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Fund crunch hits MGNREGA scheme
Why is it in the news?
- The union government is on the verge of running out of funds for the crucial Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) scheme.
More in the news
- Pending Dues:
(1) More than 96% of the allocated money has already been spent or is needed to pay pending dues, with less than Rs. 2,500 crore left to sustain the scheme for the next two months.
(2) Rajasthan has the highest negative net balance of ₹620 crore, followed Uttar Pradesh and Maharashtra.
- Shortage in Critical Times:
(1) January, February and March are months with little agricultural activity, when rural workers desperately need employment.
(2) However, the scheme is running out of money, and will enter next year with pending liabilities.
- Liquidity essential for growth revival:
(1) Number of economists have recommended that putting money into the hands of rural consumers via MGNREGA is key to kickstart the economy.
(2) However, this year’s budget allocation was ₹60,000 crore, lower than the amount spent in the previous year.
Source
The Hindu.