Resource centre on India's rural distress
 
 

Right to Work (MG-NREGA)

 

KEY TRENDS 

 

• The proportion of households which completed 100 days of wage employment under MGNREGA in total households that worked was 6.02 percent in 2014-15, 10.07 percent in 2015-16, 7.79 percent in 2016-17 and 5.78 percent in 2017-18 @$

• Completed works as a proportion of total works was 30.15 percent in 2014-15, 29.39 percent in 2015-16, 40.27 percent in 2016-17, 32.01 percent in 2017-18 and 3.3 percent in 2018-19 (as on 7th May, 2018) @$

 

• In drought affected states, 28.35 lakh households were provided more than 100 days of employment in 2015-16. In other words, only 5.9 percent of all households in drought affected states got more than 100 days of employment (provided drought is notified in a state or if a state has given additional days of employment) $$

• Although 5.35 crore households demanded employment, only 4.82 crore households got employment under MGNREGA in 2015-16. It means that 9.9 percent of households were not provided employment under MGNREGA despite making demand $$
 

• Analysis of household survey data from Bihar shows that under ideal conditions, the rural poverty rate of 50% at the time of the survey could come down by at least 14 percentage points. However, compared to a potential reduction in poverty by 14 percentage points, actual impact on rural poverty is only about 1 percentage point $

• The World Bank study has highlighted a number of reasons why the potential impact of MGNREGS may not be realized in practice: the supply side is too slow to respond to the demand for work on the scheme; workers are not paid the full scheme wage; delays in wage payment; and awareness of how to demand work is limited $

 

• About 38.4% of the households in rural areas had MGNREGA job cards during July 2011 to June 2012 #

 

• Among rural persons of age 18 years and above registered in MGNREG job cards, 50.5% got work in MGNREGA work, 18.8% sought but did not get MGNREG works and 30.5% did not seek work in MGNERG work during July 2011 to June 2012 #

 

• Employment provided to the SC households (in person days) stood at 78.75 crore during 2010-11, 46.6 crore during 2011-12 (as on 30.01.2013) and 32.61 crore during 2012-13 (as on 30.01.2013). Employment provided to the ST households (in person days) stood at 53.61 crore during 2010-11, 38.38 crore during 2011-12 (as on 30.01.2013) and 22.70 crore during 2012-13 (as on 30.01.2013) @

• Percentage of unspent amount (of total available funds) under the MGNREGA stood at 27.31% during 2010-11, 22.11% during 2011-12 (provisional) and 32.82% during 2012-13 (as on 30.01.2013). Huge unspent balances were lying with some big States such as Uttar Pradesh, Bihar, Madhya Pradesh, Rajasthan etc @

• The Standing Committee is astonished to note that so far only 4078 workers were paid unemployment allowances in 8 States during 2006-09 and Rs. 1,23,589 has been paid to eligible beneficiaries in 2010-11 in six States @

• The Standing Committee noted that 2,91,776 Social Audits have been conducted during 2011-12 in 1,72,852 Panchayats out of 2,48,204 Gram Panchayats in the country. The Committee also found that so far 263 Ombudsman (for grievance redressal) have been appointed in 22 States @

• The Standing Committee expressed its astonishment to note that despite constitution of District Planning Committees (DPCs) in most of the States, PRIs have not been able to formulate District Perspective Plan, a necessary condition of effective utilization of funds available under MGNREGA @

• Analysis of data by the CAG related to the performance of the scheme showed that there has been significant decline in per rural household employment generation in the last two years. Per rural household employment, declined from 54 days in 2009-10 to 43 days in 2011-12. There was also a substantial decline in the proportion of works completed in 2011-12. Bihar, Maharashtra and Uttar Pradesh, which together account for 46 percent of the rural poor, utilized only about 20 percent of the central scheme funds. This indicated that the correlation between poverty levels and implementation of MGNREGA was not very high *$
 
• In 10 states and 4 UTs, Government had not constituted Social Audit Units to facilitate the social audit forums. In 11 states and one UT, it was seen that significant fewer social audits from prescribed norms were conducted *$

• Deficiencies, relating to both non-maintenance and incorrect maintenance of prescribed basic records, were noticed in 18 to 54 percent of the all test checked Gram Panchayats, for various types of records. Widespread deficiencies in the maintenance of records restricted the process of proper verification of the outputs and outcomes of the scheme *$
 
• Percentage share of employment availed by women under MGNREGA was 40% during 2006-07, 43% in 2007-08, 48% in 2008-09, 48% in 2009-10 and 48% in 2010-11. Hence, the percentage of women beneficiary under MGNREGA has been much higher than provided under the Act (i.e. 33% of total employment)

• Out of total 26.69 crore registered workers under MGNREGA for whom job cards have been issued so far, 11.62 crore (43.53%) are women. In 2010-2011, out of the total of 8.73 crore workers who requested for work, 3.92 crore (44.9%) were women
 
@$ Official MGNREGA website http://nrega.nic.in/netnrega/home.aspx (as on 7th May, 2018)
 
$$ MGNREGA: Performance, Initiatives and Strategies (FY 2015-16 and FY 2016-17), please click here to access the report
 
$ India Development Update: Towards a Higher Growth Path, World Bank, April 2015 (please click here to access)
 
# NSS 68th Round Report: Employment and Unemployment Situation among Social Groups in India (released in January 2015), please click here to download the report
 
@ 42nd Standing Committee Report (2012-13) on Rural Development entitled: Implementation of MGNREGA, 2005 presented to Lok Sabha on 14.08.2013, (please click here to access)

*$ Report of the Comptroller and Auditor General (CAG) of India on Performance Audit of Mahatma Gandhi National Rural Employment Guarantee Scheme, Report no.-6 of 2013-Union Government (Ministry of Rural Development),

http://saiindia.gov.in/english/home/Our_Products/Audit_Report/Government_Wise/union_audit/recent_reports/union_performance/2013/Civil/Report_6/Report_6.html

Mahatma Gandhi National Rural Employment Guaranty Act (MGNREGA) and Empowerment of Women in Rural Areas by Parliamentary Committee on Empowerment of Women (2011-12), Fourteenth Report, Lok Sabha Secretariat, May, 2012, http://www.im4change.org/docs/692mgnrega_report.pdf


 

OVERVIEW 

 

The NREGA evokes extreme reactions from supporters and opponents. When the scheme was launched in 200 districts in 2005, and later expanded to cover the entire country in 2008, its advocates hailed it as the beginning of a new era for rural India. However, it enraged India’s influential neo-liberal economists so much that one of them claimed he had found a better way of ‘wasting’ public money: showering of currency notes from helicopters. For now, the skeptics are silent mainly because of three reasons, a) the scheme is widely regarded as successful, b) It is being hailed as an important reason for the UPA’s return to power, and c) the recession-hit Western world is swearing by public expenditure on welfare. Of late, their criticism is mainly confined to corruption and malpractices, which, in all fairness, are rampant though not insurmountable. 

The NREGA differs from most poverty mitigation schemes so far in one fundamental way: It recognizes employment as a legal right. Its fringe benefits include inclusion of the rural poor in the banking system, regeneration of community assets and gender equality. The enactment of NREGA also signifies coming of age of Indian advocacy and civil society activism. The credit for converting a somewhat utopian idea into a policy push goes to numerous civil society activists, committed experts and grassroots organizations who worked for years to achieve this. Many of these activists are now working on effective social audits and a system of compensations for delay in wage payments.

Some leading NGOs in Chhattisgarh, Rajasthan and Andhra Pradesh have enrolled graduate students from leading universities and hip urban youths to run NREGA helpdesks. At places they are also helping in conducting social audits. For instance a month-long struggle with the help of young Delhi University volunteers led to a compensation of Rs 2000 each to 174 villagers in Khunti and Murhu blocks in Jharkhand amounting to Rs 3.48 lakh in June 2009. These villagers’ wages had been delayed in gross violation of the statutes.   
 
Despite the optimism generated by the implementation of the NREGA, it runs the risk of degenerating into yet another government dole in the absence of comprehensive reforms in India’s local governance and public service delivery mechanism. Many experts argue that an effective execution of the NREGA requires a cadre of functionaries accountable to the village Panchayats with adequate funding and a comprehensive roadmap.

 

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Please click here to access the [inside]Status of Social Audit in MGNREGA as on 11th May, 2018[/inside].


The [inside]Status of MGNREGA as on 7th May, 2018[/inside] can be checked from the official MGNREGA website http://nrega.nic.in/netnrega/home.aspx :

• The approved labour budget is 229.89 crore person-days in 2018-19, which is 0.61 percent less than what was approved in 2017-18 viz. 231.31 crore person-days. The approved labour budget was 220.67 crore person-days in 2014-15, 239.112 crore person-days in 2015-16 and 220.9274 crore person-days in 2016-17.

• Labour Budget (LB) under MGNREGA refers to advanced labour estimate for execution of a shelf of works for the next financial year. The advance assessment of labour demand in a district takes into account seasonality aspects along with the examination of employment and livelihood opportunities in the respective rural areas. On the basis of LB estimates, the Central Government projects its central liability towards the districts. For more information, go to https://bit.ly/2HX9ISI , https://bit.ly/2FQBuKB,     

 

• Person-days of work generated as a proportion of total labour budget was 75.32 percent in 2014-15, 98.34 percent in 2015-16, 106.66 percent in 2016-17 and 101.28 percent in 2017-18. It, therefore, shows that the gap between MGNREGA jobs generated (in terms of person-days) and the number of person-days of work as predicted by the authorities has reduced over the years and the former exceeded the latter in 2016-17 and 2017-18.

• Person-days created for Scheduled Caste (SC) individuals as a proportion of total person-days generated was 22.4 percent in 2014-15, 22.29 percent in 2015-16, 21.32 percent in 2016-17, 21.48 percent in 2017-18 and 18.73 percent in 2018-19 (as on 7th May, 2018).

• Person-days created for Scheduled Tribe (ST) individuals as a proportion of total person-days generated was 16.97 percent in 2014-15, 17.8 percent in 2015-16, 17.62 percent in 2016-17, 17.6 percent in 2017-18 and 19.68 percent in 2018-19 (as on 7th May, 2018).

• Person-days created for women as a proportion of total person-days generated was 54.88 percent in 2014-15, 55.26 percent in 2015-16, 56.16 percent in 2016-17, 53.46 percent in 2017-18 and 53.75 percent in 2018-19 (as on 7th May, 2018).

• The average number of days of employment provided per household was 40.17 days in 2014-15, 48.85 days in 2015-16, 46.0 days in 2016-17, 45.78 days in 2017-18 and 14.04 days in 2018-19 (as on 7th May, 2018).

• The average wage rate per day per person was Rs 143.92 in 2014-15, Rs. 154.08 in 2015-16, Rs. 161.65 in 2016-17, Rs. 169.46 in 2017-18 and 174.89 in 2018-19 (as on 7th May, 2018).

• The proportion of households which completed 100 days of wage employment in total households that worked was 6.02 percent in 2014-15, 10.07 percent in 2015-16, 7.79 percent in 2016-17 and 5.78 percent in 2017-18.

• The total number of individuals who worked in MGNREGA was 6.22 crore in 2014-15, 7.2261 crore in 2015-16, 7.6693 crore in 2016-17 and 7.59 crore in 2017-18 and 1.4 crore in 2018-19 (as on 7th May, 2018).

• The total number of gram panchayats with 'nil' expenditure was 39,531 in 2014-15, 39,469 in 2015-16, 19,451 in 2016-17, 11,494 in 2017-18 and 77,708 in 2018-19 (as on 7th May, 2018).

• Completed works as a proportion of total works was 30.15 percent in 2014-15, 29.39 percent in 2015-16, 40.27 percent in 2016-17, 32.01 percent in 2017-18 and 3.3 percent in 2018-19 (as on 7th May, 2018).

• The proportion of 'Category B' works in total works was 21.4 percent in 2014-15, 33.8 percent in 2015-16, 51.41 percent in 2016-17, 60.11 percent in 2017-18 and 63.73 percent in 2018-19 (as on 7th May, 2018). 'Category B' works are related to individual assets for vulnerable sections (only for households in Paragraph 5 of Schedule I). For more information, go to https://bit.ly/2KCSnvT

• The proportion of expenditure on 'agriculture & agriculture allied works' in total expenditure related to MGNREGA works was 52.81 percent in 2014-15, 62.85 percent in 2015-16, 66.0 percent in 2016-17, 67.15 percent in 2017-18 and 75.35 percent in 2018-19 (as on 7th May, 2018).

• The proportion of MGNREGA funds from the Centre which was utilized was 95.84 percent in 2014-15, 101.43 percent in 2015-16, 101.18 percent in 2016-17, 94.33 percent in 2017-18 and 34.56 percent in 2018-19 (as on 7th May, 2018).

• As on 7th May, 2018, around 57 percent of the Fund Transfer Orders (FTOs) for MGNREGA wage payments sent to the Public Financial Management System (PFMS, https://pfms.nic.in/NewDefaultHome.aspx) in April 2018 remain unprocessed. A high proportion of FTOs of the last few months are also yet to be processed – nearly 29.53 percent of the FTOs of March, 2018 and 16.8 percent of the FTOs of February, 2018.

 

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Please click here to access the revised [inside]MGNREGA wage rates in various states for 2018-19[/inside]

 

Please click here to access the [inside]Nagesh Singh Committee draft report on alignment of MGNREGA wages with minimum agricultural wages, submitted to the Ministry of Rural Development in July, 2017[/inside].

 

The key recommendations of the Nagesh Singh Committee draft report on alignment of MGNREGA wages with minimum agricultural wages are as follows:

• The Nagesh Singh Committee observed the fact that MGNREGA wages are currently indexed to CPI-AL of December month. The Committee recommended that the CPI-Rural Index for average of 12 months should be the proper index for indexing MGNREGA wages. This new indexation method could be followed for notification of wages to be effective from 01 April, 2018.

• The Nagesh Singh Committee recommended that the indexation of MGNREGA wages may be linked to Consumer Price Index for Rural India (viz. CPI-Rural), as the consumption basket of CPI-Rural is of more recent vintage than Consumer Price Index for Agricultural Labourers (viz. CPI-AL), although the CPI-Rural consumption weights pertain to 2004-05.

• In CPI-AL and Consumer Price Index for Rural Labourers (viz. CPI-RL), food beverages and tobacco account for over 70 percent of the consumption basket. In case of CPI-Rural, they account for only 59 percent. The CPI-Rural also provides for higher expenditure on Education, Medical care and Transport and Communication.

• The issue of divergence between wage rates under MGNREGA and minimum agricultural wages is on account of the fact that the states do not follow a uniform policy of wage revision for minimum agricultural wage.

• The Nagesh Singh Committee is of the opinion that the wage rates under MGNREGA are notified based on scientific principles of indexation. They should take into account the price level differences across states as the CPI-AL used for indexation of MGNREGA wages is taken for each state separately. The Committee felt strongly that the states should be persuaded to follow a uniform and scientific policy for indexation and notification of minimum wages for agricultural wages. In the Committee’s opinion, there is no compelling argument for convergence of minimum wages for agricultural labour and wages notified for NREGA workers in view of the differences in activities performed by these two set of workers which have been enumerated in the report.

Please click here to access the [inside]Prof. S Mahendra Dev Committee final report on MGNREGA wage rate indexation, submitted to the Ministry of Rural Development in 2015[/inside].

 

The key recommendations of the Prof. S Mahendra Dev Committee final report on MGNREGA wage rate indexation are as follows: 

• The baseline for MGNREGA wage indexation from 2014 may be the current minimum wage rate for unskilled agricultural labourers fixed by the states under the Minimum Wages Act or the current MGNREGA wage rate, whichever is higher
 
• The Consumer Price Index for Rural India (viz. CPI-Rural) may be considered as the appropriate index for protecting the wages against inflation and as such the CPI-Rural be adopted for revising wage rates every year under the Mahatma Gandhi National Rural Employment Act.

• A major drawback in using the Consumer Price Index for Agricultural Labourers (viz. CPI-AL) and the Consumer Price Index for Rural Labourers (CPI-RL) is that the weighting diagram is as old as 1983 since they are based on the weights derived from the consumer expenditure survey of that year. The Prof. Mahendra Dev Committee is of the opinion that the consumption pattern has changed significantly during the last 30 years. Given the thirty-year old weighting diagram, prices some of the items are not even available for data collection. In addition, new items of consumption must have also entered the consumption basket of the target groups. On the other hand, the weighting diagram for CPI-R is the recent 2004-05 consumer expenditure survey that would reflect the current pattern of consumption of the target groups. The prices of most of the items are collected for CPI-Rural.

• As CPI-AL and CPI-RL use old weights, cereals and products has 40 percent weight while the same thing for CPI-R was only 19 percent. In other words, food items have higher weights in CPI-AL and CPI-RL as compared to CPI-Rural.

• While the Labour Bureau of the Ministry of Labour and Employment, Government of India computes and publishes the CPI-AL and CPI-RL, the Central Statistical Organisation (CSO) of the Ministry of Statistics and Programme Implementation (MoSPI) computes and publishes the CPI-Rural. The present series of CPI-AL and CPI-RL take 1986-87 as the base year i.e. 1986-87=100.

• The CPI-AL and CPI-RL are compiled for 20 states and also for the entire nation on a monthly basis. However, the CPI-Rural is a newly constructed index and is being compiled from January, 2011 with 2010 as the base year. The CPI-AL covers the households of agricultural labourers and the CPI-RL covers the households of rural labourers (including agricultural labourers). The CPI-Rural, however, provides the price changes for the entire rural population of the country.
 

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The key findings of the report entitled [inside]MGNREGA: Performance, Initiatives and Strategies (FY 2015-16 and FY 2016-17)[/inside] are as follows (please click here to access the report):

• In the financial year 2015-16, 235.6 crore person days of wage employment was generated (against labour budget for 239.1 crore person days of employment), which was the highest in the last 5 years.

• Although 5.35 crore households demanded employment, only 4.82 crore households got employment under MGNREGA in 2015-16. It means that 9.9 percent of households were not provided employment under MGNREGA despite making demand.

• The average person days of employment per household in 2015-16 stood at 49 days, which was the highest in the past 3 years.

• Nearly 48.5 lakh households were provided at least 100 days of employment in 2015-16. Put simply, only 10.1 percent of all households in the country got at least 100 days of employment in that financial year.

• In drought affected states, 28.35 lakh households were provided more than 100 days of employment in 2015-16. In other words, only 5.9 percent of all households in drought affected states got more than 100 days of employment (provided drought is notified in a state or if a state has given additional days of employment).

• The average wage per person day during 2015-16 stood at Rs. 154.

• Rs. 43,848 crore was spent on MGNREGA in 2015-16, which was the highest since inception of the programme.

• In 2015-16, nearly 46.57 lakh hectares area of land benefited from public works relating to natural resources management such as water conservation, watershed management, irrigation, traditional water bodies, afforestation and land development.

• Out of the total works taken up under MGNREGA, 42 percent were dedicated for rural infrastructure, 34 percent for individual assets for the vulnerable, 22 percent for natural resources management and just 2 percent for common infrastructure for NRLM compliant self-help groups (SHGs).

• Out of the total expenditure on works taken up under MGNREGA, 45 percent was spent on rural infrastructure, 41 percent on natural resources management and 14 percent on individual assets for the vulnerable.

• Nearly 85 percent of total number of works started since inception till 31 March 2015 could be completed.

• MGNREGA works to improve productivity of lands benefitted 3.57 lakh households.

• MGNREGA works to improve livelihoods benefitted 8.2 lakh households.

• MGNREGA works to develop fallow or wastelands benefitted 7.17 lakh households.

• MGNREGA works to construct houses benefitted 11.53 lakh households.

• MGNREGA works to promote livestock benefitted 3.19 lakh households.

• About 10.78 crore accounts of active workers are in banks and post offices; 94 percent of the wages are credited into the accounts of the beneficiaries through an Electronic Fund Management System (EFMS). In 2016-17, over 60 percent payments could be made on time.

• MGNREGS is one of the finest examples of the Direct Benefit Transfer (DBT) initiatives of the Government.

• So far Aadhaar numbers have been seeded into NREGASoft database of around 7.05 crore workers and 2.86 crore workers (till the date of publication of the present report under discussion) have started getting their payments through Aadhaar Based Payment Bridge System (ABPS).

• There are plans to engage nearly 4000 Barefoot Technicians (BFTs) on the ground during the financial year 2016-17.

• The online Management Information System (MIS) portal of NREGS contains real time reports and records for over 6 lakh villages and work & payment details of 13 crore households, 28 crore workers, and around one crore works every year.

• In the financial year 2016-17, the states took upon themselves the targets related to farm ponds/ dug wells, vermicompost, Anganwadi Centres (AWCs), Individual Household Latrines (IHHLs) and road side plantations. As such, the states have targeted to construct 8,77,300 lakh farm ponds/ dug wells, 10.39 lakh vermicompost units, 6331 AWCs, 33 lakh IHHLs, and 49,482 kilometres of road side plantations. Besides, there is considerable thrust on individual asset creation like poultry, goatery and cattle sheds, soak pits etc. and various kinds of integrated natural resource management works.

The report entitled Performance, Initiatives and Strategies (FY 2015-16 and FY 2016-17) has provided a list of major challenges experienced in the implementation of MGNREGA, which are as follows:

• Unrealistic and improper planning at the Gram Panchayat-level.

• Delays in wage payment.

• Fund constraints

• Quality, durability and usefulness of assets can be questioned.

• Low awareness of the programme and less public participation.

• Lack of outcome based monitoring.

• Poor maintenance of records.

• Inadequate coverage of persons with disabilities (PwDs) and of women in some states.

• Non-compliance with transparency and accountability provisions.

• Lack of ICT infrastructure.

• Inadequate capacity of functionaries.

• Lack of adequate number of technical staff.

 

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According to the World Bank report entitled [inside]India Development Update: Towards a Higher Growth Path, published in April 2015[/inside] (please click here to access):

• With over 50 million beneficiary households, and expenditures between 0.5 and 1% of GDP, MGNREGA is amongst the largest anti-poverty programmes in the world.

• Analysis of household survey data from Bihar shows that under ideal conditions, the rural poverty rate of 50% at the time of the survey could come down by at least 14 percentage points. However, compared to a potential reduction in poverty by 14 percentage points, actual impact on rural poverty is only about 1 percentage point.

• At one end of the spectrum, the NREGS is shown to have delivered significant positive impacts on a range of outcomes -- from consumption and nutrition, to quality assets and productivity improvements, particularly for the poorest – in Andhra Pradesh. At the other end, impacts of the scheme in Bihar fall far short of potential.

• The World Bank study has highlighted a number of reasons why the potential impact of MGNREGS may not be realized in practice: the supply side is too slow to respond to the demand for work on the scheme; workers are not paid the full scheme wage; delays in wage payment; and awareness of how to demand work is limited.

• In Bihar, more than two-thirds – about 10 percentage points – of the gap between potential and actual impacts is attributable to the ways in which the NREGS is not fulfilling the provisions of the Act. The rest is due to the foregone income, i.e., an opportunity cost to the worker from giving up alternate employment in order to take up MGNREGS work. Forgone incomes are hard to avoid, but are important to the calculus when evaluating the net income gains from MGNREGS participation and its cost effectiveness against other alternatives.

• At the national level, 2009-10 National Sample Survey (NSS) data show a great deal of unmet demand. Almost 46% of households report that one or more members of their household would have liked to work on the scheme; only 25% secured any work over the course of the year.

• Participation rates in the scheme are not, as a rule, any higher in poorer states. There is greater demand for work on the scheme in poorer states, but also a lower capacity to meet that demand. As a result, the degree of unmet demand or rationing, i.e., the fraction of people who wanted work but did not get it, is bigger in the poorer states. In Bihar, unmet demand alone accounts for nearly three-fifths of the gap between potential and realized poverty impacts.

• Discrepancies between the scheme’s stipulated wage rates and actual wages received by workers also contribute to the gap between potential and realized impacts. In Bihar, on average, workers on the scheme received about 10% lower wages than the stipulated rate. This gap is not due to payment delays, as the gaps are estimated on total wages owed to the individual, not the amount actually received by the time of the survey.

• More recently, payment delays have emerged as a major bottleneck in program administration, and are a strong disincentive to participating in the program. National surveys highlight variation amongst states – in 2009/10 a survey found nearly 68% of MGNREGS beneficiaries received wages within 15 days in Andhra Pradesh. The same estimate for Rajasthan and MP were 10% and 23%.

• Despite government’s efforts to promote transparency and encourage monitoring from administration and civil society (social audits), MGNREGS is plagued by leakages. Leakage can take multiple forms, such as inflating the number of days worked per person, or registering fake persons to siphon off funds. Comparison of MGNREGS aggregate levels of employment reported in official data with independent measures based on household surveys show that the gap exists, but the range of available estimates is too wide to be conclusive. NSS-based estimates for 2007-08 can confirm only a quarter to half of MGNREGS employment recorded in official reports, depending on the method used.

• Specialized surveys with more detailed questions on participation and remuneration in the scheme suggest substantially lower estimates of leakage. For instance, the Bihar survey of MGNREGS implies a 20% gap between survey-based estimates of employment and official data in 2008-09 compared to the 2007-08 NSS-based estimate of 70% gap in the state.

• Even though MGNREGS is better targeted than a cash transfer scheme would be, wage earnings alone are not sufficient to make it more cost-effective at reducing poverty. But, it could be, if the assets created under it are of sufficient value to the poor. Other non-pecuniary benefits – like empowerment for socially vulnerable groups including women -- would further strengthen the case for workfare.

 

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The key findings of the [inside]NSS 68th Round Report: Employment and Unemployment Situation among Social Groups in India (released in January 2015)[/inside] pertaining to the participation of rural households in MGNREGA works are as follows (please click here to download the report):

(i) Households with MGNREG job cards and registration of persons in MGNREG job cards

• About 38.4% of the households in rural areas had MGNREGA job cards.

• A higher proportion of households belonging to ST or SC category had MGNREGA job cards than OBC or others category of households: 57.2% of ST households and 50% of SC households had MGNREG job cards as compared to 34.2% of OBC households and 27.1% of others category of households.

• About 23.7% of the rural persons of age 18 years and above were registered in MGNREG job card.

• Among persons of age 18 years and above, a higher proportion of males compared to females were registered in MGNREGA job card: nearly 28.1% of males compared to 19.4% of females were registered in MGNREGA job card.

• The proportion of persons of age 18 years and above registered in MGNREGA job cards was the highest, nearly 42.6% for persons belonging to ST households, followed by 30.9% for SC, 21% for OBC and the lowest 14.7% for persons in others category of households.

(ii) Status of getting work in MGNREG work among persons of age 18 years and above registered in MGNREG job cards

• Among rural persons of age 18 years and above registered in MGNREG job cards, 50.5% got work in MGNREGA work, 18.8% sought but did not get MGNREG works and 30.5% did not seek work in MGNERG work.

• Proportion of persons who got work in MGNREGA work was the highest among SC (55.6%), followed by ST (50.5%), OBC (49.1%) and was the lowest among others category (45.5%).

• The proportion of persons who sought but did not get work in MGNREGA work was the highest for others category of persons (21.9%) and it was the lowest among OBC (16.5%).

• The proportion of persons who did not seek work in MGNERG work was the highest among OBC (nearly 34.2%) and was the lowest among SC (24%), while it was 30.4% among ST and 32.5% among others category.
 

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Please click here to access the papers under the research project titled [inside]Impact Evaluation of Mahatma Gandhi National Rural Employment Guarantee Act in India[/inside].

The study is a collaborative effort of researchers from the International Food Policy Research Institute (IFPRI), Washington, D.C., Cornell University, Ithaca and the Indira Gandhi Institute of Development Research (IGIDR), Mumbai and funded by the International Initiative on Impact Evaluation (3ie). The goal of the study is to thoroughly evaluate the impacts of India’s Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), the largest public works project in the world.


Key findings of the [inside]42nd Standing Committee Report (2012-13) on Rural Development-NREGA[/inside] entitled: Implementation of MGNREGA, 2005 presented to Lok Sabha on 14.08.2013, (please click here to access) are as follows:

General Observations

•    The Standing Committee’s examination has revealed several disquieting features/ irregularities in the implementation of MGNREGA Scheme such as fudging of job cards, delay in payment of wages, non-payment of unemployment allowances, large number of incomplete works, poor quality of assets created and large number of cases of misappropriation and malpractices/ corruption etc. The Committee found that many States have failed to provide adequate support to PRIs such as dedicated personnel and other necessary infrastructure which is essential for efficient planning and implementation of works under the scheme. Similarly, many States are yet to establish grievance redressal authorities such as ombudsman.

Job Cards

•    The cumulative number of households issued job cards was 3,78,50,390 during 2006-07, 6,47,61,146 during 2007-08, 10,01,45,950 during 2008-09, 11,25,48,976 during 2009-10, 11,98,24,434 during 2010-11, 12,38,76,349 during 2011-12 (provisional) and 12,46,58,658 during 2012-13 (as on 02.11.2012).

•    The Standing Committee observed that during the last 7 years of the implementation of scheme, as many as 12.46 crore rural households out of 13.83 rural households (2001 census) have been registered and issued job cards in the country by State/UT Governments. However, the Committee noted that many discrepancies such as issue of fake job cards, inclusion of fictitious names, missing entry or delay in making entries in job cards, illegal custody of job cards by influential people etc. have been noticed. Similarly, complaints regarding non-issue of dated receipt to job applicants have been widely reported. The Committee are of the strong view that there is need to bring reform in the process of issue of job cards. The Committee is of the opinion that offences such as missing entries in the job cards and unlawful possession of job cards with influential people including elected representatives of PRIs or MGNREGA functionaries should be made punishable offence under section 25 of the Act.

Employment scenario

•    Against the guaranteed 100 days of unskilled waged employment under the Act, average person days per household were 43 during 2006-07, 42 during 2007-08, 48 during 2008-09, 54 during 2009-10, 47 during 2010-11, 43 during 2011-12 and during 2012-13 (up to 31 January, 2013) it is 36 days.

•    The Committee observed that average number of person days of employment provided per household in States with significant BPL population like Bihar (22 to 38 days) and West Bengal (14 to 35 days) were less than national average. The Committee is at loss to understand the logic of poor demand for work in States which have significant BPL population with less employment opportunities as compared to comparatively developed States.

•    Employment under MGNREGA demanded by households stood at 2.13 crore during 2006-07, 3.42 crore during 2007-08, 4.55 crore during 2008-09, 5.29 crore during 2009-10, 5.57 crore during 2010-11, 5.03 crore during 2011-12 (provisional) and 4.29 crore during 2012-13 (as on 30.01.2013). 

•    Employment under MGNREGA provided by households stood at 2.10 crore during 2006-07, 3.39 crore during 2007-08, 4.51 crore during 2008-09, 5.25 crore during 2009-10, 5.49 crore during 2010-11, 4.99 crore during 2011-12 (provisional) and 4.25 crore during 2012-13 (as on 30.01.2013). 

•    The total number of person days of employment generated under MGNREGA stood at 90.50 crore during 2006-07, 143.59 crore during 2007-08, 216.32 crore during 2008-09, 283.59 crore during 2009-10, 257.15 crore during 2010-11, 211.42 crore during 2011-12 (as on 30.01.2013) and 146.32 crore during 2012-13 (as on 30.01.2013). 

•    The Committee noted that 1348.89 crore person days employment has been generated during the last seven years of implementation of MGNREGA works. However, claim of the Government to provide employment to 29.98 crore households out of 30.28 crore households who demanded employment during the aforesaid period seems to be unbelievable in the absence of authentic data regarding number of days of employment demanded by households.

•    Person days of employment provided per household stood at 43 during 2006-07, 42 during 2007-08, 48 during 2008-09, 54 during 2009-10, 47 during 2010-11, 43 during 2011-12 (provisional) and 36 during 2012-13 (as on 30.01.2013). 

•    Average days of employment per household under MGNREGA during 2012-12 varied from 19 in Arunachal Pradesh to 69 in Tripura.

•    Total number of households that completed 100 days of employment under MGNREGA stood at 2161286 during 2006-07, 3601926 during 2007-08, 6521268 during 2008-09, 7083663 during 2009-10, 5561812 during 2010-11, 405442 during 2011-12 (provisional) and 970930 during 2012-13 (as on 30.01.2013). 

Employment to women

•    Women's participation in MGNREGA in terms of persondays of employment stood at 36.40 crore (40.2%) during 2006-07, 61.15 crore (42.58%) during 2007-08, 103.57 crore (47.88%) during 2008-09, 136.40 crore (48.69%) during 2009-10, 122.74 crore (47.73%) during 2010-11, 101.86 crore (48.17%) during 2011-12 (provisional) and 77.73 crore (54.0%) during 2012-13 (as on 30.01.2013). 

•    The Committee noticed that participation of women under MGNREGA works has been more than 40 percent in each of last seven years and that is more than the statutory requirement of 1/3 of the total beneficiaries. However, examination of the scheme by the Committee has revealed that participation of women in some States such as Assam, Bihar, Jharkhand, Odisha, Uttar Pradesh and West Bengal has been less than national average. The Committee also found that Assam, Bihar, Uttar Pradesh and West Bengal have failed to meet statutory requirement of providing 1/3rd employment to the women beneficiaries.

Employment to Scheduled Castes (SCs) and Scheduled Tribes (STs)

•    Employment provided to the SC households (in person days) stood at 22.95 crore during 2006-07, 39.35 crore during 2007-08, 63.35 crore during 2008-09, 86.44 crore during 2009-10, 78.75 crore during 2010-11, 46.6 crore during 2011-12 (as on 30.01.2013) and 32.61 crore during 2012-13 (as on 30.01.2013). 

•    Employment provided to the ST households (in person days) stood at 32.98 crore during 2006-07, 42.07 crore during 2007-08, 55.01 crore during 2008-09, 58.74 crore during 2009-10, 53.61 crore during 2010-11, 38.38 crore during 2011-12 (as on 30.01.2013) and 22.70 crore during 2012-13 (as on 30.01.2013). 

Employment to the Disabled

•    Total number of disabled beneficiaries under the MGNREGA stood at 1,46,401 during 2006-07, 3,36,698 during 2007-08, 2,04,772 during 2008-09, 2,97,215 during 2009-10, 2,94,490 during 2010-11, 3,85,203 during 2011-12 (provisional) and 3,02,536 during 2012-13 (as on 30.01.2013).

•    The Committee has been informed that Mihir Shah Committee constituted for revision in guidelines for implementation of MGNREGA works has suggested for creation of special condition to facilitate inclusion of disabled persons in MGNREGA works. However, the Committee found that as against 2.1 crore person with disabilities (census 2001) in the country only 19,67,315 have been provided work since inception of the Scheme. The Committee is unhappy to find that implementing agencies have failed to create proper environment for working of disabled persons in MGNREGA works.

Financial Management

•    Percentage of unspent amount (of total available funds) under the MGNREGA stood at 26.92% during 2006-07, 18.01% during 2007-08, 27.13% during 2008-09, 23.54% during 2009-10, 27.31% during 2010-11, 22.11% during 2011-12 (provisional) and 32.82% during 2012-13 (as on 30.01.2013). 

•    The Committee find that even though Rs. 2,63,182.70 crore were available for implementation of MGNREGA works from 2006-07 to 2012-13, implementing agencies could utilise Rs. 1,95,321.03 crore during these years. The Committee also noted that the trend of expenditure pattern has been uneven and huge unspent balance has been reported in each financial year. Examination by the Committee has revealed that huge unspent balances were lying with some big States such as Uttar Pradesh, Bihar, Madhya Pradesh, Rajasthan etc.

•    Expenditure on wages under MGNREGA stood at Rs. 5842.37 crore during 2006-07, Rs. 10738.47 crore during 2007-08, Rs. 18200.03 crore during 2008-09, Rs. 25579.32 crore during 2009-10, Rs. 25686.53 crore during 2010-11, Rs. 24860.91 crore during 2011-12 (provisional) and Rs. 15557.78 crore during 2012-13 (as on 30.01.2013). 

•    Expenditure on material under MGNREGA stood at Rs. 2758.77 crore during 2006-07, Rs. 4617.47 crore during 2007-08, Rs. 8100.89 crore during 2008-09, Rs. 11084.49 crore during 2009-10, Rs. 11891.09 crore during 2010-11, Rs. 11065.16 crore during 2011-12 (provisional) and Rs. 4279.28 crore during 2012-13 (as on 30.01.2013). 

•    Administrative expenditure as a percentage of available funds stood at 1.84% in 2006-07, 2.59% in 2007-08, 2.53% in 2008-09, 2.5% in 2009-10, 3.32% in 2010-11 and 9.13% in 2012-13.

Progress in work

•    Work completion rate (%) under the MGNREGA stood at 46.34% during 2006-07, 45.99% during 2007-08, 43.76% during 2008-09, 48.94% during 2009-10, 50.86% during 2010-11, 20.25% during 2011-12 (as on 30.01.2013) and 15.02% during 2012-13 (as on 30.01.2013). 

•    The Standing Committee found that implementing agencies were able to complete only 98.36 lakh works out of 296.13 lakh works undertaken during first seven years (as on 30.01.2012) of implementation of MGNREGA. The Committee’s examination has revealed that performance of smaller States such as Kerala, Manipur and Mizoram was better than the bigger States like Uttar Pradesh, Bihar, Tamil Nadu, Madhya Pradesh and Maharashtra.

•    The Committee noted that water related works constitute majority of works (54.58 percent) undertaken in MGNREGA, while work on private lands of SC/ST/BPL/SML and IAY and Land reform beneficiaries, Land development, rural connectivity and others (Bharat Nirman Kendra) constitute the 10.89%, 11.38%, 19.47% and 3.7% respectively. The Committee take note of the fact that MGNREGA works are being criticized for poor quality of assets created under it. The Committee's examination has revealed that expenditure limit of 40 percent imposed on material component including skilled and semi-skilled workers is restricting implementing agencies to undertake works requiring material components or skilled workers.

Delay in wage payment

•    The Committee noted that 8.67 crore Banks/Post Office accounts have been opened in the country to make payment of wages to the MGNREGA workers. However, the Committee noted that many problems like delay in fund transfer, insufficient cash limit of Post Offices, distance of Banks/Post Offices, single man working branch etc. have been noticed which causes delays in payment of wages. The Committee also noted that initiative such as appointment of banking correspondents is yet to become fully operational in majority of the States.

Unemployment allowance

•    The Committee is astonished to note that so far only 4078 workers were paid unemployment allowances in 8 States during 2006-09 and Rs. 1,23,589 has been paid to eligible beneficiaries in 2010-11 in six States. The Committee also noted that non-issuance of dated receipt of demanded work as pointed out by audit report of C&AG of India, prevents workers to claim unemployment allowance.

Transparency and Accountability

•    The Committee noted that 2,91,776 Social audits have been conducted during 2011-12 in 1,72,852 Panchayats out of 2,48,204 Gram Panchayats in the country. Also there is negligible participation of Gram Sabhas during social audits due to lack of awareness and failure of administration to ensure regular meetings of Gram Sabhas. The Committee also observed that performance of MGNREGA is better in those States which have a healthy tradition of social audit.

•    On the issue of formulation of Grievance Redressal Rules, the Committee found that only 8 States/UTs namely, Andaman & Nicobar islands, Haryana, Kerala, Meghalaya, Mizoram, Rajasthan, Sikkim and Uttar Pradesh have framed grievance redressal rules.

•    The Committee noted that the MoRD has proposed for appointment of ombudsman in each District for grievance redressal for the issues related to MGNREGA. The Committee also found that so far 263 Ombudsman have been appointed in 22 States.

Decentralised planning

•    The Committee expressed its astonishment to note that despite constitution of District Planning Committees (DPCs) in most of the States, PRIs have not been able to formulate District Perspective Plan, a necessary condition of effective utilization of funds available under MGNREGA. The Committee noted that most of the States are still following top down approach of planning for MGNREGA based upon labour budget. The Committee is of the considered view that formulation of District Perspective Planning (DPP) based upon active participation of Gram Sabhas is essential for effective utilization of resources.

•    The Committee noted that one of persistent complaints against MGNREGA scheme relates to less availability of labour during agriculture season. The Committee has been informed that only 47 days of employment were provided in the period for the year 2010-11 of which 12 days of employment were provided from July to November, 2010 which corresponds to the peak agriculture season. The remaining 35 days of employment were provided mostly in the lean agriculture season as supplementary employment.

•    The Committee is of considered view that lack of proper planning of works under MGNREGA without keeping in view of local agriculture practice is causing the problem of labour availability in agriculture sector. The problem could only be solved if there is follow up of guidelines about preparation of District Perspective Planning by District Planning Committees and annual planning by Gram Sabha clearly indicating works availability in a year while taking care of local agricultural practices.

•    So far, the States have been able to recruit only 2,12,586 dedicated personnel as against the target of 2,64,085 for implementation of MGNREGA upto the year 2010-11. The Committee find that absence of required administrative and technical staff results in delay of preparation of muster roll, estimation and evaluation of works etc. which ultimately affects generation of employment and delay in payment of wages to workers.

•    The Committee is concerned to note that targets for training programme for Elected Panchayat Representatives (EPRs) in many States are not being met. The Committee noted that, only 4,67,222 EPRs have been trained against the target for training of 6,37,484 during the year 2011-12. Similarly, targets for training for dedicated personnel under MGNREGA schemes have not been achieved.

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The first performance audit was undertaken by the CAG in 2007-08. The period of coverage of the first audit was February 2006 to March 2007. The present performance audit of the implementation of MGNREGA was taken up in response to a request from the Ministry of Rural Development and covers the period from April 2007 to March 2012. Implementation of the NREGS was checked in 3,848 gram panchayats in 28 states and 4 UTs. 

Key findings of [inside]Report of the Comptroller and Auditor General (CAG) of India on Performance Audit of Mahatma Gandhi National Rural Employment Guarantee Scheme[/inside], Report no.-6 of 2013-Union Government (Ministry of Rural Development), http://saiindia.gov.in/english/home/Our_Products/Audit_Report/Government_Wise/union_audit/recent_reports/union_performance/2013/Civil/Report_6/Report_6.html are as follows:

• Analysis of data related to the performance of the scheme showed that there has been significant decline in per rural household employment generation in the last two years. Per rural household employment, declined from 54 days in 2009-10 to 43 days in 2011-12. There was also a substantial decline in the proportion of works completed in 2011-12. Bihar, Maharashtra and Uttar Pradesh, which together account for 46 percent of the rural poor, utilized only about 20 percent of the central scheme funds. This indicated that the correlation between poverty levels and implementation of MGNREGA was not very high.

• As per section 16(3) of the Act, gram panchayats were required to prepare the annual development plan on the basis of recommendations of the gram sabha. In 1,201 GPs (31 percent of all test checked GPs) in 11 states and one UT, annual plans were either not prepared, or were prepared in an incomplete manner.

• In 14 states and one UT, 129.22 lakh works amounting to Rs. 1,26,961.11 crore were approved in the annual plans. But only 38.65 lakh works (30 percent of planned works) amounting to Rs. 27,792.13 crore were completed during the audit period, indicating significant inefficiencies in implementation of annual plans.

• In terms of MGNREGA, the states were to notify schemes and rules for its implementation. However, it was seen that despite passage of 7 years, after the Act came into force, state governments of Haryana, Maharashtra, Punjab, Rajasthan and Uttar Pradesh (5 states) did not formulate rules, as of March 2012.

• Audit observed that Information, Education and Communication (IEC) plans were not formulated in 12 states and 2 UTs. Shortfalls in utilization of IEC funds were also noticed.

• Governments of 4 states (Arunachal Pradesh, Kerala, Manipur and Tamil Nadu) had not appointed dedicated Gram Rozgar Sahayaks. Further, persistent and widespread shortages of Gram Rozgar Sahayaks as against the requirements were noticed in the case of nine states (Assam, Gujarat, Haryana, Himachal Pradesh, J&K, Madhya Pradesh Punjab, Uttar Pradesh and Uttarakhand). The shortages range from 20 to 93 percent.

• Job cards were not issued to 12,455 households in 6 states. Photographs on job cards represent an important control against fraud and misrepresentation. Photographs on 4.33 lakh job cards were not found pasted in 7 states. Non payment/ under payment of wages of Rs. 36.97 crore were noticed in 14 states. There were several cases of delayed payment of wages without payment of compensation.

• The Ministry relaxed all conditionalities and released a sum of Rs. 1960.45 crore in March 2011 to the states, contravening norms of financial accountability. An amount of Rs. 4,072.99 crore was released by the Ministry between 2008-12 to states for use in the subsequent financial year, in contravention of budgetary provisions and General Financial Rules. Also, excess funds of Rs. 2,374.86 crore were released by the Ministry to 6 states, either due to wrong calculation or without taking note of the balances available with the states.

• Schedule I of the Act prescribes that the material component of the work should not exceed 40 percent of the total work. In 12 states and one UT, cases of material cost exceeding the prescribed ratio were noticed. The material cost exceeded the prescribed level by Rs. 1594.37 crore in the test checked cases.

• In the test checked districts of 25 states/ UTs, 1,02,100 inadmissible works amounting to Rs. 2,252.43 crore were undertaken. These inadmissible works included construction of earthen/ kutcha roads, cement concrete roads, construction of raised platforms for cattle and other animals, construction of bathing ghats etc. Works amounting to Rs. 4,070.76 crore were incomplete despite passage of significant time, rendering the expenditure unfruitful.

• In 10 states and 4 UTs, Government had not constituted Social Audit Units to facilitate the social audit forums. In 11 states and one UT, it was seen that significant fewer social audits from prescribed norms were conducted.

• Monitoring at the Central level was unsatisfactory. The Central Council could not fulfill its statutory mandate of establishing a central evaluation and monitoring system even after 6 years of its existence. The only monitoring activity carried out was in the form of 13 ad hoc field visits to 6 states by the Council members. No follow up action was taken on these visits by the Council.

• Deficiencies, relating to both non-maintenance and incorrect maintenance of prescribed basic records, were noticed in 18 to 54 percent of the all test checked GPs, for various types of records. Widespread deficiencies in the maintenance of records restricted the process of proper verification of the outputs and outcomes of the scheme.

• There were substantial differences between the date uploaded in the MIS and actual records maintained/ information available with Directorate/ DPC. Apart from the erroneous entries made in the database, a number of cases were noticed where the states were not entering data on a regular basis. Hence, the MIS data on physical and financial performance of the scheme was not reliable. In addition, the MIS suffered from faulty programming logic and missing validation controls. Cases of data manipulation, without any reference to basic records and without any apparent basis, were also noticed.

 

 

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According to [inside]Mahatma Gandhi National Rural Employment Guaranty Act (MGNREGA) and Empowerment of Women in Rural Areas by Parliamentary Committee on Empowerment of Women (2011-12)[/inside], Fourteenth Report, Lok Sabha Secretariat, May, 2012, http://www.im4change.org/docs/692mgnrega_report.pdf

 

NREGS and Women Empowerment

 

Percentage share of employment availed by women under MGNREGS was 40% during 2006-07, 43% in 2007-08, 48% in 2008-09, 48% in 2009-10 and 48% in 2010-11. Hence, the percentage of women beneficiary under MGNREGA has been much higher than provided under the Act (i.e. 33% of total employment). 

Out of total 26.69 crore registered workers under MGNREGA for whom job cards have been issued so far, 11.62 crore (43.53%) are women. In 2010-2011, out of the total of 8.73 crore workers who requested for work, 3.92 crore (44.9%) were women.

A closer look at the state-wise women participation rate during 2010-11 gives an impression that in some states it has been either abysmally low or significantly high. While states like Kerala and Tamil Nadu register 90.39% and 82.59% women participation in MGNREGA, respectively, Uttar Pradesh shows just 21.42%, Assam 26.51% and Bihar 28.49%.

Main reasons for low participation of women in MGNREGA have been non-revision of Schedule of Rates**, socio-cultural constraints and low awareness. Some of the States including Uttar Pradesh, Rajasthan, and West Bengal have revised their SORs to make them work and gender sensitive

As per a study conducted by National Federation of Indian Women (NFIW), New Delhi, there is an emergence of women's identity and their empowerment with the coming of MGNREGA as an economic opportunity provider.

Due to MGNREGS, women have also started to appear more actively in the rural public sphere as they take up their work and responsibilities. There is a general trend of low migration in the areas where assessment was carried out and workers have started to repay their debts.

As per a study conducted in Bihar, Chhattisgarh, Jharkhand, Madhya Pradesh, Rajasthan, Uttar Pradesh, there was a substantial jump in earning potential for women. Out of total sample, 69% workers said MGNREGA helped them avoid hunger. MGNREGA also provided easy access to credit.

Ministry of Rural Development has not conducted any specific study on the issue of wages earned by women. However, the 64th Round survey by the National Sample Survey (NSSO) in 2007-08 had found that there was no difference between wages earned by men and women under MGNREGA as compared to other public works and that there was a reduced difference in the normal male-female wage rates for casual labour in rural areas vis-à-vis urban areas.

A Study titled as “Concurrent Evaluation of National Rural Employment Guarantee Scheme in the State of Uttarakhand” by IIT Roorkee, conducted in the districts of Udham Singh Nagar and Chamoli found that Women's participation in decision making process had increased after the introduction of MGNREGS, mainly due to their increasing wage earnings. The study further stated that participation of women is higher in the hill district of Chamoli than the plain district of Udham Singh Nagar. Apart from the lesser socio- economic constraints, non-availability of the male workers due to their significant migration to plains could be the basic reason for the larger participation of women under the Scheme.

A “Research study on changing gender relations through MGNREGS” in the States of Andhra Pradesh, Karnataka and Tamil Nadu done by NIRD Hyderabad found that MGNREGS acted as social security measure to the aged women, widows, divorced/deserted women. The study further stated that female dependency level has declined after the execution of MGNREGS.

A study of “NREGA process and practices in Andhra Pradesh and Madhya Pradesh: Appraisal cum research study”, by Centre for Educational Research & Development found that NREGA helps the women in general and lactating women in particular, to meet their basic needs, like food by ensuring regular income.

When asked about the performance of women mates, the Parliamentary Committee on Empowerment of Women (2011-12) have been informed that the district administration of Jalore in Rajasthan focused on training of women for deploying them as mates at worksites. This would ensure an increase in women persondays, participation and economic empowerment as well as better monitoring at worksites. The training was phase-wise and women were given calculators, bags, diaries, measurement kits, medicine kits. The model has now been adopted by the remaining districts of Rajasthan, districts in Uttarakhand, Manipur, Andhra Pradesh, Gujarat and Himachal Pradesh.

 

Employment, Wage Earnings and other findings

 

NREGS has provided employment opportunities to more than 5.49 crore households in 2010-11.

In financial year (FY) 2010-11, 50.99 lakh works were undertaken, of which 48% constituted water conservation, 18% rural connectivity, 14% land development, 0.33% constituted Rajiv Gandhi Sewa Kendra and provision of irrigation facility to individual beneficiaries constituted around 18% with remaining 2% works related to other activities.

Funding for MGNREGA which started with an initial outlay of Rs 11300 crore in year 2006–07 has considerably been increased over the years. In 2010-11, a total of Rs. 54172.14 crore including the Opening Balance was available for Mahatma Gandhi NREGA. During 2010-11, an amount of Rs. 35768.95 crore has been released to the states and Rs. 39377.27 crore has been utilized.

During the first year of implementation (FY 2006-07) in 200 districts, 2.10 crore households were provided employment and 90.5 crore person days were generated. In 2007-08, 3.39 crore households were provided employment and 143.59 crore person days were generated in 330 districts. In 2008-09, 4.51 crore households have been provided employment and 216.32 crore person days have been generated. In 2009-10, 5.26 crore households have been provided employment and 283.59 crore person days have been generated across the country.

During 2010-11, 257.15 crore person days employment has been generated across the country out of which 122.74 crore were women (47.75%). A total of 5.49 crore rural households have been provided employment during the period.

During 2010-11, the National Average person days per household have been 47 days.

At the national level, average wage paid under MGNREGA has increased from Rs. 65 in FY 2006-07 to Rs. 100 in FY 2010-11.

In order to ensure transparency and timely payment of wages to the workers, wage payment has been made mandatory through worker's account in Post Offices/Banks by making an amendment in para 31 of Schedule II of the Act vide Notification dated 19th February, 2008. As a result, 9.87 crore accounts of MGNREGA workers have been opened in banks and post offices. Due to lack of postal/ banking facilities in some of the remote areas, cases of delay in wage payment have been reported.

The Ministry of Finance has mandated that all villages with population of two thousand and above will have a Business Correspondent (BC) and this is being monitored by the Department of Financial Services and the Reserve Bank of India. 

According to Annual Report (2010-11) of the Ministry of Rural Development, states have reported that social audit has been conducted in 91% of the Gram Panchayats. 2.44 lakh reports on Social Audits have been uploaded on the Mahatma NREGA website indicating verification of 44323 lakh documents.

 

Positive Impacts of NREGS

 

A study conducted by the Indian Institute of Management, Shillong on the Implementation of MGNREGA in six districts has indicated that Mahatma Gandhi NREGA has sufficiently added to household income of the people who worked/ are working in Mahatma Gandhi NREGA. The workers were of opinion that they have been able to arrange their households' daily food requirements.

A study conducted by Indian Institute of Management, Ahmedabad has indicated that the earnings from Mahatma Gandhi NREGA are used as a supplementary income source during non-agricultural seasons.

A study conducted by the Institute of Human Development has noted that the earnings from Mahatma Gandhi NREGA has contributed 8 percent of the total income of the households in Bihar and about 2.41 percent of the total annual income of a household in Jharkhand. It has contributed more to the income of the SCs (11%), OBCs (9%), landless (9%) and marginal landholders (8%). In both the states (Bihar and Jharkhand) beneficiaries have spent a substantial part of their earnings on food and daily consumption items, health, social ceremonies and education of the children. Debt repayment has also been formed as a component of expenditure from NREGA earnings.

A study entitled, “Supporting the Operationalization of Mahatma Gandhi NREGA in Khasi Hill, Meghalaya”, by Martin Luther Christian University has noted increase in cash flow at the household level during the month of employment under the Mahatma Gandhi NREGA and the increase in the cash flow ranged from 13 to 32%.

A “Research study on changing gender relations through MGNREGS” in the states of Andhra Pradesh, Karnataka and Tamil Nadu done by NIRD Hyderabad stated that MGNREGS became primary source of income for one third of households. Household?s average income has increased significantly in all the three States, according to the study.

A study entitled as “NREGA process and practices in Andhra Pradesh and Madhya Pradesh: Appraisal cum research study”, by Centre for Educational Research & Development stated that beneficiaries of the Scheme in both the States reported that the Scheme increased their income by more than one fourth.

A study entitled as “Concurrent Evaluation of National Rural Employment Guarantee Scheme in the State of Uttarakhand” by IIT Roorkee, conducted in the districts of Udham Singh Nagar and Chamoli found that the employment in the post-MGNREGS period had increased between 12 and 18 percent in both the districts.

A study entitled, “Socio-Economic Impacts of Implementation of Mahatma Gandhi NREGA” by Council for Social Development in tribal areas of Chhattisgarh, Orissa, Jharkhand and Andhra Pradesh noted that the implementation of the Mahatma Gandhi NREGA has contributed in increasing the food security of the rural masses and a major portion of increased income earned through NREGA was spend on food consumption. The beneficiaries have been able to construct house on their own land due to additional income from Mahatma Gandhi NREGA work.

A study on “Impact Assessment of NREGA in Bankura and Purba-Medinipur Districts of West Bengal” by IIT Kharagpur found that villagers consider Mahatma Gandhi NREGA a boon for improving rural livelihood. The availability of works within the village is an encouraging factor, especially for women.

 

Note: ** The value of work done by a worker is estimated using the Schedule of Rates (SoR) prepared by State Governments. In States there are Schedule of Rates Committees entrusted with the task of preparing SoRs. Schedule of Rates are arrived at based on the All India Standard Schedule of Rates 1986 published by Ministry of Urban Development in association with National Building Organization. For commonly used completed items for which the standards are not available, standards are decided by the Chief Engineer. SoRs are revised yearly on the basis of inflation and calculation of cost of material/ labour at the market rate of material and labour. 

 

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According to [inside]MGNREGA Sameeksha: An Anthology of Research Studies on the MGNREGA 2006-2012[/inside], Ministry of Rural Development, http://www.im4change.org/docs/63503975mgnrega_sameeksha.pdf

Total number of households provided employment stood at 2.1 crore in financial year (FY) 2006-07, 3.4 crore in FY 2007-08, 4.5 crore in FY 2008-09, 5.3 crore in FY 2009-10, 5.5 crore in FY 2010-11 and 5 crore (provisional figure) in FY 2011-12.

Total person days of employment under MGNREGA stood at 90.5 crore in FY 2006-07, 143.59 crore in FY 2007-08, 216.3 crore in FY 2008-09, 283.6 crore in FY 2009-10, 257.2 crore in FY 2010-11 and 209.3 (provisional figure) crore in FY 2011-12.

Between financial years (FY) 2006-07 and 2011-12, Scheduled Castes (SCs) and Scheduled Tribes (STs) have accounted for 51 per cent of the total person-days generated and women for 47 per cent, well above the mandatory 33 per cent as required by the Act. 

Expenditure on NREGA stood at Rs. 8824 crore in FY 2006-07, Rs. 15857 crore in FY 2007-08, Rs. 27250 crore in FY 2008-09, Rs. 37905 crore in FY 2009-10, Rs. 39377 crore in FY 2010-11 and Rs. 37303 crore (provisional figure) in 2011-12.

Since its inception in 2006, around Rs 1,10,000 crore has gone directly as wage payment to rural households and 1200 crore person-days of employment has been generated. On an average, 5 crore households have been provided employment every year since 2008.

Eighty per cent of households are being paid directly through bank/post office accounts, and 10 crore new bank/post office accounts have been opened.

The average wage per person-day has gone up by 81 per cent since the Scheme’s inception, with state-level variations. The notified wage today varies from a minimum of Rs 122 in Bihar, Jharkhand to Rs 191 in Haryana.

Total number of works taken up under MGNREGA stood at 8.4 lakhs in FY 2006-07, 17.9 lakhs in FY 2007-08, 27.8 lakhs in FY 2008-09, 46.2 lakhs in FY 2009-10, 51 lakhs in FY 2010-11 and 73.6 lakhs (provisional figure) in FY 2011-12.

Total number of works completed under MGNREGA stood at 3.9 lakhs in FY 2006-07, 8.2 lakhs in FY 2007-08, 12.1 lakhs in FY 2008-09, 22.6 lakhs in FY 2009-10, 25.9 lakhs in FY 2010-11 and 14.3 lakhs (provisional figure) in FY 2011-12.

146 lakh works have been taken up since the beginning of the programme, of which about 60 per cent have been completed. Of these works,

- 19 per cent relate to rural connectivity (e.g. village roads)

- 25 per cent relate to water conservation and water harvesting

- 14 per cent relate to irrigation canals and renovation of traditional water bodies

- 13 per cent relate to flood protection and drought proofing

- 13 per cent relate to land development

- 14 per cent relate to work done on private lands (lands belonging to small and marginal farmers/SCs/ STs/Below Poverty Line (BPL) households/Indira Awas Yojana (IAY) and land reform beneficiaries) 

12 crore Job Cards (JCs) have been given and these along with the 9 crore muster rolls have been uploaded on the Management Information System (MIS), available for public scrutiny. Since 2010–11, all details with regard to the expenditure of the MGNREGA are available on the MIS in the public domain

 

According to [inside]Social Protection for a Changing India (May, 2011)[/inside], The World Bank, http://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2011/04/20/000333037_20110420235516/Rendered/PDF/612750v10ESW0P1rt0Volume0I01PUBLIC1.pdf:  

•    During 2009-10, Rs. 30100 crore was allocated under Mahatma Gandhi National Rural Employment Guarantee (MGNREG) Scheme. It covered 33 percent of rural households in 2008-09.

•    Administrative data and field studies suggest both significant successes in NREGS relative to previous public works programs (e.g., high coverage of rural households, with impressive inclusion of SC/ST and women workers) and many challenges in translating improved program design into outcomes for the poor, such as, matching demand for work with the administrative demands of opening worksites; aligning piece rate compensation with the minimum wage requirement; strengthening mechanisms for community participation in works identification and oversight.

•    The number of households to whom job cards were issued under NREGS went up from 38 million in 2006-07 to 65 million in 2007-08 and further to 100 million in 2008-09.

•    The number of households who demanded employment under NREGS went up from 21 million in 2006-07 to 34 million in 2007-08 and further to 45 million in 2008-09.

•    The percentage of rural households who were provided employment under NREGS has gone down from 39 percent in 2006-07 and 2007-08 to 33 percent in 2008-09.

•    The number of person days employment generated has gone up from 905 million in 2006-07 to 1437 million in 2007-08 and further to 2163 million in 2008-09.

•    The number of households who were provided 100 or more days of employment went up from 2 million in 2006-07 to 4 million in 2007-08 and further to 7 million in 2008-09.

 

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According to [inside]Progress in providing employment for the poor: The national public works programme in India (2010)[/inside] by Rebecca Holmes, Jenny Morgan and Jessica Hagen-Zanker, Overseas Development Institute, http://www.developmentprogress.org/sites/default/files/india_report_-_master.pdf:  

•    MGNREGA’s participatory approach is supported by a three-tiered system of governance called the Panchayati Raj system.

•    Registration for MGNREGA is undertaken at the lowest tier of local government – the gram panchayat – which means that more people have been able to access the service and register for job cards. Gram panchayats estimate the local demand for work, suggest suitable projects, issue job cards for new job seekers, monitor worksites and implement works. Payment for work is made through banks or post offices, which can be opened free of charge, which adds to the accessibility of MGNREGA.

•    Intermediary panchayats then ensure that job seekers are provided work within 15 days, and identify appropriate works if the gram panchayat fails to do so. Finally, district panchayats are required to develop five-year plans based on overall district needs and to coordinate MGNREGA activities at the district level.

•    Domestically financed, MGNREGA has scaled up rapidly, from 200 districts in 2006 to national coverage in 2008. It now reaches over 40 million households and has created over 1.7 billion person days of employment. MGNREGA is the only rights-based employment guarantee programme in the world, and it has stimulated the development of a range of similar initiatives in other countries in the South Asian region.

•    The budget allocated to MGNREGA has increased as the programme has expanded nationally. In the first fiscal year of the Act, 2006/07, expenditure was $1.76 billion. In 2009/10, $6 billion was allocated. This amounts to around 0.5% of GDP, 3.3% of budget expenditure and 10% of planned expenditure.

•    In 2009/10, over 43 million rural households in India demanded work. Of these, 99% were provided with work.

•    During 2009/10 in Rajasthan, over 344 million person days have been created, in Uttar Pradesh over 248 million and in Tamil Nadu over 222 million.

•    In 2009/10, a national average of only 7% of households employed under MGNREGA completed 100 days of work. Rajasthan, Uttar Pradesh and Tamil Nadu were more successful than other states in this regard, providing the full 100 days to 12%, over 14% and 7% of households, respectively.

•    SCs and STs represent 14% and 8% of the population in India, respectively, but their representation in MGNREGA is almost 20%. MGNREGA also prioritises works on irrigation facilities on land owned by households belonging to SCs/STs or on land of the beneficiaries of land reform. In 2008/09, 20% of MGNREGA works supported the provision of irrigation facilities on land owned by SCs/STs, compared with 10% in 2006/07 and 15% in 2008/09, suggesting that this focus is an increasing priority.

•    Specific provisions to support women’s participation in MGNREGA include priority to work on sites close to home (within 5km) and provision of childcare facilities. Overall, women represented 48% of participants in 2008/09 and 46% of participants in 2009/10.

•    In Rajasthan and Tamil Nadu, the proportions of women receiving days under MGNREGA were much higher than the national average, at 64% and 78%, respectively, whereas in Uttar Pradesh it was much lower, at only 14%.

•    Many factors influence the number of women employed in MGNREGA, including existing cultural and social norms, wage rates and the provision and quality of child care facilities.

•    In some states, cultural norms prevent women from working outside the home or working with men, reflected in household decisions to send only men for MGNREGA work, thereby denying women’s rights to access employment days (Samarthan Centre for Development Support, 2007). Entrenched ideas about the gender division of labour also affect the type of work seen as acceptable for women to do.

•    Studies also show that, even when women want to work, the panchayat may have excluded them because of social norms around the ‘appropriate’ type of work for women (Khera and Nayak, 2009). In Madhya Pradesh, for example, although women’s representation overall is above 40%, in practice women receive fewer days on MGNREGA because they are not involved in all types of work available. Women are often given ‘soft’ work such as throwing out the soil from digging wells, which requires fewer days.

•    Evidence from Andhra Pradesh demonstrates that MGNREGA can reduce vulnerability to external shocks, in particular weather-related shocks, which affect agricultural productivity in India, by smoothing income and consumption.

•    Johnson (2009) finds that MGNREGA participation in the lean season responds to weather-related shocks in the wet season, with more households participating in MGNREGA (although not necessarily for more days). The study also finds that participation levels in MGNREGA are more responsive to weather-induced shocks than other government welfare programmes.

•    Another important benefit of MGNREGA in reducing vulnerability has been an increase in household wage income. Average household wage income increased from Rs. 2,795 in 2006/07 to Rs. 4,060 in 2008/09.

•    Drèze and Khera (2009) find that MGNREGA also supports household health. A survey of six states in northern India found that the majority (57%) of the sample workers had used a part of their wages to buy medicine or treat an illness in the family. In Andhra Pradesh, 13% of household earnings from MGNREA are spent on health security (Kareemulla et al., 2009).

•    The increase in the average wage has also supported rural purchasing power and boosted overall spending, particularly in the face of drought and higher food prices. Mahambare (2010) finds that MGNREGA-generated consumption expenditure amounted to nearly 1.4% of total rural consumption and nearly 1% of total household consumption in India in 2010, nearly doubling its share since 2007/08. Dev (2009) argues that employment on MGNREGA also helped cushion the impact of the recent food price crisis. Although food prices in India did not rise as sharply as in other countries, because of India’s food management policies, they were slightly higher than normal. MGNREGA resulted in higher purchasing power and generated demand for food in rural areas.

•    Evidence from a study carried out in 2008 by the Centre for Science and the Environment (2008) suggests that assets and infrastructure have reduced vulnerability to food insecurity and improved livelihood opportunities. In Nuapada district in Orissa, where people are highly dependent on forest land, 43% of the community felt that the availability of fuel wood and/or fodder had increased as a result of MGNREGA works. A total of 15% of respondents had also diversified their crop mix from paddy and biri to produce groundnut, millet and vegetables, and 15% of the population reported that MGNREGA had led to increased water availability.

•    The same study found that, in Sidhi, in Madhya Pradesh, MGNREGA works had reduced the population’s dependence on the forest by providing alternative livelihood options. MGNREGA works have also improved access to better irrigation facilities, which has impacted positively on agriculture in the area. MGNREGA has been responsible for the construction of ponds, tanks and wells on SC and ST land. Respondents also reported crop diversification into vegetables. A total of 78.6% of respondents felt that MGNREGA works had led to increased water availability.

•    Similar results were found by a 2007 study by the Samarthan Centre for Development Support (2007) in Uttar Pradesh, where 30% of respondents highlighted increased food security and improved diets, particularly for children, as a result of MGNREGA employment.

•    Kareemulla et al. (2009) found that, in Andhra Pradesh, 18% of household earnings from MGNREGA is spent on education. Similarly, the Samarthan Centre for Development Support (2007) found that households use MGNREGA wages to increase access to and improve quality of children’s education, by paying admission fees, purchasing books, providing tuition and buying school uniforms. In Uttar Pradesh, improved road connectivity has enabled children to attend school more regularly by bicycle or on foot.

•    Uppal (2009) found that child labour decreases with parents’ registration and participation in MGNREGA. Meanwhile, child health as measured by anthropometric measures improves when parents register and work for MGNREGA.

•    In Gujarat, Madhya Pradesh and Jharkhand, it was found that the bribe that local officials demand for an application form for a job card may range from Rs. 5 to Rs. 50, where a day labourer may earn only Rs. 60 or so.

•    The demand-led nature of the programme also entails complicated calculations, as the number of households that will apply for MGNREGA and therefore the amount of work to be allocated cannot be guaranteed. In Madhya Pradesh, Holmes et al. (2010) found that, in practice, MGNREGA was supply- rather than demand driven, with panchayats allocating work to households rather than households applying for it when needed.

•    Limited staff capacity and skills in implementing MNGREGA result in serious deficits in effectively delivering employment for the rural poor. Ambasta et al. (2008) suggest that MGNREGA is constrained by a lack of professionals, in particular programme officers, who were to be appointed at state level to support implementation, and accredited engineers, also to be appointed at state level to support timely and transparent costing of works to be undertaken. In many cases, the capacity of the panchayats is lagging. As one interviewee stated: ‘the panchayats are the weakest link in the roll out of NREGA’ (Holmes et al., 2010). In addition, Drèze (2009) reports routine violations of the entitlements of MGNREGA workers, ‘whether it is their entitlement to work on demand, or to minimum wages, or to payment within 15 days, or to basic worksite facilities.’

•    There is limited civil society activity in some states. A survey undertaken by Drèze and Khera in 2009 reported still very low awareness levels among MGNREGA workers of their rights, including employment on demand; minimum wages; payment within 15 days; and basic worksite facilities. This is linked to low levels of civil society intervention.

•    During the 1990s, India faced the lowest growth rate of rural employment since independence, with annual growth of rural employment falling from 2.03% to 0.67% over the period 1993/94 to 1999/00, directly attributed to the stagnation of agricultural employment (Pal and Ghosh, 2007).

•    According to National Sample Survey (NSS) data, there was a very large increase in landless households as a percentage of total rural households, from around 35% in 1987/88 to as much as 41% in 1999/00.

•    As growth has accelerated in India over the past few decades, poverty has declined. In the 1970s and 1980s, poverty rates fell rapidly, in large part because of the agricultural ‘green revolution’ in the 1970s. Poverty declined from 64% in 1967 to 50% in 1977 and to 34% in 1986.

•    In 2004/05, the number of people still living in poverty was 28% and, because of population growth, the absolute number of poor people has declined only marginally, from 320 million in 1993/94 to 302 million in 2004/05.

•    In April 2010, the Planning Commission of India (PCI) accepted a new methodology for estimating poverty, which pushed the proportion of people living below the revised poverty line to 37.2%.

•    Poverty rates remain highly concentrated in rural areas in absolute numbers, because 75% of the population lives in rural areas. Poverty is also highly correlated with particular social and ethnic groups. Owing to the hierarchical and unequal nature of the caste system, Scheduled Castes (SCs), Scheduled Tribes (STs) and Other Backward Castes (OBCs) are denied access and entitlements to economic, civil, cultural and political rights. Data from 2000 show that the poverty headcount in rural areas was highest among SCs and STs (45.8% and 35.9%, respectively) compared with 21% among non-SCs/STs.

•    The rural poor remain highly reliant on agricultural day labour work. The proportion of casual workers increased from 65% in 1972 to 80% in 2002 among male wage earners, and from 89% to 92% among female wage earners.

•    In terms of numbers, India has 82 million landless rural households dependent on agricultural wage employment, as well as 80 million marginal farmers with low asset positions, who turn to off-farm work for survival.

•    According to the United Nations Development Programme (UNDP, 2009), 41.6% of India’s population is living in poverty according to the $1.25 poverty line. However, the national poverty line puts the number at a lower 28.6% of the population (over 300 million people).

 

 

According to the Annual Report 2009-2010 of the Ministry of Rural Development, http://rural.nic.in/annualrep0910/anualreport0910_eng.pdf:

• In 2009-2010, upto December 2009, an amount of Rs. 18950 crore has been utilized out of Rs. 39,100 crore, during the same period 160 crore persondays employment has been generated across the country. At the national level, average wage paid under MGNREGA has increased from Rs.65 (FY 2006-07) to Rs. 88.48 in FY 2009-10. In FY 2009-10, 36.51 lakhs works were undertaken, of which 51% constituted water conservation, 16% rural connectivity, 14% land development and provision of irrigation facility to individual beneficiaries constituted around 17%.

• During the first year of implementation (FY 2006-07) in 200 districts, 2.10 crore households were employed and 90.5 crore persondays were generated. In 2007-08, 3.39 crore households were provided employment and 143.59 crore persondays were generated in 330 districts. In 2008-09, 4.51 crore households have been provided employment and 216.32 crore persondays have been generated across the country.

• At the national level, average wage paid under MGNREGA has increased from Rs.65 (FY 2006-07) to Rs. 88.48 in FY 2009-10. This has led to a strengthening of the livelihood resource base of the rural poor in India. In 2008-09, 67% of funds utilized (Rs.18200.03 crore as wage expenditure) were in the form of wages paid to the labourers. In 2009-10, 69% of the funds have been utilized in the form of wages (Rs.18806.39 crore as wage expenditure)

• The Programme had a high workforce participation of marginalized groups like SC/ ST (54%) in FY 2008-09. Women workforce participation has also surpassed the statutory minimum requirement of one third participation. In 2008-09, women participation was 48% which has increased to 49% in FY 2009-10.

• Payment of wages through banks and post offices has been statutory. In the current financial year 2009-10, so far 8.57 crore bank and post offices accounts have been opened to disburse wages.

• MGNREGA workers have been identified as a category for Jana Shree Bima Yojana of LIC for insurance cover. Efforts are also on to extend the benefits of Rashtriya Swasthya Bima Yojana to MGNREGA workers.

• In FY 2008-09, 27.75 lakhs works were undertaken with 46% water conservation works. Similarly, in FY 2009-10, 36.51 lakhs works were undertaken, of which 51% constituted water conservation, 16% rural connectivity, 14% land development and provision of irrigation facility to individual beneficiaries constituted around 17% with remaining 2% works related to other activities. Out of 36.51 lakh works undertaken, 13.75 lakhs works have already been completed.

 

According to the Highlights of Quarterly Progress Report on National Rural Employment Guarantee Act (NREGA), Rural Development Ministry, 15 September, 2009, http://www.pib.nic.in/release/release.asp?relid=52639, http://www.pib.nic.in/release/release.asp?relid=52648


1. Evolving the design of the wage employment programs to more effectively fight poverty, the Central Government formulated the National Rural Employment Guarantee Act (NREGA) in 2005. 

2. New initiatives: To continue focus on critical issues and priority areas highlighted by the President to strengthen NREGA, the Ministry has held high level workshops and extensive consultations.  The action taken by the Ministry is as follows:      

• District Level Ombudsman: Instructions on Ombudsman have been issued. The Ombudsman will be appointed by the State Government on the recommendation of the selection committee. Ombudsmen will be well-known persons from civil society.  The Ombudsman will receive complaints from NREGA workers and others on any matters, consider such complaints and facilitate their disposal in accordance with law. 

• NREGA partnership with Unique Identification Development Authority of India (UIDA): NREGA partnership with UIDA has been initiated. 

• Social Audits: Social Audit is an important tool by which the people can improve and devise strategies to enhance the quality of implementation of NREGA. The Act was amended to provide for procedures on conducting social audits. 

• Independent Monitoring Mechanisms: 100 eminent citizens will be identified to further report on the progress of NREGA. 

• Convergence: The Ministry of Rural Development has developed and disseminated guidelines for convergence of NREGS with different Schemes and specific programmes. 115 pilot districts in 23 states have been identified for convergence. 

• Enlarge the scope of works permitted under NREGA presently limited to unskilled manual labour:  The Act has been amended to include provision of irrigation facility, horticulture plantation and land development facilities to land owned by households of the small farmers or marginal farmers.

• NREGA has the potential to diminish the adverse impact of drought by placing purchasing power in the hands of the people. Advisories were issued to all 11 drought affected states to ensure that adequate funds and shelf of project have been made available to the Districts.

• 115 pilot districts in 23 states have been identified for convergence among various rural development programs of the ministry. He also informed that the scope of works permissible under NREGA has been enlarged to include the provision of irrigation facility, horticulture plantation and land development facilities to land owned small or marginal farmers. Efforts have been made to protect the non negotiable instruments in the act. Gram Panchayats have been asked to ensure that works on lands of SC / ST and BPL receive first priority. Provision of Ombudsman at district level, setting up of Eminent Citizen’s Panel along with the reports from the National monitors will play a a major role in the monitoring of implementation of the Act.

• Efforts are on to upgrade the capacity of NIRD for better training in rural development and governance reforms are being undertaken to upscale the capacity of CAPART. NIRD and CAPART have been assigned the responsibility to prepare training modules for flagship programs.

According to Chakraborty, Pinaki (2007): Implementation of the National Rural Employment Guarantee Act in India: Spatial Dimensions and Fiscal Implications, Bard College, http://papers.ssrn.com/sol3/papers.cfm

 
  • The National Rural Employment Guarantee Act (NREGA) was enacted by the Indian Parliament in 2005 to provide a minimum guaranteed wage employment of one hundred days in every fiscal year to rural households with unemployed adult members prepared to do unskilled manual work.
 
  • In the past, public employment programs in India targeted at the poor were generally identified with the poverty alleviation. NREGA goes beyond poverty alleviation and recognizes employment as a legal right. The only example of guaranteed state-sponsored employment in India is the Maharashtra Employment Guarantee Scheme, which was enacted and implemented under the extraordinary circumstances of severe drought in the state during 1970 to 1973 as innovative anti-poverty intervention.
 
  • NREGA goes beyond poverty reduction and recognizes employment as a legal right. Skeptics considered it as a populist measure while others have considered it as a landmark initiative towards poverty alleviation and empowerment of poor.
 
  • During the 1980s and 1990s, one would observe that during the tenth Five Year Plan, the growth rate of employment has slowed down considerably.  The annual rate of growth of rural employment was around 0.5 percent per annum between 1993–94 and 1999–2000, as compared to 1.7 percent per annum between 1983 and 1993–94 and also the current daily status unemployment rate in rural areas increased from 5.63 percent in 1993–94 to 7.21 percent in 1999–2000.
 
  • The deceleration in employment growth was further reinforced by a sharp cut back in public spending on rural employment programs (Dev 2002). In this context, the enactment of NREGA is appropriate and timely. Although, the aggregate employment figure shows a decline, national sample survey estimates of unemployment rates in 1999–2000 showed that the rate of unemployment in “usually unemployed” category in 1999–2000 was only 2 percent for the male labor force and less than 2 percent for the female labor force.
 
  • Despite low unemployment rates, the incidence of income poverty in rural areas is at least four times the incidence of unemployment as per the current daily status, which implies that the number of poor far outweighs the number of poor for want of work
 

Provisions of NREGA

The various provisions of the NREGA are the following: (i) it provides at least one hundred days of guaranteed wage employment in every fiscal year for at least one adult member of every household prepared to do unskilled manual labor at the wage rate specified by the state government; (ii) creation of durable assets and strengthening the livelihood resource base of the rural poor shall be an important objective of the scheme. The state council shall prepare a list of permissible works, as well as a list of “preferred works”; (iii) the program may also provide, as far as possible, for the training and upgradation of the skills of unskilled laborers; (iv) wages may be paid in cash, in kind, or both, provided that at least one-fourth of the wages shall be paid in cash only; (v) employment shall be provided within a radius of five kilometers of the village where the applicant resides at the time of applying. In cases where employment is provided outside such radius, it must be provided within the block, and the laborers shall be paid 10 percent of the wage rate as extra wages to meet additional transport and living expenses; (vi) in case the number of children below the age of six years accompanying the women working at any site is five or more, provisions shall be made to depute one women worker to look after such children. The person deputed for this shall be paid the statutory minimum wage; and (vii) a proportion of the wages, not exceeding 5 percent, may be deducted as a contribution to welfare schemes organized for the benefit of laborers employed under the program, such as health insurance, accident insurance, survivor benefits, maternity benefits, and social security schemes

 

 

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The Performance Audit of the implementation of NREGA by the Comptroller and Auditor General of India, cag.gov.in/html/reports/civil/2008_PA11_nregacivil/Exe-sum.pdf show:

 

• A Performance Audit of the implementation of NREGA in the initially notified 200 districts was taken up during May–September 2007, in response to a request from the Ministry of Rural Development, so as to provide assurance that the processes under the Act were put in place and were being adopted effectively by the State Governments.

• Of the total available funds of Rs. 12074 crore (including the States’ share of Rs 813 crore) upto March 2007, the State Governments could utilize Rs. 8823 crore (73 per cent)

• According to the Ministry of Rural Development’s figures, 3.81 crore households had registered under the Act, Out of these, while, 2.12 crore households had demanded employment, 2.10 crore households were provided employment during 2006-07.

• The applications for work are to be submitted primarily at the Gram Panchayat, and it was crucial to maintain proper records of employment demanded, employment provided, number of days of employment generated, entitlement for employment allowance etc. However, the examination of field-level records by Audit reveled that record maintenance, particularly at GP level was poor, demonstrating the lack reliability and authenticity of the reported figures. Also, as the applications for demand for work were not documented or dated, and dated receipts for such applications were not issued in most cases, the eligibility of rural households for unemployment allowance, in these cases, was unverifiable. This would indicate that there is a high probability of only partial capturing of the demand for work.

• There were several cases of delayed payment of wages, for which no compensation was paid. While there was a high probability that all demands for work were not being captured, there were also instances of non-payment of unemployment allowance, which became due to employment seekers even where the records indicated that demand was not provided within 15 days from date of demand. Yet no one was fined for the violation of the Act. This indicates lack of an effective grievance redressal mechanism which defeated the very purpose of the Act of conferring a statutory right on the rural households for demanding upto 100 days of employment.

• The poor record maintenance further diluted the purpose of the Act as in the absence of dated acknowledgement of the application for work, there was no way the employment seekers could prove denial of demanded work and could claim entitlement for unemployment allowance.

• Systems for financial management and tracking were deficient, as monthly squaring and reconciliation of accounts at different levels to maintain financial accountability and transparency was not being done. The status of inspection of works, and holding of Gram Sabhas to conduct Social Audit Forum was also not up to the mark.

• Subsequent to the original audit, some of the sampled districts were revisited to check the improvement in maintenance of records in February-March 2008, covering 24 GPs in 12 blocks in 12 districts in 6 States from within the original audit sample. The scrutiny revealed that while there was a definite improvement in record maintenance especially in Uttar Pradesh after the conduct of initial audit, the maintenance of basic records at the GP level, in particular the employment register was still deficient and there was considerable scope for improvement.

 

Funding of NREGA

 

 

funding of nrega

 

 

Present status

According to the [inside]Comptroller and Auditor General’s Performance Audit Report No. 11 of 2008[/inside],
cag.gov.in/html/reports/civil/2008_PA11_nregacivil/introduction.pdf

• The Governments of Arunachal Pradesh, Chhattisgarh, Gujarat, Haryana, Himachal Pradesh, Jammu & Kashmir, Jharkhand, Kerala, Maharashtra, Manipur, Punjab, Rajasthan and Tamil Nadu (13 States) did not formulate rules for carrying out the provisions of the Act as of March 2007

• The Governments of Arunachal Pradesh, Andhra Pradesh, Assam,  Chhattisgarh, Gujarat, Jharkhand, Karnataka, Kerala, Madhya Pradesh, Manipur,  Nagaland, Orissa, Punjab, Sikkim, Uttarakhand and West Bengal (16 States) did not prescribe the time frame for each level i.e. GP, Block and District levels for proposing, scrutinising and approving REGS works

• While 18 State Governments had designated an officer as State Rural Employment Guarantee Commissioner, the State Governments of Arunachal Pradesh, Himachal Pradesh, Karnataka, Nagaland, Tripura, Uttar Pradesh  and Uttarakhand (7 States) had not done so as of March 2007

• The Governments of  Arunachal Pradesh, Assam, Bihar, Haryana, Himachal Pradesh, Jammu & Kashmir, Jharkhand, Karnataka, Madhya Pradesh, Maharashtra, Meghalaya, Nagaland, Orissa, Punjab, Sikkim, Tamil Nadu, Tripura, Uttar Pradesh, Uttarakhand  and  West Bengal (20 States) did not appoint full-time dedicated Programme Officers (POs) in 102 test checked blocks. The existing Block Development Offices (BDOs) were appointed as POs and given the additional charge of the Scheme

• Out of 68 districts test checked, District Perspective Plans (DPPs) were not prepared by 40 districts in Assam, Bihar, Chhattisgarh, Gujarat, Haryana, Himachal Pradesh, Jharkhand, Karnataka, Kerala, Maharashtra, Manipur, Punjab, Tamil Nadu, Tripura, Uttar Pradesh, Uttarakhand and West Bengal (17 States)

• Door-to-door survey to identify persons willing to register was not conducted in 323 Gram Panchayats in Andhra Pradesh, Assam, Bihar, Chhattisgarh, Haryana, Himachal Pradesh, Jammu & Kashmir, Jharkhand, Karnataka, Kerala, Maharashtra, Manipur, Nagaland, Orissa, Punjab, Rajasthan, Tamil Nadu, Uttar Pradesh, Uttarakhand and West Bengal (20 States)

• Delays in issue of job cards were noticed in 196 Gram Panchayats in Andhra Pradesh, Assam, Bihar, Chhattisgarh, Haryana, Himachal Pradesh, Jharkhand, Kerala, Maharashtra, Manipur, Orissa, Sikkim, Tamil Nadu, Uttar Pradesh, Uttarakhand and West Bengal (16 States)

• Photographs of the applicants were not attached to job cards in 251 Gram Panchayatss in Andhra Pradesh, Assam, Bihar, Chhattisgarh, Haryana, Himachal Pradesh, Jharkhand, Madhya Pradesh, Maharashtra, Orissa, Uttar Pradesh, Uttarakhand and West Bengal (13 States)

• In 19 districts in Bihar, Chhattisgarh, Haryana, Himachal Pradesh, Jharkhand, Orissa and Uttar Pradesh (7 States), the wages-material ratio of 60:40 was not maintained at the district level

• The Governments of Arunachal Pradesh, Assam, Bihar, Chhattisgarh, Haryana, Himachal Pradesh, Jharkhand, Karnataka, Kerala, Manipur, Meghalaya, Punjab, Sikkim, Tripura, Uttar Pradesh, and Uttarakhand (16 States) did not prepare separate District-wise Schedules of Rates (DSRs) specifically for NREGA works

• In 79 Gram Panchayats in Andhra Pradesh, Bihar, Chhattisgarh, Jharkhand, Kerala, Madhya Pradesh, Maharashtra, Manipur, Orissa, Punjab, Rajasthan and Tamil Nadu (12 States), the workers, even after working for seven hours, were paid wages less than the minimum wage rate

• In 213 Gram Panchayats in Andhra Pradesh, Bihar, Chhattisgarh, Haryana, Himachal Pradesh,  Jharkhand, Karnataka, Kerala, Madhya Pradesh, Manipur,  Orissa,  Rajasthan, Sikkim, Tamil Nadu, Uttar Pradesh, Uttarakhand  and West Bengal (17 States), workers were not paid wages on time i.e. within a fortnight of the date on which the work was done. No compensation was paid to them

• Audit scrutiny in 58 blocks in Arunachal Pradesh, Bihar, Chhattisgarh, Himachal Pradesh, Jharkhand, Karnataka, Kerala, Manipur, Meghalaya, Nagaland, Orissa, Punjab, Rajasthan, Sikkim, Tripura, Uttar Pradesh and Uttarakhand  (17 States) revealed that unemployment allowance was not paid to those workers, who could not be provided with employment within 15 days from the date on which work was requested for

• In 246 Gram Panchayats in Assam, Bihar, Haryana, Himachal Pradesh, Jharkhand, Karnataka, Kerala, Manipur, Nagaland, Orissa, Punjab, Uttar Pradesh, Uttarakhand and West Bengal (15 States), copies of muster rolls were not available for public scrutiny in the Gram Panchayats

 

According to the Centre for Science and Environment, www.cseindia.org,

 

• Governments have failed to articulate the Act’s development potential. Instead of implementing and evaluating the Act purely in terms of employment creation, the focus should have been on the real impacts on local development through productive assets creation

• Irrational wage calculations have made projects like water conservation less lucrative

• Out of a total of 769,582 works under progress, only 158,277 (20.56 per cent) have been completed. Till August 2007, only about 14 per cent of water conservation works under NREGA had been completed.

• In fact, road construction projects were getting done at a faster rate

• Bad planning for water conservation structures is putting a large number of the assets created into disuse. For instance, water-harvesting structures have been created without any provision for catchment protection. On top of this, ‘maintenance work’ does not come under the ambit of NREGA as a permissible activity. As a result, districts, which already have large numbers of water harvesting structures and want to use NREGA money for their maintenance, can’t do so

The study titled “Evaluating Performance of national Rural Employment Guarantee Act”, which has been done by Public Interest Foundation (PIF) and National Council of Applied Economic Research (NCAER) show,

http://www.publicinterestfoundation.com/index.php?option=com_content&task=view&id=47&Itemid=49

http://www.hindustantimes.com/StoryPage/StoryPage.aspx?sectionName=NLetter&id=afbf7ea0-234e-4572-ba5c-5404e635d3b7&Headline=Shady+data%2c+sloppy+work%3a+study+slams+NREGA

  • There has been data manipulation that falsely portrays a healthy picture of employment generated through the scheme.
 
  • Provision of employment to 10 per cent households in the official data is also doubtful because independent surveys, social audits, and field studies have revealed several cases of data manipulations which explains why national and state level data on employment against demand shows a rather healthy demand
 
  • There were a large number of districts in many states, where the number of households that have been issued job cards is more than the total number of households in these districts

 

The study has made the following recommendations:

Responsibility of Government of India to provide funds through an easy and convenient mechanism

  • In the present funding pattern GOI provides funds to the states to meet full cost of wages and upto 75% of the material cost of work including wages to skilled and semiskilled workers. (subject to material-wage ratio not exceeding 40:60); release of funds is made not to the state but directly to each district. This system involves need for detailed calculations and scrutiny of figures of expenditure on wages, material component and staff. It also entails heavy workload in having to keep district-wise accounts. This cumbersome procedure compels district officers to make frequent visits to Delhi to chase their proposals for release of funds.
  • The whole process can be greatly simplified by having a new funding pattern in which central government meets full cost of employment wages and in addition funds equal to 50% of wages are given towards all other costs (including material component, staff etc). This simple pattern of funding would dispense the need for getting from states details of expenditure on material, staff etc. or having to calculate the wage-material ratio in REGS works. Also, the release of funds should be to the state and not directly to the district; on-account automatic release of funds to the states will be based on the Utilization Certificate of earlier released funds given by the finance department of the state.  GOI will then be concerned with maintaining only state-wise accounts and not nearly 600 accounts for the districts.
  • The above on-account automatic fund release mechanism should be backed by an efficient system of timely post-release checking of accounts of the states by the Inspection team deputed by the Centre. REGS should also provide for half-yearly audit of accounts by the State Audit and annual audit by C & AG

 

According to the [inside]Digging holes and filling them in again? How far do public works enhance livelihoods?[/inside] by Anna McCord and John Farrington,

http://www.odi.org.uk/resources/download/2571.pdf

Problems with the implementation of NREGA

  • Low utilisation of available funds: central government provides 90% of the funding for NREGA, but on average, the States used 71.5% of funds in FY 2006/7, with some under 50%
  • Low and intermittent provision of work: a national average of 43 employment days per benefited family in 2006/7; failure to meet the target of one-third women beneficiaries in 11 of 27 States; intermittent provision of work, often clashing with main agricultural activities.
  • Implementation difficulties, including absence of social audits and inadequate focus of public works on priority areas such as water conservation, drought proofing and plantations; non-implementation of workplace facilities and unemployment benefit
  • Low awareness of the Act’s provisions among intended beneficiaries, beyond the “100 days of work” provision
  • Misappropriation of funds in the process of issuing job cards and registering workers on specific jobs; diversion of funds to unauthorised works

Long term public works in India – the National Rural Employment Guarantee Act (NREGA):

Main features

  • The basic objectives of NREGA, passed in September 2005, are essentially long-term, namely to enhance livelihood security in rural areas; as well as creating productive assets, protecting the environment, empowering rural women and fostering social equity.
  • Its budget in FY 2006-07 was Rs113bn, rising to Rs. 120bn for 2007-08 (approximately US$3bn, equivalent to some 0.4% of GDP). It is intended ultimately to benefit some 54 million of the poorest rural workers, initially in 200 poor districts (expanded to 330 districts – approximately two-thirds of the districts in the country – from April 2007).

The Act builds on earlier experience with Employment Guarantee in Maharashtra. Apart from affirming the ‘right to work’, it also seeks to ensure that the poor have a voice in decisions on the works to be undertaken, so that such works contribute to their livelihoods. The core features of the Act are:

  • Registration by unskilled workers with local government for a job card which is valid for at least five years.
  • The provision of not less than 100 days of local (i.e. within a 5 km radius) wage employment per registered household, on demand, in a financial year.
  • At least one-third of the wage seekers to be women.
  • Payment of the statutory minimum agricultural wage, with equal wages paid to men and women.
  • Contractors and labour displacing machinery not to be engaged. Only works approved by local government to be taken up.
  • Provision of unemployment allowance if an applicant is not provided with work within fifteen days of receipt of his/her application for employment.
  • Provision of work site facilities such as safe drinking water, child care, shelter and first aid. In case of accidental injury while working, the injured person is entitled to medical treatment free of charge.

**page**

 

 

Best Practices on Financial Inclusion in NREGA

Source: Chapter 1: NREG Scheme, page 10, Annual Report 2007-08, Ministry of Rural Development, Government of India 

Gulbarga District – Karnataka

The district has a population of 31.30 lakhs. There are 337 gram panchayts and 1363 villages. The total number of households is 3.89 lakhs out of which 2.15 lakhs households have been issued Job Cards under NREGA. 3000 works have been taken up during the current year (2007-08) as against 3259 works taken up last year (2006-07). In total, Rs. 19.05 crores have been spent under NREGA during the current financial year as against Rs. 34.02 crores spent last year. Till now, 62,313 accounts in post offices, 157,687 in commercial banks and 17,946 accounts in Co-operative banks have been opened. Almost 90 villages have banks and 752 villages have banks within 5 Km (51.17%), whereas 345 villages have banks within 5-19 Km (25.97%).

East Godawari District-Andhra Pradesh

The State Department of Rural Development and Department of Posts, A.P. Circle have entered into MoU for payment of wages through Post Office Saving Account. 4,17,154 postal saving accounts have been opened against 3.5 lakh persons reporting for NREGS works. Fortnightly, co-ordination meetings are conducted between district administration and representative of department of posts at district level and block level. The Programme Officers generate wage payment orders and issue cheques and hand them over to sub post masters every Monday. They also facilitate the sub post masters and branch post masters in receiving the cash. Every Friday the wage seekers withdraw amount from their postal accounts. Since inception, 77.2% of payments are being made within 15 days of closer of Muster Rolls.

Dumka District - Jharkhand

In Dumka District, payment of wages is made through Banks. On the basis of corrected Muster Rolls, cheques are transferred to respective banks. Outstation cheques take about 15 days for clearance. For smooth payment, accounts have been opened by the all the agencies in almost all the bank branches so that labourers get payments on the same day without any delay. District administration has also developed a system to ensure smooth payment through Post Office. Muster Rolls are collected and advice prepared accordingly. Fund assessment is made from particular day from each post office and the same amount is deposited in cash in the respective branch post office. A specific day is fixed for group of labourers for a particular group of schemes for wages payment through post office. Prior information is given to the labourers about the time and date of payment for a particular post office. On that particular day wages payment is ensured in the presence of respective Panchayat Sewak/ Rojgar Sewak/ Junior Engineer/ Supervisor, etc.

Success story on NREGA

According to The Challenge of Employment in India: An Informal Economy Perspective, Volume-I, Main Report, National Commission for Enterprises in the Unorganised Sector (NCEUS), April, 2009, http://nceus.gov.in/

The performance of the scheme in the state of Andhra Pradesh has been laudable because of strong political will and also because the state has had a rural worker and community mobilization movement. In addition, Andhra Pradesh has successfully employed computerization and e-governance mechanisms for monitoring the scheme. For, example, funds are being transferred electronically; every jobs seeker has got a bank account and wages are paid through bank or post office account; the whole process from job application to registration is computerized.

In Rajasthan, which has the history of drought relief based public employment and active civil society, the success of NREGA is more impressive compared to other north Indian states. Dungarpur district was able to make NREGA more of a success because of the presence of effective grassroots NGOs and their ability to mobilize the poor. Further, in Rajasthan, the innovative arrangement of having a ‘mate’ supporting worksite management has led to greater productivity of workers, easier worksite supervision and greater transparency in maintaining of work related records. Facilitation of the scheme by the local civil society organisation, the Jagrut Adivasi Dalit Sangathan (JADS) in Pati block of Madhya Pradesh bears testimony to public action from below to inculcate the practice of work on demand through application, receipts at the time of submission of applications and ensuring the payment of unemployment allowance, if necessary.

In Kerala, the NREG implementation pivots around the Kutumbashree (Self Help Groups of poor women). These women are not only involved in identifying the public work projects, but also overseeing the implementation. Besides Kerala has also used banks and post offices for wage payment. All these have resulted in high participation rate of women and an overall efficient system. Manifold increase in the number of work days, reduction in distress out-migration, enrolment in schools were observed in a study of 8 states by Indian School of Women’s Studies and Development, New Delhi.

In the tribal dominated and backward district of Pakur in Jharkhand, customized information, education and communication (IEC) activities had a large role to play in awareness generation about the NREGA (IHD 2009). Social audit conducted as a part of “NREGA Watch” of National Institute of Rural Development revealed absence of contractors and machines, kutcha muster rolls, presence of first aid facilities at stone quarries and mines, payment of wages through bank accounts (119,000 labour families had opened accounts in Banks/ Post Offices after NREGA), convergence with health and aaganwadi schemes, better quality of governance and better attendance at gram sabhas (270 out of 284 individuals attended the Gram-Sabha in 2008)