Govt pares MNREGA compensation for delay in payment of wages -Nitin Sethi & Sahil Makkar

-Business Standard

The govt has in place regulations that systematically calculate less than the payable compensation

New Delhi: The Union government has been understating the compensation that workers should get under the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) for the delay in payment of wages. Not just that, only a portion of this understated compensation is being paid to the beneficiaries across the country.

According to the job guarantee scheme, wages should be paid to workers within 15 days of generation of the muster roll.

If that is not done, then the workers need to be paid compensation for each day of delay till the wages are deposited into their accounts.

However, the government has in place regulations that systematically calculate less than the payable compensation. These rules require the government to calculate the compensation only till the date a demand is raised at the district level by officials for payment of wages (called a fund transfer order, or FTO ), and not till the actual payment of wages to the worker.

An FTO is generated at the state level as a demand to the Centre for transferring the wages. The actual transfer of funds happens much later — normally within a week after the FTO generation — from the Union rural development ministry to the worker’s account, electronically.

Government records show that Rs 441 crore worth of compensation (calculated using the method that understates the amount) was due to workers for delayed wages in financial year 2016-17. Out of this, the government approved compensation of only Rs 17.15 crore and has paid Rs 10.70 crore so far.

For April 2017, compensation worth Rs 6.31 lakh stood payable on May 1, against delayed wages of Rs 52.80 crore. But the state-level authorities, empowered by the rules of the Centre, have so far paid only Rs 1,734 across the country. “We are working to correct it. We should be able to fix this in future,” a senior officer in the ministry of rural development said, responding to questions.

“Currently, 44 per cent of MNREGA transactions are happening on time. We are trying to improve it further by integrating the MIS system with the help of Public Financial Management System (PFMS) and National Informatics Centre. The part-1 (the time taken in generating muster roll and pushing the FTO to Centre) and part 2 (the time taken by the Centre to process the FTO and directly transfer the amount to the beneficiary’s account) would both be considered (for calculation of compensation),” the officer said.

The officer, however, noted that delay was largely occurring at the state level and not in payment from the Centre, adding the government was working hard to get states to pay wages on time.

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Business Standard, 3 May, 2017, http://www.business-standard.com/article/economy-policy/govt-pares-mnrega-compensation-for-delay-in-payment-of-wages-117050201458_1.html

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