UPSC MainsGENERAL-STUDIES-PAPER-IV202520 Marks250 Words
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Q16.

MGNREGA Program Mismanagement and Restoration

Mahatma Gandhi National Rural Employment Guarantee Program, MGNREGA was earlier known as National Rural Employment Scheme, NREGA. It is an Indian Social Welfare Program that aimed at fulfilling the 'Right to Work' provisions made in the Constitution. MGNREGA was launched in 2006 under Rural Employment Sector by the Ministry of Rural Development.

Main objective of the program is to give legal guarantee of wage employment to the adult members of rural households who are willing to do unskilled manual labour work subject to a maximum of 100 days per year for every household. Every rural household has the right to register under the scheme, job card is issued to the registered, Job Card holder can seek employment; State Government shall pay 25% of minimum wage for the first 30 days as compensatory daily unemployment allowance to the families and of wage for remaining period of the year. MGNREGA work was undertaken by various Gram Panchayats.

You have been appointed as an Administrator Incharge of the District. You have been given the responsibility of monitoring MGNREGA work undertaken by various Gram Panchayats. You are also given the authority to give technical sanctions to all MGNREGA works.

In one of the Panchayats in your jurisdiction, you notice that your predecessor has mismanaged the Program in terms of :

  • Money not disbursed to actual job-seekers.
  • Muster Rolls of the Labourers not properly maintained.
  • Mismatch between the work done and payments made.
  • Payments made to fictitious persons.
  • Job Cards were given without looking into the need of person.
  • Mismanagement of funds and to the extent of siphoning of funds.
  • Approved works that never existed.

(a) What is your reaction to the above situation and how do you restore the proper functioning of MGNREGA Program in this regard ?

(b) What actions would you initiate to solve the various issues listed above ?

(c) How would you deal with the above situation ?

How to Approach

The answer should address all three parts of the question systematically. Begin by outlining an immediate reaction emphasizing ethical governance and accountability. For restoring proper functioning, focus on immediate corrective measures, administrative reforms, and leveraging technology. When addressing specific issues, categorize them and provide targeted actions. Conclude with a forward-looking perspective on strengthening the program for sustainable rural development.

Model Answer

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Introduction

The Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) is a landmark social welfare program ensuring the 'Right to Work' for rural households, providing a legal guarantee of 100 days of unskilled manual work annually. Launched in 2006, it aims to enhance livelihood security and create durable assets in rural areas. However, its implementation has frequently been plagued by systemic issues such as fund mismanagement, corruption, and lack of transparency. As a District Incharge with monitoring and technical sanction authority, encountering severe irregularities in a Gram Panchayat necessitates a robust and multi-faceted approach to uphold the scheme's integrity and ensure its benefits reach the intended beneficiaries.

(a) Reaction and Restoration of Proper Functioning

Upon discovering the mismanagement in the Gram Panchayat, my immediate reaction would be one of serious concern and a strong commitment to ethical governance and accountability. The identified issues indicate a complete disregard for the scheme's objectives and a betrayal of public trust, directly impacting the livelihood security of the most vulnerable.

Immediate Steps to Restore Proper Functioning:

  • Halt New Approvals: Immediately suspend all new work approvals and fund disbursements for the implicated Gram Panchayat until a thorough investigation is conducted and corrective measures are in place.
  • Transparency and Communication: Conduct an immediate meeting with the Gram Panchayat members, local community leaders, and a representative group of job-seekers to acknowledge the issues and outline the intent for reform.
  • Initial Fact-Finding: Deploy a rapid assessment team (comprising officials from various departments like finance, rural development, and technical experts) to gather initial evidence and understand the scale of the mismanagement.
  • Ensure Worker Confidence: Publicly reassure genuine job-seekers that their entitlements will be protected and that mechanisms will be put in place to ensure timely and correct payments going forward.

(b) Actions to Initiate to Solve Various Issues

To address the specific issues of mismanagement, a structured approach with targeted actions would be implemented:

1. Money Not Disbursed to Actual Job-Seekers & Payments Made to Fictitious Persons:

  • Forensic Audit: Order a comprehensive forensic audit of all financial transactions, wage payment records, and bank accounts linked to MGNREGA in the Panchayat for the past few years.
  • Biometric Verification: Implement mandatory Aadhaar-based Biometric Attendance System (ABAS) and Aadhaar-Based Payment System (ABPS) for all workers to verify identity and attendance, ensuring payments reach only genuine beneficiaries. As of 2024, the government emphasizes ABPS to enhance transparency.
  • Direct Benefit Transfer (DBT): Ensure 100% wage payments are made directly into verified bank accounts of beneficiaries, eliminating intermediaries.
  • Recovery of Siphoned Funds: Initiate legal proceedings against individuals found responsible for siphoning funds and take stringent measures for fund recovery.

2. Muster Rolls Not Properly Maintained & Mismatch Between Work Done and Payments Made:

  • Digital Muster Rolls (e-Muster): Introduce and strictly enforce the use of e-Muster rolls (e.g., through the National Mobile Monitoring System app) to capture real-time attendance and work progress, reducing manual manipulation.
  • Geo-tagging of Assets: Mandate geo-tagging of all completed and ongoing work sites at various stages (before, during, and after) to verify physical existence and progress of work.
  • Technical Assessments: Conduct technical assessments by junior engineers to verify the quantity and quality of work done against the approved estimates and payments.
  • Public Display of Records: Display muster rolls, payment lists, and work details prominently at the Gram Panchayat office and worksites for public scrutiny.

3. Job Cards Given Without Looking into the Need of Person:

  • Re-verification Drive: Launch a comprehensive job card re-verification drive, involving Gram Sabha members, to identify and cancel fraudulently issued job cards.
  • Awareness Campaigns: Conduct awareness campaigns to educate rural households about their 'Right to Work' and the correct procedure for applying for a job card, minimizing the scope for intermediaries.
  • Demand-Driven Registration: Ensure that job cards are issued strictly based on genuine demand for work from adult members of rural households.

4. Mismanagement of Funds and Approved Works that Never Existed:

  • Enhanced Monitoring: Establish a robust multi-layered monitoring mechanism including regular field visits by block and district officials, third-party monitoring, and social audits.
  • Technical Sanctions Review: Exercise strict oversight on technical sanctions, personally reviewing proposals and conducting spot checks before approval, especially for new works.
  • Capacity Building: Provide training to Gram Panchayat functionaries and technical assistants on financial management, record-keeping, and scheme guidelines.
  • Convergence: Promote convergence with other government schemes (e.g., Jal Jeevan Mission, Pradhan Mantri Awaas Yojana-Gramin) to create more durable assets and streamline fund utilization.

(c) Dealing with the Situation – A Comprehensive Approach

My strategy would combine punitive actions with preventive and systemic reforms to ensure long-term integrity of MGNREGA:

  • Legal and Administrative Action:
    • Initiate criminal proceedings against officials and non-officials involved in fund siphoning, fictitious payments, and creation of ghost works, based on audit findings.
    • Impose administrative penalties and departmental inquiries against erring government employees.
    • Blacklisting of contractors (if any) and individuals involved in malpractices.
  • Strengthening Grassroots Governance:
    • Empowering Gram Sabhas: Actively involve Gram Sabhas in planning, monitoring, and social audits (a statutory requirement). As per the Act, Gram Sabha is the primary forum for social audits. This decentralised oversight can significantly reduce corruption.
    • Capacity Building: Provide continuous training and resources to Gram Panchayat members and staff on MGNREGA guidelines, financial management, and use of digital tools.
  • Technological Interventions:
    • Leverage the National Electronic Fund Management System (NeFMS), eFMS, and Aadhaar-based payment systems more effectively.
    • Promote the use of the National Mobile Monitoring System (NMMS) App for transparent attendance and geo-tagging of worksites.
    • Utilize data analytics to identify patterns of irregularities and potential fraud.
  • Grievance Redressal and Whistleblower Protection:
    • Establish an easily accessible and responsive grievance redressal mechanism, possibly utilizing the Ombudsperson for MGNREGS (launched in 2022).
    • Ensure protection for whistleblowers who come forward with information about corruption.
  • Periodic Social Audits: Make social audits a regular, mandatory, and truly independent exercise, with active participation from civil society organizations and local communities. Public hearings should be held to discuss audit findings and ensure accountability.

By taking swift, decisive, and systemic actions, the aim is not just to punish wrongdoers but to rebuild trust in the MGNREGA program, ensuring it effectively serves its purpose of providing a crucial social safety net for rural India.

Conclusion

The profound mismanagement of MGNREGA funds and processes in the said Gram Panchayat highlights a critical breach of public trust and the scheme's foundational principles. As District Incharge, my comprehensive response would involve immediate cessation of irregularities, rigorous investigation, and stringent legal action against culprits. Concurrently, a robust framework leveraging technology, enhanced transparency through geo-tagging and e-muster rolls, empowered Gram Sabhas, and strengthened grievance redressal mechanisms would be implemented. The goal is to restore the program's credibility, ensure efficient resource utilization, and guarantee that the 'Right to Work' translates into tangible benefits for every deserving rural household, thereby reinforcing democratic decentralization and sustainable rural development.

Answer Length

This is a comprehensive model answer for learning purposes and may exceed the word limit. In the exam, always adhere to the prescribed word count.

Additional Resources

Key Definitions

Social Audit
A social audit is a process by which the Gram Sabha or any other body verifies and assesses the implementation of a program or scheme, especially government initiatives, to ensure transparency, accountability, and the achievement of intended objectives, often comparing official records with ground realities.

Key Statistics

As of March 29, 2025, the total financial misappropriation across the country under MGNREGA stood at ₹193.67 crore for 2024-25, with only ₹10.29 crore (5.32%) recovered. (Source: Ministry of Rural Development data, Hindustan Times, March 31, 2025)

Source: Hindustan Times

The budget allocation for MGNREGA in the Union Budget for 2025–26 remained unchanged at ₹86,000 crore, identical to the previous year. This is despite actual expenditure in the preceding fiscal year being ₹1.05 lakh crore, exceeding the allocated amount by ₹19,297 crore. (Source: Union Budget 2025-26, MGNREGA in Crisis report, May 31, 2025)

Source: Union Budget 2025-26

Examples

Aadhaar-Based Payment System (ABPS)

The government has increasingly pushed for ABPS in MGNREGA to link workers' wages directly to their Aadhaar-seeded bank accounts. While aimed at reducing corruption and delays, it has also faced challenges related to technical glitches, unlinked accounts, and exclusion errors, as seen in Jharkhand where 38.11% of MGNREGA workers were ineligible for online payments due to unlinked bank accounts in FY 2024-25. (Source: Ministry of Rural Development, MGNREGA in Crisis report, May 31, 2025)

Frequently Asked Questions

What is the role of a District Programme Coordinator (DPC) under MGNREGA?

The District Programme Coordinator (DPC), usually the Chief Executive Officer of the District Panchayat or Collector, is responsible for the overall coordination and implementation of MGNREGA in the district. Their functions include consolidating block plans, according sanctions, monitoring performance of Programme Officers, conducting inspections, and redressing grievances, as per Section 14 of the MGNREGA Act, 2005.

Topics Covered

EthicsCase StudyGovernanceRural DevelopmentMGNREGAProgram MismanagementCorruptionAccountabilityRestoration of Functioning