Centre to ensure adequate fund flow to the States & UTs under MGNREGS

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The Ministry of Rural Development is making all efforts to ensure adequate fund flow to the States / UTs under MGNREGS. It has released Rs. 40,480 crore so far in this Financial Year which is around Rs 4,500 crore more than the release during the corresponding period of the last financial year.

As per the financial norms, after 30th September of every year, the States/UTs are required to submit Audited Reports and Utilization Certificates (UC) of previous financial year along with other requisite information in prescribed formats for release of second tranche of funds. To facilitate the submission of proposal for second tranche, the Ministry conducted a special Mid-Term Review with the States and UTs during the period from 29th August to 13th October 2017.

The submission of complete proposal including Audited Reports and UCs is mandatory for ensuring financial discipline. The Ministry has been scrutinizing the complete proposals with promptness and has been releasing funds. Immediate action has been taken on proposals submitted so far by Madhya Pradesh, Uttar Pradesh, Tamil Nadu, Rajasthan, Chhattisgarh and Jammu & Kashmir and proposals have been processed. The Ministry has been constantly engaging with the rest of the States / UTs for submission of proposals without delay.

The current Financial Year is marked by the highest ever budget allocation of Rs. 48,000 crore. The table below gives a glimpse of the revised estimate at the Centre’s level and the expenditure in the States/UTs over the last 7 years.

Year Budget (Cr) Expenditure (Cr)

(Including State Share)

2011-12 31,000.00 37,072.82
2012-13 30,287.00 39,778.29
2013-14 33,000.00 38,511.10
2014-15 33,000.00 36,025.04
2015-16 37,345.95 44,002.59
2016-17 48,220.26 58,531.46
2017-18* 48,000.00 40,725.05

* Figures as on 27.10.2017

The Government has provided much higher allocations to the Ministry of Rural Development in the last three years.  As is evident from the table below, the allocation to Rural Development programmes for creation of infrastructure, rural housing and employment has gone up from 0.50% of the GDP in 2012-13 to 0.63% of the GDP in 2016-17:


Rs. Crores

Year GDP at Current Prices (2011-12 Series) MGNREGS Exp. % of GDP Releases by MoRD for all Programmes Releases as % of GDP
1 2 3 4 5 6
 2012-2013 9944013 39,778.82 0.40 50,161.86 0.50
 2013-2014 11233522 38,552.62 0.34 58,623.08 0.52
2014-2015 12445128 36,025.04 0.29 67,263.31 0.54
 2015-2016 13682035 44,002.59 0.32 77,321.35 0.57
 2016-2017 15183709 58,531.46 0.39 95,096.04 0.63

There is no paucity of funds for MGNREGS at this juncture. However, the Ministry has sought additional funds from the Ministry of Finance for meeting additional requirements.

In line with the directives of Hon’ble Supreme Court the Ministry is taking all steps to ensure timely payment of wages as well as payment of compensation for delay in payment of wages.

Due to constant efforts, the situation has improved considerably. The timely signing of FTOs has improved from 43.6 % to 84.9 %. Year wise status is given below:

The Ministry is also regularly reviewing the process from the generation of FTO to the actual credit of the wages into the accounts of the workers. It has been constantly following up with Chief Managing Directors of Banks, NPCI, PFMS, Department of Posts and Department of Financial Services to ensure credit of wages into the accounts of the workers within 24 hours of release.

The Ministry is constantly monitoring the status of payment of compensation for delay in payment of wages with respect to amount not approved, amount approved and payments made.  As on date, out of Rs. 80.58 crore of approved delay compensation since coming in force of the provisions for compensation for delay in payment of wages, Rs. 51.40 crore have already been paid due to the constant engagement with the states.

The Ministry had constituted a committee for revisiting the existing wage rate linked to CPI-AL under the chairmanship of Shri Nagesh Singh, Additional Secretary, MoRD. The committee has submitted a report recommending the indexation of wages to CPI Rural. The recommendations have been sent to the Ministry of Finance for consideration.

The Ministry has been making it clear that there are no preconditions like Aadhaar number linkage to bank account, uploading of photograph on electronic Job card or denial of work to households not possessing toilets, for getting wage employment under the Programme. All steps are being taken to ensure that all demands for wage employment are met on the ground.

The Ministry is committed to making adequate funds available for implementation of programme and ensuring timely payment of wages along with greater focus on drought proofing, agricultural & allied activities and diversification of livelihoods.