Analysis of MGNREGA Workdays and Budget Allocation (2024-25)

Decline in Workdays

• The average workdays per household under the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) decreased to 44.62 days in 2024-25 from 52.08 days in 2023-24.
• The total "person days," which accounts for the number of workdays by a person registered under MGNREGA, fell from 312.37 crore in 2023-24 to 239.67 crore in 2024-25.

Budgetary Concerns

• The budget allocation for MGNREGA remained stagnant at ₹86,000 crore, similar to the previous year.
• As of February 1, 2025, there was a deficit of ₹9,860 crore, with pending wages amounting to ₹6,948.55 crore as of January 25.
• It is expected that around 20% of the budget will be utilized to clear past dues, effectively reducing the budget for FY 2025-26 to approximately ₹70,000 crore when adjusted for inflation.
• This reduced allocation is about ₹4,000 crore less than the previous year, considering inflation adjustments.
• As a percentage of GDP, the MGNREGA allocation has declined to 0.24% from 0.26% in the previous financial year.

Implications

• Inadequate budget will lead to delays in wage payments and increased financial distress for rural workers.
• Suppression of work demand and denial of the right to employment are anticipated consequences.
• Reduction in quality asset creation and weakening of rural infrastructure are additional concerns.

Political Reactions

• Opposition criticized the government's neglect of MGNREGA, citing its importance as a crucial safety net for rural livelihoods.
• He noted that the inadequate budget reduces MGNREGA's reach, particularly affecting drought-hit and poor rural workers.
• The lack of significant increase in wages, despite a 7% rise in the minimum average notified wage rate during a period of 5% CPI inflation, highlights a crisis of wage stagnation.