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Indian Express
20-06-2025
- Politics
- Indian Express
Calcutta High Court's MGNREGA order underlines people shouldn't suffer for the corruption of a few
Written by Purbayan Chakraborty and Mrinalini Paul In a recent verdict, the Calcutta High Court has directed the Centre to resume work under the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) scheme in West Bengal from August 1. The Centre, through an earlier order dated March 9, 2022, stopped releasing funds for the scheme, citing irregularities under Section 27 of the Act. In May 2023, Paschim Banga Khet Majoor Samity, a rural workers' trade union, filed a petition in the HC challenging the suspension. The HC order is a much-awaited relief for the state and its millions of NREGA workers. The Right to Livelihood is a fundamental right that flows from Article 21 of the Constitution. Any executive action that seeks to curtail a fundamental right must pass the proportionality test as laid down and consistently employed by the Supreme Court in a series of cases like Association for Democratic Reforms v. Union of India (2024). The test requires that any such executive measure hold a legitimate objective and follow suitable means. It also mandates the use of an equally effective alternative. The impact on the individual's right must not be out of proportion to the objective being pursued. The irregularities were found in only a few of West Bengal's more than 3300 gram panchayats. Instead of taking targeted corrective action, the Centre chose to issue a state-wide blanket stoppage of funds under MGNREGA, rendering millions of rural workers unemployed. This action was neither the least restrictive nor proportionate to the objective that was being pursued. Hence, it failed the proportionality test on both counts. Section 27 of the Act empowers the Centre to stop the funds under the MGNREGA scheme as a last resort in cases of proven irregularities. But it also places a corresponding duty on it to employ remedial measures in a time-bound manner and resume implementation of the scheme within a reasonable period of time. However, in this case, even after more than three years, the Centre failed to resume funding. Therefore, the HC rightly held: 'The scheme of the act does not envisage a situation where it would be put to cold storage for eternity.' Section 27 balances accountability with livelihood — that balance was breached in this case. The HC's order is a reaffirmation that executive in the exercise of their discretionary powers cannot go beyond statutory or constitutional limitations. Corruption is grave but not uncommon in our country. But should the vulnerable people suffer due to corruption at higher levels? The funding was stopped at a time when the MGNREGA could have been a coping mechanism, especially for the thousands of poor rural workers who had returned home due to Covid. Unpaid wages and no new work in sight forced them further towards a vicious cycle of poverty, indebtedness, migration and malnutrition. The deprivation of the state and its population doesn't stop in MNREGA; it extends to other central schemes as well. The Ministry of Rural Development has informed a parliamentary panel that almost Rs 8,000 crore is yet to be released under the Pradhan Mantri Awas Yojana-Gramin (PMA-G) for West Bengal. In 2023, the state accused the Centre of stopping funds for Integrated Child Development Services (ICDS) and Pradhan Mantri Matru Vandana Yojana (PMMVY). However, the then Union Minister Smriti Irani refuted these allegations, saying that the state government was misusing funds and Rs 260 crore 'were lying unused'. West Bengal is also one of the three states in the country that refused to comply with the PM SHRI scheme and, as a result, has not received any funding for the Samagra Shiksha scheme (2024-25). However, the state government's response has been very confusing. Apart from playing the victim, it has rarely seemed to pursue logical or legal action. Often, it rushed to launch the state equivalent of the schemes that are blocked by the Centre. This happened even in the case of MGNREGA. The state launched the Karmashree scheme in 2024, under which every MGNREGA job cardholder household is supposed to get 50 days of work in a year. Launched just before the general elections, in no way, does it match the meticulous provisions of MGNREGA. For instance, Karmashree does not have any separately allocated budget |nor any mention of unemployment allowance. While the HC Order comes as an immediate respite to the state's 257 lakh registered NREGA workers, governments should read its larger message against 'weaponising schemes'. That corruption will not be tolerated is explicit in the order, as the HC empowered the Centre to impose special conditions on the state so that past issues do not recur. But that doesn't mean that people's lives and livelihoods could be compromised. With the assembly elections scheduled next year, the order has been hailed as a victory by both the TMC and BJP, but the real victory lies in the warning of the judiciary that they dare not mix up the politics of corruption and politics of welfare further. Chakraborty is a Kolkata-based lawyer and Paul is a researcher at TISS
Indian Express
15-06-2025
- Business
- Indian Express
Explained: Centre's rationale behind MGNREGS spending cap, the problems with it
Second byline: Purbayan Chakraborty The Union Finance Ministry has capped spending under the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) at 60% of its annual allocation for the first half of Financial Year (FY) 2025-26. There was no such spending limit until now. The programme has been brought under the Monthly Expenditure Plan/Quarterly Expenditure Plan (MEP/QEP), a spending control mechanism introduced by the Finance Ministry in 2017. MGNREGS, which provides up to 100 days of employment to any rural household on demand, was thus far exempt from MEP/QEP on account of being demand-driven. Civil society groups and MGNREGS worker unions have raised concerns about the move. Here's why. Finance Ministry's rationale MGNREGS has long been plagued with financial troubles, which are perhaps what the Finance Ministry hopes to address by implementing the MEP/QEP mechanisms. Data from the Ministry of Rural Development show that over the last few years, more than 70% of the budget is frequently exhausted by September, and while supplementary allocations are often made in December, even these run out by January. This leaves significant pending dues by the end of the FY — over the last five FYs, pending dues have ranged between Rs 15,000 crore to Rs 25,000 crore. On average, 20% of the subsequent FY's budget is spent in clearing these. By implementing an expenditure cap, the Finance Ministry is likely ensuring an adequate budget will remain for the latter half of the FY, so that no supplementary allocation will have to be made. The MGNREGS budget for FY 26 stands at Rs 86,000 crore, and FY 25 ended with pending dues of Rs 21,000 crore. As on June 12, the Centre has released 28% of FY 25-26's budget. Pending dues for FY 26 stand at Rs. 3,262 crore, and for FY 25 at Rs 19,200 crore. Just clearing these dues will exhaust approximately 50% of the budget. Issue of fluctuating demand By design, MGNREGS acts as a buffer for rural citizens, especially during times of lean harvests, freak weather events, and rural distress. Work demand under the scheme fluctuates throughout the year due to a number of reasons, primarily agricultural activities and weather patterns. MGNREGS work demand is highest between April and June, and picks up again after the kharif sowing season in September. But weather abnormalities such as delayed rains can lead to high MGNREGS work demand even in July or August. In 2023, for instance, low rainfall led to 20% higher work demand than usual in July and August, with Karnataka in particular spending more than 70% of the annual MGNREGS budget within six months due to extreme drought conditions. The expenditure cap does not take into account these contingencies. There is a legal issue too. Social security and welfare in India is implemented either via schemes designed and executed by the government of the day (for instance, PM Kisan Samman Nidhi or the LPG scheme), or through schemes based on specific legislation which establish certain programmes as statutory rights, like MGNREGS (based on MGNREG Act, 2005) or the Public Distribution System (based on National Food Security Act, 2013). The former can, and often are, altered, discontinued, or repackaged when a new government comes to power. For the latter, while the government does have the power to determine the modalities of implementing legislation, this power is conferred by the legislature and is limited in its scope. The MGNREGA recognises employment as a statutory right. The Act signified a critical shift from this being a negative right under Article 21 of the Constitution (which mandated that the state must not interfere with your livelihood unreasonably), to a positive statutory obligation on the government to provide employment on demand. The 60% spending cap ordered by the Finance Ministry makes it virtually impossible to realise an entitlement that is legally guaranteed under the Act once the ceiling is reached. Constitutional courts have held that financial inability cannot be a reason to disregard statutory or constitutional duties, including in Swaraj Abhiyan v Union of India (2016), Municipal Council, Ratlam vs Shri Vardhichand (1980), and Paschim Banga Khet Mazdoor Samity v State of W.B. (1996). Lack of clarity There is currently no clarity on what will happen once the ceiling is reached. States could be forced to deny employment even when there is demand, or workers may have to work without timely payment. In both scenarios, statutory rights of the workers may be violated — the right to to receive employment within 15 days of raising the demand, as provided under section 3 of the MGNREGA, and the right to receive wages within 15 days of closure of work, as mandated under para 29 of schedule II of Act. To be sure, wage delays have been rampant in the scheme for years, and unemployment allowances and compensation for delayed payments have gone unpaid or been poorly calculated (as the Supreme Court has observed). However, the Finance Ministry's decision undermines the letter and spirit of the Act in an attempt to address the financial problems in MGNREGS. Laavanya Tamang is Senior Researcher with the Foundation for Responsive Governance, and affiliated with the NREGA Sangharsh Morcha. Purbayan Chakraborty is a Calcutta-based lawyer and works closely with the Paschim Banga Khet Majoor Samity, a trade union representing rural workers in West Bengal. All data accessed from MGNREGS MIS on June 12
