NREGS spending drops 5% in FY23

Spending under the government's flagship rural job guarantee scheme dropped 5% in 2022-23 from a year before, reflecting a moderation in demand with improved economic activities.

Expenditure under the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) in FY23 at ₹1.01 lakh crore still remained close to 12% higher than the Centre's actual fund release for the year, showed the data from the rural development ministry as of April 5.

The government released ₹90,373 crore for the scheme last fiscal against the revised estimate of ₹89,400 crore.


Given the carry-over funds from earlier years, the total availability of funds for expenditure under the scheme touched ₹1.06 lakh crore in FY23, data showed.

A senior government official said non-lapsable funds from earlier years are also taken into account while fixing the budgetary outlay and that the Centre is committed to allocate adequate funds to cater for any rise in demand.

Pronab Sen, former chairman of the National Statistical Commission, told ET that both enhanced economic activities and some supply-side issues may have caused the moderation in NREGS spending in the last fiscal year.

"As for FY24, expenditure under the scheme will be influenced by how agriculture sector performs," Sen said. "If it does well, demand for MGNREGS work will ease; if not, demand will rise again."

The government has budgeted ₹60,000 crore under the scheme for FY24, 18% lower than the budget estimate of ₹73,000 crore for FY23, but finance minister Nirmala Sitharaman has indicated that more funds would be allocated for the scheme if required.

Despite the year-on-year moderation, work generated under the scheme in FY23 remained higher than the pre-pandemic period.

Total person-days under MGNREGS in the last fiscal year stood at 2,930.4 million, down 19.3% from a year before, but up 10.4% from pre-pandemic year of FY20.

The person-days created in FY23 were also 2.7% higher than the initial target for the year (as reflected in the labour budget).

Officials said these are provisional data, which will be revised as and when updated data flow in.

Women accounted for 57.4% of the person-days in FY23, against 54.8% in FY22 and FY20.

As many as 87.5 million workers from 61.8 million households got work in FY23, compared with 106.1 million workers belonging to 72.5 million householders in the previous fiscal year.