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Can MGNREGA Provide Livelihood Relief In The COVID-Era?

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This post is a part of YKA’s dedicated coverage of the novel coronavirus outbreak and aims to present factual, reliable information. Read more.

MGNREGA has often been criticized for the delay in wage payment, non-payment of unemployment allowance, discrimination based on gender and caste, and the influence of local politics, etc. However, it can be a flagship program for labor-intensive work as a relief measure during the COVID pandemic if it is utilized to its full capacity. It can be used to build rural economies during the pandemic. This article explains the pitfalls of MGNREGA as a relief measure during the pandemic and how the Union Government can use this welfare policy as a flagship scheme to revive the rural economy.

MGNREGA has been crippled with drawbacks caused by administrative inefficiencies.


National Rural Employment Guarantee Act (NREGA) was enacted in 2005 which aimed to provide livelihood security to people in rural areas. It provided 100 days of guaranteed wage employment to households in a year. It was based on the need-based strategy to encourage grassroots development in deciding the kind of assets to build. As per the Act, Gram Sabha will recommend work to be taken up under NREGA and supervise the social audits and implementation of the scheme. It wanted to strengthen the rural governance and economy through decentralization, a strong social safety net, a time-bound guarantee of work, unemployment allowance, transparency, accountability, and implementation of right-based laws.

The scheme was renamed MGNREGA in 2009. Since 2009, MGNREGA has been operational in all the 625 districts (except for the districts with 100% urban population). The Act has empowered the rural population through its provisions like social audits and decentralized planning. The provision of Social Audit can be carried out by Civil Society Organisations (CSO). This has upheld the democratic right of the people to know about the audit of money spent in their name.

Nonetheless, it has been crippled with drawbacks due to its administrative inefficiencies. The villagers often don’t protest against the administrative inefficiencies because of a lack of awareness and are economically and politically powerless. It can still be used as a flagship scheme to provide safety nets to rural economies during the pandemic. Despite its pitfalls before and during the lockdown, it has the potential of a relief measure during the pandemic.

The Rising Demand For Work Under MGNREGA

The lockdown was imposed on 24 March 2020 and nearly one month later the Central Government released guidelines to resume MGNREGA work on 20 April 2020. The huge exodus of migrant workers back to their villages created the demand for MGNREGA work. The average demand for households for MGNREGA work from 2015-16 to 2019-20 was 42%. But the demand for work in 2020-21 increased to 51%. However, the households provided with work compared to the demand for employment was 87% in 2021-22 which fell slightly from 90% in 2015-16 (PRS Legislative Research, 2021).

According to the State Bank of India Research, demand for MGNREGA work has increased in April 2021 to 2.54 crore households (The Hindu, 2021). The continuum of demand for MGNREGA work increased as a result of the devastating second wave of COVID 19 which made it difficult for the migrant workers to return to the cities. The Union Government needs to increase its spending on MGNREGA. The Budget allocation for the financial year 2020-21 was Rs 61,500 crore. An additional Rs 40,000 crore was allocated to the scheme under the Atmanirbhar Bharat Package due to the distress migration as a result of the pandemic. The Budget 2021-22 allocated 73,000 crores for MGNREGA which is less than last year’s allocation. The second wave has made it difficult to sustain a livelihood. The allocation of funds needs to be increased to meet the demand for MGNREGA work or to compensate through the unemployment allowance.

MGNREGA Can Be Instrumental In Building Rural Economy During The Pandemic

MGNREGA has the potential to revive the rural economy. The rising demand for MGNREGA work during the pandemic has shown that it has acted as a lifeline for the rural economy. In FY 2021, despite its drawbacks, MGNREGA was able to provide work to 1.85 crore persons which is 52% higher than FY 2019 in the same period (PIB Delhi, 2021). This shows the relevance and importance of MGNREGA as a relief measure during these times of crisis. It will reap better results if the target is individuals as beneficiaries rather than households to make women and girl-child less vulnerable to intra-household discrimination and to accommodate the rising demand for work. Moreover, it will also increase employment opportunities in such difficult times.

There should also be an increase in the number of workdays to 200 and an increase in the pay scale. The spread of the virus in rural areas has become a reality. So, it is justified due to lack of employment opportunities as a result of the pandemic and it will guarantee them a sustained livelihood. Moreover, an increase in wages is important in tune with the large-scale inflation due to the pandemic as MGNREGA remains the only source of income for most of the workers.

Nevertheless, the flagship scheme has been crippled with criticisms ever since its implementation. The various criticisms like the delay of payment, non-payment of unemployment allowance, and lack of facilities like aya, drinking water, shelter, shade, and first aid can create more hurdles for workers in addition to the pandemic. These drawbacks and inefficiencies can become perilous in times of COVID 19. The difficulty in withdrawing money due to delays in payment leads to traveling to banks more than once. This leads to extra transportation costs and compromises the safety of the worker in the pandemic as a result of overcrowding in banks. Moreover, drinking water and first aid along with sanitary facilities in the worksites are prerequisites in the pandemic. These administrative inefficiencies need to be improved to protect the workers ‘Right To Work’ and ‘Right To Health’. MGNREGA can be really useful in building the rural economy if it is utilized properly.


MGNREGA is a right-based approach for wage employment that provides livelihood security in rural areas. This flagship scheme will be able to provide relief to people in the rural areas from extreme poverty and persisting unemployment as a result of the pandemic. “Right To Work” of the people as a human right needs to be protected in such devastating times of rampant unemployment. The Union Government needs to increase its allocation of funds for the year 2021-22 due to the rising demand for MGNREGA work. It’s also important to improve the administrative inefficiencies of the scheme so that it doesn’t become a strain for the workers in addition to the pandemic. The structural inequalities of the scheme need to be alleviated so that it doesn’t negate the small gains as a result of the ineffective implementation of the act.


The Hindu. (2021, April 30). Demand for MGNREGA work spikes. The Hindu,

PIB Delhi. (2021, May 17). Amidst the pandemic, India achieved new milestones in Rural Development. Ministry Of Rural Development, Government of India.

PRS Legislative Research. (2021). Demand for Grants 2021-22 Analysis: Rural Development. PRS Legislative Research.

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