Amarjeet Sinha-led Panel on MGNREGA Restructuring

December 1, 2022

The Central Government has set up a panel to recommend structural and other reforms required for the effective implementation of the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA).

About the panel

The panel will be headed by Amarjeet Sinha – the former Rural Development Secretary and advisor in the PMO. Chief Economic Advisor Anantha Nageswaran is one of the members of this panel. The panel met for the first time in November 21 this year. It is expected to submit its report by February 2023.

Why was the panel formed?

The MGNREGA was enacted in 2005 to implement a demand-driven scheme that guarantees 100 days of unskilled work per year for any rural household that requires it. There are currently 15.51 crore active workers who receive livelihoods under this scheme.

The Sinha-led panel is tasked with assessing various factors behind the demand for MGNREGA work, expenditure incurred by the government, inter-state variations, and the composition of work.

In the current structure, economically strong states like Kerala benefit more from MGNREGA than poorer states like Uttar Pradesh and Bihar due to the presence of necessary revenue for implementation.

The panel will also look into the argument that the cost of providing work under MGNREGA has surged since the scheme was launched. It will provide recommendations on changes in focus areas and governance structures to make MGNREGA more effective.

The Panel will study the composition of work taken up under the MGNREGA, which has been criticized for not providing tangible assets. It will provide recommendations on whether the composition of work must be changed and review whether the scheme should focus more on community-based assets or individual works.

MGNREGA’s role during the COVID-19 pandemic

Despite various criticism against the MGNREGA, it had been an important safety net during the COVID-19 pandemic. During the financial year 2020-21, the number of person days of work provided under this scheme was 389 crore – an increase when compared with the previous year’s figure of 265 crore.

In the present financial year, Rs.59,420 crore was spent out of Rs.73,000 crores sanctioned for the scheme. The Rural Development Ministry is currently seeking an additional Rs.25,000 crore from the Finance Ministry since it anticipates more expenditure before the current financial year ends.

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