CONTEXT  

• Union Finance Ministry has capped Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGS) spending at 60% of annual budget for H1 of FY 2025–26.
• First time such a cap has been imposed; civil society and worker unions raised concerns.
• Cap may undermine the demand-driven nature of the scheme and affect timely rural employment.

CONCEPT  

• Based on MGNREGA 2005, the scheme provides legal right to work in rural areas.
• Guarantees 100 days of unskilled manual work annually to every rural household.
• Statutory right to employment: Shift from negative to positive obligation by the state.
• Work must be provided within 15 days of demand; else unemployment allowance is due.
• At least one-third of beneficiaries must be women.
• Additional 50 days allowed in:
  • Forest areas for ST households (Forest Rights Act, 2016).
  • Drought/natural calamity-affected areas (Section 3(4), MHA notified).
• Implementation done via Gram Panchayats; payment through Direct Benefit Transfer (DBT).
• MGNREGS promotes inclusive rural development, ecological regeneration, and self-reliance.

CURRENT  

• MGNREGS now brought under Monthly/Quarterly Expenditure Plan (MEP/QEP) unlike before.
• Violates its demand-driven character, crucial during lean agricultural periods or climate shocks.
• Demand peaks vary with crop cycles and weather—especially high in April-June, and post-monsoon.
• E.g., Karnataka in 2023 used over 70% of budget by August due to drought.
• Legal concerns: The Act gives statutory rights, not just scheme-based benefits.
• Cap may make it impossible to fulfill legal entitlement once 60% ceiling is reached.
• Courts (e.g., Swaraj Abhiyan v UoI) held financial constraints no excuse to deny legal rights.

MGNREGS & Gandhi’s Vision

• Reflects Gandhi’s philosophy of gram swaraj, rural upliftment, and dignity of labor.
• Encourages self-sufficiency, economic security, and community development.
• Alongside Swachh Bharat and Make in India, it operationalizes Gandhian ideals in policy.