Govt to boost rural spending; bring all MGNREGA wage payments under DBT

03 February 2016

Government is planning a big push to rural employment generation through increased public spending in sectors like roads, electrification, health, education and irrigation to spur growth, finance minister Arun Jaitley said on Tuesday.

Jaitley said the government is committed to strengthen the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) to spur the growth as private sector is not contributing to it as desired.

Allaying concerns that the scheme may be scrapped, Jaitley noted that schemes cannot be cast in stone and need to be reviewed. ''When a government scheme runs for many years, an attitude of indifference develops towards it. A kind of indifference towards it was growing by 2013-14, when the scheme had entered its seventh and eighth years,'' he said.

He said the government has allocated Rs37,000 crore to MGNREGA this fiscal, which is the highest ever budgetary support to the scheme. The allocation may be even higher in 2016-17, he said.

''One engine to grow further, despite the global slowdown that has also impacted our exports, can be by improving the rural economy. The Centre and State governments can do this through a rural push by measures such as rural electrification, roads and irrigation,'' Jaitley said on Tuesday at the MGNREGA Sammelan to mark 10 years of the scheme.

Jaitley noted that two consecutive years of bad monsoon had affected farm sector productivity and demand. He said the government needs to introduce as many such measures as possible to not help the people in these areas and also boost the economy.

Speaking at the meeting, rural development minister Chaudhary Birender Singh said the government will make all wage payments under the MGNREGA through direct benefit transfer to bank accounts of the beneficiaries beginning 1 April this year, in order to prevent leakages in the flagship rural employment programme.

Currently, 94 per cent of the wage payments are directly deposited in the account of beneficiaries. Beginning 1 April 2016, all wage payments to MGNREGA workers will be done through DBT, rural development minister Chaudhary Birender Singh told the tenth anniversary meeting of MGNREGA Sammelan.

The minister said an electronic fund management system (e-FMS) has been made mandatory from 1 April this year to ensure timely release of funds to states to provide work on demand, better coordination between banks and post offices and for effective monitoring of pendency of payments.

He said employment generation in terms of personday has been the highest in the second quarter at 458.8 million and in the third quarter at 461.0 million compared to the last five years.

Singh also said that more than 64 per cent of total expenditure was on agriculture and allied activities and 57 per cent of all workers were women, well above the statutory requirement of 33 per cent, the highest in three years.

Minister of state for rural development Sudarshan Bhagat said that since the start of the programme, the expenditure on it has amounted to Rs3,13,844.55 crore and out of this 71 per cent has been spent on wage payments to workers.

He said, the focus for the upcoming years will be on simplification and strengthening of procedures and a master circular is being issued which consolidates all key instructions from the central government on the implementation of the Act.

Bhagat said the ministry will also aim to train and place 10,000 barefoot technicians from worker households and through Project LIFE, skill and train workers for wages, for self-employment and livelihood upgradation.

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