MGNREGA Wage Increase: Adequate Support for Ground-Level Laborers?

The increase varied from Rs 7 in Uttar Pradesh (rising from Rs 230 in 2023 to Rs 237 in 2024) to a Rs 34 raise in Goa (increasing from Rs 322 in 2023 to Rs 356 in 2024).
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New Delhi - Ahead of the 2024 Lok Sabha polls, the central government has opted to implement a 3-10 percent increase in the wage rates for workers enrolled in the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGA) for the fiscal year 2024-25. It's noteworthy that these revised wage rates will be effective from April 1st.

According to the most recent government statistics for the fiscal year 2023-24, there were a total of 14.34 crore active workers.

However, the nationwide average days of employment provided per household stood at 51 days, falling short of the guaranteed promise of 100 days of work.

Allegedly, the hike in wages seldom reaches the workers on the ground.

The Mooknayak talked to Susheel Chandel, General Secretary of the Delhi Jal Board Sewer Department’s Mazdoor Sangathan. He explained that such hikes are regular news, but the main question is if the salary actually reaches the MGNREGA workers.

“This happens everywhere, but we never get the payment. Our workers still do not get paid on time, nor do they get benefits such as a provident fund.”

According to him, the main issue of the improper implementation of such hikes is contracts by private companies. They hire workers under contractual work and many times do not pay the salary to them.

Even the payment is not common for all the workers. Sanitation workers under the scheme are paid 9000-12,000, depending on the private company they are working under. The salaries are handed to them directly through cash, which reduces the scope of having a paper trail.

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According to him, one way through which this can be managed is by providing the workers contracts under Delhi state. Talking about Delhi Jal Board, he revealed that the sanitation workers there are employed by private players but if they came under the state, they would at least get paid regularly along with benefits.

The General Secretary also revealed that the sanitation workers in Northeastern Delhi are yet to receive salary in 2024, with many having received their last due in December 2023.

The Mooknayak had earlier reported on a similar situation regarding the sanitation workers of Burari Hospital, who were on strike against the contractual system with many claiming that the workers were being misbehaved and forcefully left out of work.

The hike that has been notified by the central government falls under the bracket of 3-10%, a number which has been questioned by the opposition leaders for being far too low.

Trinamool Congress spokesperson Saket Gokhale expressed strong disapproval, deeming it "shameful and shocking," that the wages for West Bengal, where the Trinamool government is engaged in a long standoff with the BJP-led Union government over graft allegations in implementing the Act, saw only a 5% increase.

Taking a swipe at the Narendra Modi government regarding the revised wages for MGNREGA workers, which vary from 3% to 10.5% for different states, including a Rs 7 hike for workers in Uttar Pradesh, senior Congress leader Rahul Gandhi sarcastically congratulated the workers on their "increased" salary.

In a post on X in Hindi, Mr. Gandhi wrote, "Congratulations to MGNREGA workers! The Prime Minister has increased your salary by Rs 7. Now he might ask you, 'What will you do with such a huge amount of money?'"

He suggested that the government could allocate Rs 700 crore for a "Thank You Modi campaign" for this hike.

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What is the Promised Hike?

Goa experienced the highest surge in wages compared to the previous year, with an increase of Rs 34 per day. Consequently, the daily wage under the Act rose to Rs 356 from last year's Rs 322, reflecting a notable 10.56% year-on-year rise.

Following closely behind were Karnataka, witnessing a Rs 33 per day hike, and Andhra Pradesh and Telangana, both seeing increments of Rs 28 per day. These states registered percentage increases of 10.44%, 10.29%, and 10.29% respectively, in contrast to the previous year.

On the other side, Uttar Pradesh, Uttarakhand, and Nagaland experienced the smallest increases in wages, with hikes of Rs 7 per day and Rs 10 per day respectively.

In terms of percentage, Uttar Pradesh and Uttarakhand displayed the lowest increments at 3.04% each, trailing Lakshadweep with a 3.62% rise.

The average wage across all states and Union Territories for the fiscal year 2024-25 is now approximately Rs 284 per day, up from around Rs 267 the previous year. These adjustments are based on changes in the agricultural labor dimension of the consumer price index (CPI-AL).

However, in February this year, the parliamentary standing committee on rural development and panchayati raj raised concerns, stating that revising wages based on CPI-AL values from 2010-11 doesn't accurately reflect current inflation and cost of living.

The committee recommended aligning MGNREGA wages with the expert committee's 2019 suggestion of a need-based minimum wage of Rs 375 per day.

The revised wages won't surpass Rs 374 per day for any administrative unit. Despite these adjustments, an analysis by The Hindu Businessline highlighted that MGNREGA daily wages remain notably lower than what agricultural laborers earn.

On average, MGNREGA wages were Rs 105 lower than daily wages for agricultural laborers in major states, except Gujarat, for FY 2023-24.

The largest gap was observed in Kerala, where the MGNREGA daily wage for FY 2023-24 stood at Rs 333, while the agricultural labor daily wage for men as of FY 2022-23 was Rs 764.3, marking a difference of Rs 431, according to Businessline figures.

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