Economy

MNREGS last hope for returning migrants, but demand for jobs far outpaces supply

Updated : June 17, 2020 09:14 PM IST

States have gone on an overdrive to make new job cards for families which had been left out earlier.

While the money flow from centre has improved and payment cycles have improved vis-à-vis last fiscal, the budgets may not last long

Jobs under the government’s rural job guarantee scheme have almost doubled as migrant workers leave cities and return home to an uncertain future. There has been a marked increase in demand for work under MNREGS across states, from 1 crore persons per day average in pre-COVID times to almost 2.1 crore in the month of May. The average demand for MNREGS in June so far has been consistently above 3.5 crore persons per day, almost double of last year’s 1.8 crore.

As a deluge of migrants reached their villages and lockdown rules were eased, a broader push by the Central government saw MNREGS witness the highest jump in demand and work given under the scheme. Large states like Rajasthan have seen the highest increase in work generated and states like Uttar Pradesh, Bihar, Chhattisgarh with a large labour force are also seeing a significant rise in work.

The problem is that these states are unable to create enough jobs under MNREGS to keep up with the demand.

Uttar Pradesh has witnessed the sharpest year-on-year surge in job demand at 300 percent and employed the highest number of people at over 57 lakhs as on June 15. This is in absolute terms. Nearly 80 percent of all migrants have moved back to Uttar Pradesh and Bihar.

The shelf of work, meaning nature and quantum of work under NREGS, was planned last fiscal and did not account for the unusual demand, caused by the nationwide lockdown and the reverse migration of millions of migrants.

Experts say the gap will widen further if the type of works under MNREGS is not expanded, especially during monsoon months where jobs will be limited.

Kamayani Swami of Jan Jagruti Shakti Sangathan in Bihar says the need is to converge various schemes with NREGS and look at large scale works to create newer avenues.

Nearly 28 lakh migrant workers travelled back to Bihar and another 30 lakh to Uttar Pradesh in May.

MNREGS is a centrally sponsored, demand driven scheme. The fund allocation for the scheme was increased by nearly two-third to Rs1 lakh crore for the fiscal as a response to the need for a rural stimulus and job creation. States have seen better fund flows from the centre, faster clearance of wage payments in the last 3 months, and experts fear the funds are going to run out very quickly.

“Government should look at another supplement to budget already,” says Khera.

Here’s a deep dive into the data on the Mahatma Gandhi Rural Employment Generation Scheme.

Increase in total and active Job cards

States have gone on an overdrive to make new job cards for families which had been left out earlier. This is reflective of the increase in number of total job cards from 13.6 crore till the beginning of the year to 14.05 crore job cards as on June 15.

The active job cards have also seen a surge from 7.6 crore at the start of FY21 to 8.04 crore as on June 15, indicating that more families are seeking and working under MNREGS.

Demand for MNREGS Work

The first month of the lockdown however saw a dip in those who got work under MNREGA. Restrictions on travel, social distancing norms, and lack of clarity to states on lockdown rules led to a drop in works under MNREGS. So when 1.2 crore households demanded work, only about 94.89 lakhs were given work, much less than a year ago period when 1.7 crore households worked under MNREGS.

In May, however, demand soared as 3.44 crore households and 4.89 crore persons sought MNREGS jobs. This was the highest demand in five years. Against this, 2.97 crore households and 3.18 crore persons were given work. This was higher by one third versus a year-ago period when 2.12 crore households got work.

May 2020 – MNREGS demand and jobs

Work demanded: 3.44 crore Households / 4.89 crore persons

Work given: 2.97 crore households /3.18 crore persons

States like Uttar Pradesh, West Bengal, Odisha, Chhattisgarh, Madhya Pradesh, Bihar saw a substantial increase in May 2020 in the number of households registering for work. Uttar Pradesh saw an almost 300 percent increase.

Households working under MNREGS - May 2020 vs May 2019
Uttar Pradesh	300%
West Bengal	208%
Odisha	109%
Chhattisgarh	80%
Madhya Pradesh	68%
Bihar	64%

For the first half of June, demand has held up with 3.2 crore households demanding work. Till June 7, roughly 87 lakh families were provided jobs.

Having got a large number of migrants back, states like Bihar have not been able to ramp up as well. Kamayani Swami of Jan Jagruti Shakti Sangathan says the difference is the disproportionate labour budgets assigned to states. “Approved labour budgets for Bihar is Rs 18 crore when we have more than 2 crore job cards and for Rajasthan is Rs 30 crore with just 1.09 crore job cards. With the existing machinery we have even if we saw 100 percent jump it would not be able to accommodate the kind of influx we are seeing.”

JJSS is a North Bihar focussed organisation focussed on workers’ rights.

Individual states like Rajasthan, Uttar Pradesh have expanded work under MNREGS and as of June 15, had the highest number of workers employed on daily basis.

No of workers on MNREGS job on June 15
Uttar Pradesh	57.13 lakh
Rajasthan	53.45 lakh
Andhra Pradesh	36.58 lakh
West Bengal	26.72 lakh
Madhya Pradesh	23.95 lakh

Experts say political will matters a lot in implementation of MNREGS work and is seen in states like Chhattisgarh, where the average days of work provided in May was 12 days, the highest in the country. Rajasthan is outpacing others in the month of June. Reetika Khera of IIT-Delhi says, “While the absolute numbers of Uttar Pradesh look impressive, with over 55 lakh people working on a daily basis, as a proportion of the large population it still is not adequate.”

Demand is far outpacing the available work and there is a need to generate new work infrastructure to accommodate more workers.

“MNREGS is employment guarantee scheme, but not everyone who demands a job is getting registered and even of those registered, not all are guaranteed employment,” says activist Nikhil Dey of Mazdoor Shakthi Sangathan.

As of June 15, on an average, 19 person days of work has been generated under MNREGS. State-level data differs, with UP generating 16.68 and Bihar 21.96 person days during the last 4 years, on an average

Fund availability for MNREGS

Nearly two-thirds of the initially budgeted fund of Rs 61,000 crore have already been spent. This included Rs 15,000 crore to clear pending dues of FY20. The government has expanded the kitty by an additional Rs 40,000 crore, however that will come in once the earlier budget is exhausted.

While the money flow from centre has improved and payment cycles have improved vis-à-vis last fiscal, the budgets may not last long.

Most of the states have utilised maximum part of their available NREGS funds and may be staring at a nil balance sheet and no funds to generate works in coming days. “This is a worrying sign and Centre needs to immediately supplement funds to the states because as funds dry up, states will not want to continue generating work and rural workers may suffer,” said Rakshita Swamy, an activist.

As of June 15, there are little funds left in key labour rich states where most migrants have returned home. Odisha has already slipped into a deficit of Rs 94 crore.

States and remaining funds (as of June 15)
Uttar Pradesh	Rs 476 crore
Bihar	Rs 262 crore
Chhattisgarh	Rs 250 crore
Madhya Pradesh	Rs 314 crore
Rajasthan	Rs 614 crore
Maharashtra	Rs 202 crore
Odisha	(-) Rs 94 crore

MNREGS last hope for returning migrants, but demand for jobs far outpaces supply

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