bn(Rs 11300cr) in year 2006-07.The funding has considerably been increased as shown in the table below:
Year Total Outlay(TO) Wage Expenditure(Percent of TO) 66 68 67
4/21/12

2006-07 $2.5 bn 2007-08 $2.6 bn 2008-09 $6.6 bn

EMPLOYMENT UNDER NREGA

Indian Minister of State for Rural

Development Mr. Pradeep Jain said in a written reply to a question in Rajya Sabha on Tuesday that, As of 30 June, a total of 179,43,189 families in the country have been provided employment under MGNREGA.
4/21/12

WORKS/ACTIVITIES
The MGNREGA stipulates that works

must be targeted towards a set of specific rural development activities such as: water conservation and harvesting, afforestation, rural connectivity, flood control and protection such as construction and repair of embankments, etc.

4/21/12

 Digging of new tanks/ponds,

percolation tanks and construction of small check dams are given importance.
First a proposal is given by the

Panchayat to the Block Office and then the Block Office decides whether the work should be.

4/21/12

MEASURES OR IMPROVEMENT OF THE SCHEME

The resources could have been

used to improve the monitoring and administration in needy districts and go for targeted intervention in states where the demand is low.
The government will initially focus

attention on strengthening the institutional arrangements for better delivery of the scheme in selected districts.
4/21/12

 It has asked the State Governments

to use 6% of the corpus to build institutional capacity including the bank correspondent model, but it may allow higher amounts in states with poorest districts in the future.
The Government is likely to expand

the scope of works under the scheme to accommodate state specific rural activities like horticultural, organic farming, animal rearing activities.
4/21/12

CURRENT SITUATION OF THE SCHEME

Activities under the scheme are

currently restricted to drought proofing and small village infrastructure projects like rural roads.

4/21/12

THAN K YOU..!
4/21/12