The Mahatma Gandhi National Rural Employment Guarantee Act, earlier known as the National Rural Employment Guarantee Act was passed on 7th September 2005 to augment employment generation and social security in India. It covers all districts of India except the ones with 100% urban population.
As per the latest announcement made by the Finance Minister Nirmala Sitharaman on March 26th, 2020, the workers under the MGNREGA would get a hike of Rs. 2000 each on an average. It was also announced that three crore senior citizens, persons with disabilities and widows will get one-time additional amount of Rs 1,000 in two installments which will be provided through DBT (Direct Benefit Transfer) over a period of three months. This announcement was made as an initiative towards the loss caused by the Covid-19 outbreak. The 21 days lock down is expected to cost the Indian Economy a cost of around 9 lakh crores. Funds worth Rs 31,000 crore are also to be provided to augment medical testing, screening and providing better healthcare facilities to those who have been affected financially due to the Covid-19 outbreak.
It is an important topic for the General Studies Syllabus of the UPSC for Civil Services Exam 2020. This government scheme is covered under Economic and Social Development for Prelims and Economy for Mains.
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In 1991, the P.V Narashima Rao government proposed a pilot scheme for generating employment in rural areas with the following goals:
- Employment Generation for agricultural labour during the lean season.
- Infrastructure Development
- Enhanced Food Security
This scheme was called the Employment Assurance Scheme which later evolved into the MGNREGA after the merger with the Food for Work Programme in the early 2000s.
Objectives of MGNREGA:
The Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) has the following objectives:
- Provide 100 days of guaranteed wage employment to rural unskilled labour
- Increase economic security
- Decrease migration of labour from rural to urban areas
MGNREGA differentiates itself from earlier welfare schemes by taking a grassroots-driven approach to employment generation. The programmes under the act are demand driven and provide legal provisions for appeal in case, work is not provided or payments are delayed. The scheme is funded by the central government which bears the full cost of unskilled labour and 75% of the cost of material for works undertaken under this law. The central and state governments audit the works undertaken under this act through annual reports prepared by CEGC (Central Employment Guarantee Council) and the SEGC (State Employment Guarantee Councils). These reports have to be presented by the incumbent government in the legislature.
A few salient features of the scheme are:
- It gives a significant amount of control to the Gram Panchayats for managing public works, strengthening Panchayati Raj Institutions. Gram Sabhas are free to accept or reject recommendations from Intermediate and District Panchayats.
- It incorporates accountability in its operational guidelines and ensures compliance and transparency at all levels.
Ever since the scheme was implemented, the number of jobs has increased by 240% in the past 10 years. The scheme has been successful in enhancing economic empowerment in rural India and helping overcome the exploitation of labour. The scheme has also diminished wage volatility and the gender pay gap in labour.
This law and the employment guarantee schemes which are part of its provisions are important from the IAS exam point of view. UPSC aspirants should read about this government scheme in detail as questions related to this topic are asked in the Prelims exam and in General Studies paper II. The questions for government schemes like MGNREGA are classified under Welfare schemes, and the topic has a significant overlap with topics like human development, poverty and hunger.
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