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NREGA – National Rural Employment Guarantee Act

Last Update Date : April 04, 2019
Estimated Read Time: 5 min

NREGA Scheme

NREGA is an acronym of National Rural Employment Guarantee Act, which was notified in 2005 and was launched in 2006. It was later renamed as Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) in 2009.

What is NREGA?

NREGA or MGNREGA, as it is known now, is a social security measure and an Indian law whose aim is to guarantee the ‘right to work’ in the rural areas. NREGA was a flagship programme of the UPA government when it was in power, which was implemented to directly touch the lives of the poor people and promote internal growth.

This Act aims to enhance the security of the livelihood of people living in rural areas. Therefore, the government aims to provide at least 100 days of wage employment to every household in a financial year who had adult members who could volunteer to undertake unskilled manual work.

NREGA can also help in protecting the environment, reducing the rural to urban migration, empowering the women of rural areas and fostering social equities apart from providing security economically and creating rural assets.

The law also provides different safeguard options for promoting its effective implementation and management.

What are the Objectives of NREGA?

As the name suggests, the Act guarantees to provide employment to the people living in the rural areas.

The main objectives of this Act are as follows:

  1. Augmentation of wage employment
  2. To strengthen the management of natural resources by works that will address the causes of chronic poverty like deforestation and drought
  3. To strengthen the process of democracy
  4. To infuse accountability and transparency in the governance
    5. To give an important role to the Panchayati Raj Institutions for planning, implementing and monitoring in order to strengthen decentralisation and deepening the process of democracy

What are the Unique Features of NREGA?

In order to complete the objectives of NREGA, unique features have been put in place. These key features are:

  1. Works that are undertaken in the Scheme will be in the rural areas, and the priority should be given to the women so that at least one-third beneficiaries are women who have requested and registered for work. After the work has been done for the day, every person who has done the given work will receive wages as per the wage rate decided.
  2. As far as the wage rates are concerned, the rate shall not be less than Rs 65 per day. Also, the wages should be given on a weekly basis and should not be delayed for more than a fortnight. In case an applicant has not received employment within 15 days of receiving his application he will be entitled to Daily Unemployment Allowance.
  3. At the time of application, the applicant should receive employment within the radius of 5 km of the village where he stays, or it should be within the block where the labourers shall be paid 10% extra for meeting their travelling and living expenses.
  4. The workers should also be provided with all the necessary amenities such as drinking water, medical aid, shade as well as creches if there are children below 5 years present at the site of the work.
  5. Social Audit shall be conducted, at least once in every six months, by the State Government for the works undertaken in the scheme of every Gram Panchayat.

How is NREGA Implemented?

After understanding the objectives and features of the scheme, we will now read how the Act is implemented in rural areas.

  1. The cost of the scheme is shared by the Central Government as well as the State Government in the ratio of 3:1.
  2. All the adult members in the rural households need to submit their name, age and their address along with their photo to the Gram Panchayat.
  3. After the submission of the documents, the Gram Panchayat shall register the household after making the necessary enquiries and then issue the job card to the applicant. This job card contains the details of the applicant who has enrolled himself in the scheme and his photo.
  4. The application for work can be submitted for work in writing for at least 14 days of continuous work to either the Panchayat or the Programme officer.
  5. The respective authority will then accept the application which they feel is valid and then issue a dated receipt of the application. They will send the letter providing work to the applicant which will also be displayed at the Gram Panchayat Office.
  6. If the work provided to the applicant exceeds the radius of 5 km from the place where he stays, an extra wage is to be paid to them. Daily Unemployment Allowance is to be paid to the applicants who haven’t received any work within 15 days of the receipt of the application.

How Monitoring & Evaluation is done in NREGA?

  1. To see if the work is being done effectively and that the NREGA scheme isn’t being misused, the Ministry has set up a comprehensive system for monitoring. In order to achieve effective monitoring of projects, 100% verification of the work at the Block level, 10% verification at District level and 2% again at the State level. These inspections are needed to be undertaken for ensuring that the work is smooth and effective.
  2. The Ministry has also set up a Task Force for optimising the NREGA effects in multiples to look at the possibility of convergence of different programmes such as National Horticulture Mission, Bharat Nirman, Watershed Development, Rashtriya Krishi Vikas Yojana with NREGA. These efforts of the convergence will add value to the NREGA Act and their works and also help in creating durable efforts while enabling planned as well as coordinated public investments in the rural areas.

Implementation Funding of NREGA

The funding of works and their implementation under the NREGA act are taken care of by the Central as well as State Government.

The activities that they fund for are explained as follows:

Central Government

The Central Government funds NREGA for the activities given below:

  1. 100% of wages for unskilled workers
  2. 75% of the cost of wages, materials, and of skilled and semi-skilled labour
  3. Central employment guarantee council expenses
  4. Central Government determines administrative expenses

State Government

The funds established by the State Government is called as State Employment Guarantee Fund under NREGA Scheme. The State Governments funds the activities explained below:

  1. If the State Government cannot provide wage employment on time, it has to provide unemployment wages
  2. 25% cost of wages, materials, and of skilled and semi-skilled labour
  3. State employment guarantee council expenses

The Act has been introduced to empower poor people in the rural areas who want to but are unable to get work due to numerous unavoidable reasons. NREGA scheme has been put in place to provide employment opportunities for people who are living in rural areas, especially women, thereby increasing the employment rate of the rural area and the country.

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CA Madhuri Marne
Madhuri is a tax expert at H&R Block (India) with over a decade of professional experience. Having co-authored a book on economics for the ICAI exam, she now enjoys writing about tax-related topics in a simple and easy manner. Outside of work, Madhuri is passionate about teaching students who are appearing for professional exams.

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