Bengal Potentially Misses Out on Over ₹22,000 Crore in MGNREGS Funds, Benefiting Other States
Increased Employment in MGNREGS Scheme: West Bengal's Decrease sparks Opportunities for Tamil Nadu, Uttar Pradesh, and Bihar
Looks like it's time to question the avalanche of cash under the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS)! Alarm bells are ringing as West Bengal could've taken a major hit, losing around ₹22,000 crore from FY23-FY25 due to suspected shenanigans, with the loot hopping over to Tamil Nadu, Uttar Pradesh, Bihar, and Maharashtra.
Let's dive into the nitty-gritty. These fortunate states scooped an extra ₹13,000 crore during these fateful years, while the overall scheme's spending remained rather stable at around ₹86,000-88,000 crore yearly. FY26 has slated ₹86,000 crore as the spending total.
Mysteriously, the flow of funds to West Bengal has been frozen since March 9, 2022, thanks to some noncompliance with Central guidelines under Section 27 of the MGNREG Act. In FY22, Bengal got ₹7,508 crore, but nothing since then. Despite the funding drought, the scheme still managed to avoid savings, with a high point of ₹1.1 lakh crore in FY21 amidst the persistent rural distress. Funds have been dwindling since then as economic activity revved up and leakages were plugged. The spending saga goes like this: ₹96,812 crore in FY22, ₹88,290 crore in FY23, ₹88,217 crore in FY24, and ₹85,771 crore in FY25.
Tamil Nadu, which managed to snag ₹9,707 crore in FY23, saw its share grow to ₹12,603 crore in FY24, raking in suspicions of using the scheme for state projects or funneling funds towards machinery for projects instead of raw labor. Tightening screws on the rules saw the share shrink to around ₹7,600 crore in FY25.
Bihar's portion gradually expanded from ₹5,407 crore in FY22 to over ₹6,700 crore in FY25, while Uttar Pradesh's share jumped from ₹8,510 crore to ₹10,269 crore in FY23, later dipping back to around ₹9,700 crore in FY25. Maharashtra, originally receiving a humble ₹2,056 crore in FY22, bagged a whopping ₹4,900 crore in FY25.
Come one, come all! MGNREGS aims to offer at least 100 days of guaranteed wage employment annually for rural households desperate for unskilled manual labor, chiefly during off-seasons.
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- The reallocation of funds from West Bengal to other states under the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) raises questions about the transparency and accountability of the scheme's finance management.
- The growing investment in states like Tamil Nadu, Bihar, Uttar Pradesh, and Maharashtra from FY23 to FY25 has led to concerns about potential misuse of MGNREGS funds for state projects or diversion of funds towards machinery instead of raw labor.
- In the realm of general news and finance, the spectacular increase in MGNREGS funds allocated to states like Maharashtra and the fluctuation in funds allocated to states like Bihar and Uttar Pradesh are topics worthy of DeFi and business discussions.
- The politics surrounding the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) goes beyond rural development, as the reallocation of funds has significant implications for the overall economy and financial market, making it a matter of national interest and concern.
