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Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) of 2005

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This is a rural wage employment programme in India. It provides for a legal guarantee of at least 100 days of unskilled wage employment in a financial year to rural households whose adult members are willing to engage in unskilled manual work at a pre-determined minimum wage rate.

The objectives of the Act are:

MGNREGA was initially implemented as National Rural Employment Guarantee Act (NREGA) in 200 selected backward districts in India on February 2, 2006. It was extended to an additional 130 districts with effect from April 1, 2007. Later, the remaining 285 districts were covered from April 1, 2008. The National Rural Employment Guarantee (Amendment) Act, 2009 renamed NREGA as MGNREGA.

Section 4(1) of MGNREGA mandates the design and implementation of State-specific Rural Employment Guarantee Schemes (REGS) to give effect to the provisions made in MGNREGA. Section 6(1) empowers the Central Government to specify the wage rates for MGNREGA beneficiaries. So far, the wage rates have been modified three times, the latest being on January 14, 2011 where the base minimum wage rate of Rs. 100 was indexed to inflation.

MGNREGA is unique in not only ensuring at least 100 days of employment to the willing unskilled workers, but also in ensuring an enforceable commitment on the implementing machinery i.e., the State Governments, and providing a bargaining power to the labourers. The failure of provision for employment within 15 days of the receipt of job application from a prospective household will result in the payment of unemployment allowance to the job seekers.

The implementation of MGNREGA largely depends on the active participation of three-tier decentralized self governance units called Panchayat institutions. The panchayats are required to estimate labour demand, identify works and demarcate work sites, prioritize works, prepare village/block/district level development plans in advance for the continuous and smooth planning and the execution of this wage employment programme. The Panchayats are responsible for processing the registration of job seekers, issuance of job cards, receipts of applications for employment, allotment of jobs, identification of work sites, planning, allocation and execution of works, payment of wages and commencement of social audit, transparency and accountability check at the grass-root level.

The implementation of MGNREGA has influenced the wage structure in rural areas as the minimum wages for agricultural labourers across States have witnessed an upward trend between 2006 and 2010. The Act has broadened the occupational choices available to the agricultural workers within their locality, thereby impacting rural-urban migration.

Budget provision hovered around 40,000-50000 under this programme. The report card on Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) on the completion of ten years of its implementation on 2nd February 2016, may be seen from the official press release of Ministry of Rural Development on 1 February 2016.

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