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Indian Express
6 days ago
- Business
- Indian Express
MGNREGS: a social security scheme you must know for UPSC Exam
Take a look at the essential events, concepts, terms, quotes, or phenomena every day and brush up your knowledge. Here's your knowledge nugget for today on MGNREGS. (Relevance: Government policies and schemes are an important part of the UPSC CSE syllabus, and previous years' questions highlight their significance. In this regard, knowing about the schemes that are in the news becomes important for the UPSC exam.) The Union Finance Ministry has capped spending under the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) at 60% of its annual allocation for the first half of Financial Year (FY) 2025-26. There was no such spending limit until now. Civil society groups and MGNREGS worker unions have raised concerns about the move. In this context, let's know about the MGNREGS and concerns associated with spending limit. 1. MGNREGS is the world's largest social security programme aimed at enhancing livelihood security and reducing rural poverty. It is based on the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA, 2005). 2. The MGNREGA recognises employment as a statutory right. The Act signified a critical shift from this being a negative right under Article 21 of the Constitution (which mandated that the state must not interfere with your livelihood unreasonably) to a positive statutory obligation on the government to provide employment on demand. 3. It guarantees 100 days of employment in a year to rural households whose adult members volunteer to do unskilled manual work. 4. The act provides a legally-backed guarantee for any rural adult to get work within 15 days of demanding it; thereby serving as an effective social safety net during times of economic distress. Moreover, at least one third of MGNREGA beneficiaries have to be women. 5. Notably, while Section 3 (1) of the MGNREGA provides for 'not less than one hundred days' work per rural household in a financial year, it has become de facto upper limit as the NREGA software does not allow data entries for employment above 100 days to a household in a financial year unless specifically requested by the state/Union Territory. 6. However, in some cases, the government allows an additional 50 days of wage employment (beyond the stipulated 100 days). For instance, every Scheduled Tribe household in a forest area is entitled to get 150 days' work under MGNREGS, provided that such families have no other private property except for the land rights granted under the Forest Right Act, 2016. 7. Besides, the government, under Section 3(4) of the MGNREGA, can also provide an additional 50 days of unskilled manual work in a financial year, over and above the 100-day limit in rural areas where a drought or any natural calamity (as per the Ministry of Home Affairs) has been notified. 1. The MGNREGS has been brought under the Monthly Expenditure Plan/Quarterly Expenditure Plan (MEP/QEP), a spending control mechanism introduced by the Finance Ministry in 2017. MGNREGS was thus far exempt from MEP/QEP on account of being demand-driven. 2. There are some issues with this expenditure cap, such as: (i) Issue of fluctuating demand: By design, MGNREGS acts as a buffer for rural citizens, especially during times of lean harvests, freak weather events, and rural distress. Work demand under the scheme fluctuates throughout the year due to a number of reasons, primarily agricultural activities and weather patterns. MGNREGS work demand is highest between April and June, and picks up again after the kharif sowing season in September. But weather abnormalities such as delayed rains can lead to high MGNREGS work demand even in July or August. In 2023, for instance, low rainfall led to 20% higher work demand than usual in July and August, with Karnataka in particular spending more than 70% of the annual MGNREGS budget within six months due to extreme drought conditions. The expenditure cap does not take into account these contingencies. (ii) Question of legality: There is also a legal issue. Social security and welfare in India is implemented either via schemes designed and executed by the government of the day (for instance, PM Kisan Samman Nidhi or the LPG scheme), or through schemes based on specific legislation which establish certain programmes as statutory rights, like MGNREGS (based on MGNREG Act, 2005) or the Public Distribution System (based on National Food Security Act, 2013). The former can, and often are, altered, discontinued, or repackaged when a new government comes to power. For the latter, while the government does have the power to determine the modalities of implementing legislation, this power is conferred by the legislature and is limited in its scope. The 60% spending cap ordered by the Finance Ministry makes it virtually impossible to realise an entitlement that is legally guaranteed under the MGNREGA once the ceiling is reached. Over the past years, both central and state governments have undertaken various projects, schemes, regulations, and acts to fulfil the vision of Mahatma Gandhi. Let's know how MGNREGA, Swachh Bharat Mission and Make in India embody Gandhi's philosophy. 1. Swachh Bharat Mission: Mahatma Gandhi emphasised on swachhta as which ensures healthy life and society. For Gandhi, the drive for cleanliness in society was an integral part of the process in bringing about a casteless and free society. 'Everyone is his own scavenger,' said Gandhi, reiterating the fact that the need for making cleanliness a personal responsibility was key to removing untouchability. Sanitation was also considered a necessity by Gandhi in order to remove the label attached to Indians being in need for the West's civilising mission. Swaraj can only be had by clean, brave people,' wrote Gandhi in an article titled 'Our insanitation'. Keeping this in mind, the Indian government launched the Swachh Bharat Mission on October 2, 2014. The mission covers all rural and urban areas. The urban component of the mission is implemented by the Ministry of Housing and Urban Affairs, and the rural component by the Ministry of Drinking Water and Sanitation. 2. MGNREGA: It embodies Gandhi's belief in uplifting rural areas. This flagship programme provides economic security to rural households and enhances their purchasing power through promoting self-sufficiency in villages. in India: Gandhi spoke about 'swadeshi' during the freedom struggle. Today, in the era of globalization, the 'Make In India' initiative by the government aims to boost manufacturing in India and establish the country as a global manufacturing hub. This initiative is based on Gandhi's idea of self-reliance and swadeshi. Government schemes, from cleanliness to food security, education, and universal banking, are all in the spirit of Gandhi. POST READ QUESTION Consider the following statements regarding Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS): 1. The government has capped spending under the MGNREGS at 60 per cent of its annual allocation for the first half of the financial year 2025–26. 2. The Finance Ministry has directed the Ministry of Rural Development (MoRD) to include MGNREGS under the Monthly/Quarterly Expenditure Plan (MEP/QEP) framework. 3. Till now, the scheme has operated as a demand-driven programme with 40 per cent mandatory capping on the spending limit. How many of the statements given above are correct? (a) Only one (b) Only two (c) All three (d) None (Sources: MGNREGS demand down from pandemic peak, Explained: Centre's rationale behind MGNREGS spending cap, the problems with it, UPSC Issue at a Glance | Gandhi's Philosophy in Constitution and Government Policies) Subscribe to our UPSC newsletter. Stay updated with the latest UPSC articles by joining our Telegram channel – Indian Express UPSC Hub, and follow us on Instagram and X. 🚨 Click Here to read the UPSC Essentials magazine for May 2025. Share your views and suggestions in the comment box or at Roshni Yadav is a Deputy Copy Editor with The Indian Express. She is an alumna of the University of Delhi and Jawaharlal Nehru University, where she pursued her graduation and post-graduation in Political Science. She has over five years of work experience in ed-tech and media. At The Indian Express, she writes for the UPSC section. Her interests lie in national and international affairs, governance, economy, and social issues. You can contact her via email: ... Read More
Indian Express
15-06-2025
- Business
- Indian Express
Explained: Centre's rationale behind MGNREGS spending cap, the problems with it
Second byline: Purbayan Chakraborty The Union Finance Ministry has capped spending under the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) at 60% of its annual allocation for the first half of Financial Year (FY) 2025-26. There was no such spending limit until now. The programme has been brought under the Monthly Expenditure Plan/Quarterly Expenditure Plan (MEP/QEP), a spending control mechanism introduced by the Finance Ministry in 2017. MGNREGS, which provides up to 100 days of employment to any rural household on demand, was thus far exempt from MEP/QEP on account of being demand-driven. Civil society groups and MGNREGS worker unions have raised concerns about the move. Here's why. Finance Ministry's rationale MGNREGS has long been plagued with financial troubles, which are perhaps what the Finance Ministry hopes to address by implementing the MEP/QEP mechanisms. Data from the Ministry of Rural Development show that over the last few years, more than 70% of the budget is frequently exhausted by September, and while supplementary allocations are often made in December, even these run out by January. This leaves significant pending dues by the end of the FY — over the last five FYs, pending dues have ranged between Rs 15,000 crore to Rs 25,000 crore. On average, 20% of the subsequent FY's budget is spent in clearing these. By implementing an expenditure cap, the Finance Ministry is likely ensuring an adequate budget will remain for the latter half of the FY, so that no supplementary allocation will have to be made. The MGNREGS budget for FY 26 stands at Rs 86,000 crore, and FY 25 ended with pending dues of Rs 21,000 crore. As on June 12, the Centre has released 28% of FY 25-26's budget. Pending dues for FY 26 stand at Rs. 3,262 crore, and for FY 25 at Rs 19,200 crore. Just clearing these dues will exhaust approximately 50% of the budget. Issue of fluctuating demand By design, MGNREGS acts as a buffer for rural citizens, especially during times of lean harvests, freak weather events, and rural distress. Work demand under the scheme fluctuates throughout the year due to a number of reasons, primarily agricultural activities and weather patterns. MGNREGS work demand is highest between April and June, and picks up again after the kharif sowing season in September. But weather abnormalities such as delayed rains can lead to high MGNREGS work demand even in July or August. In 2023, for instance, low rainfall led to 20% higher work demand than usual in July and August, with Karnataka in particular spending more than 70% of the annual MGNREGS budget within six months due to extreme drought conditions. The expenditure cap does not take into account these contingencies. There is a legal issue too. Social security and welfare in India is implemented either via schemes designed and executed by the government of the day (for instance, PM Kisan Samman Nidhi or the LPG scheme), or through schemes based on specific legislation which establish certain programmes as statutory rights, like MGNREGS (based on MGNREG Act, 2005) or the Public Distribution System (based on National Food Security Act, 2013). The former can, and often are, altered, discontinued, or repackaged when a new government comes to power. For the latter, while the government does have the power to determine the modalities of implementing legislation, this power is conferred by the legislature and is limited in its scope. The MGNREGA recognises employment as a statutory right. The Act signified a critical shift from this being a negative right under Article 21 of the Constitution (which mandated that the state must not interfere with your livelihood unreasonably), to a positive statutory obligation on the government to provide employment on demand. The 60% spending cap ordered by the Finance Ministry makes it virtually impossible to realise an entitlement that is legally guaranteed under the Act once the ceiling is reached. Constitutional courts have held that financial inability cannot be a reason to disregard statutory or constitutional duties, including in Swaraj Abhiyan v Union of India (2016), Municipal Council, Ratlam vs Shri Vardhichand (1980), and Paschim Banga Khet Mazdoor Samity v State of W.B. (1996). Lack of clarity There is currently no clarity on what will happen once the ceiling is reached. States could be forced to deny employment even when there is demand, or workers may have to work without timely payment. In both scenarios, statutory rights of the workers may be violated — the right to to receive employment within 15 days of raising the demand, as provided under section 3 of the MGNREGA, and the right to receive wages within 15 days of closure of work, as mandated under para 29 of schedule II of Act. To be sure, wage delays have been rampant in the scheme for years, and unemployment allowances and compensation for delayed payments have gone unpaid or been poorly calculated (as the Supreme Court has observed). However, the Finance Ministry's decision undermines the letter and spirit of the Act in an attempt to address the financial problems in MGNREGS. Laavanya Tamang is Senior Researcher with the Foundation for Responsive Governance, and affiliated with the NREGA Sangharsh Morcha. Purbayan Chakraborty is a Calcutta-based lawyer and works closely with the Paschim Banga Khet Majoor Samity, a trade union representing rural workers in West Bengal. All data accessed from MGNREGS MIS on June 12
The Hindu
11-06-2025
- Business
- The Hindu
From The Hindu, June 12, 1975: Proposals to attract remittances from Indians abroad
New Delhi, June 11: The Union Finance Ministry is examining the feasibility of making it obligatory for Indians taking jobs abroad to remit to the country a certain proportion (about 10 per cent) of their earnings every year. The remittances may be made either to their relatives in the country or credited to a bank account maintained in India. This is among the three proposals which the Reserve Bank of India has been asked to examine in detail and comment upon. The other proposals are: (i) The feasibility of permitting non-resident Indians living abroad to maintain bank accounts in India in the unit of a convertible foreign currency, either the pound sterling or the dollar and (ii) permitting them to invest in company shares in India. The Reserve Bank is already stated to have commented on these proposals in detail. The contents of its note to the Finance Ministry are not known, but they seem to be by and large favourable. The Finance Ministry was prompted to consider the question of permitting non-resident Indians living abroad to keep their remittances to India in the unit of account of a foreign currency to protect their savings from any erosion on account of the fall in the rupee value. Under the existing banking laws, this is not permissible.
Time of India
06-06-2025
- Business
- Time of India
Thief or no thief? What cases say about Vijay Mallya
Fugitive billionaire Vijay Mallya , accused of defaulting on bank loans, has made an elaborate show of contrition. Appearing on a four-hour podcast, Mallya, who is living in the UK, apologised for the downfall of his Kingfisher Airlines . Accepting responsibility for the collapse of the airline, Mallya said, "I apologise to everyone for the failure of Kingfisher Airlines ." But he also asserted that he is not a thief. Responding to charges of financial wrongdoing, Mallya said, "You may call me a fugitive, but I didn't run away. I flew on a prescheduled visit. Fair enough, I didn't return for reasons that I consider are valid… so if you want to call me a fugitive, go ahead. But where is the 'chor' (thief) coming from? Where is the 'chori' (theft)?" During the podcast, he also expressed willingness to consider returning to India under specific conditions. "If I have a fair assurance of a fair trail and dignified existence in India, I will think about it (returning to India) seriously." Mallya said the money he owed to banks has been recovered several times over from him. Industrialist Harsh Goenka has come to Mallya's defence. Responding to what Mallya said in the podcast, Goenka wrote on X: "Vijay Mallya lived the high life, yes. Defaulted, yes. Unlike most others, his Rs 9,000+ crore dues are now reportedly settled. Meanwhile, bigger defaulters walk free with much fatter haircuts from banks. If dues remain, the banks should clearly say so. If not, why is he still a political punching bag? Justice must be fair, not selective." "Thank you Harsh," Mallya responded on X. "The Union Finance Ministry has confirmed in writing that Banks have recovered Rs 14,100 crores from me against a DRT judgement debt of Rs 6,203 crores. Why the blatant discrimination?" Live Events Mallya owes Indian banks approximately Rs 9,000 crore. He fled India in 2016 and has been residing in the UK since then. In December last year, Finance Minister Nirmala Sitharaman informed Lok Sabha that the Enforcement Directorate (ED) had so far restituted Rs 14,000 crore worth of assets to various banks from the sale of Mallya's assets. What the cases against Mallya say Mallya may believe that he is not a thief and also appear to be a victim instead of a perpetrator, but there is certainly far more to the cases against him than simply a matter of repayment of outstanding loan. Investigating agencies have accused Mallya of criminal conspiracy, fraud and money laundering on several counts. Bank officials were also arrested in the Kingfisher Airlines case. Below are the main cases against Mallya: Loan default and fraud Rs 6,900 crore loan default: In 2016, the Central Bureau of Investigation (CBI) filed a case against Mallya and Kingfisher Airlines for allegedly defaulting on loans amounting to Rs 6,900 crore from a consortium of 17 public sector banks. The charges include criminal conspiracy and cheating under the Indian Penal Code (IPC). Rs 900 crore IDBI Bank loan: In 2017, the CBI charged Mallya and others in a Rs 900 crore loan default case involving IDBI Bank. The charges include criminal conspiracy, cheating, and corruption. The agency alleged that the loan was granted without proper procedures, resulting in a loss of public funds. Rs 180 crore Indian Overseas Bank loan: In 2024, a special CBI court issued a non-bailable warrant against Mallya in connection with a Rs 180 crore loan default case involving Indian Overseas Bank. The CBI alleges that Mallya caused a wrongful loss to the bank by willfully defaulting on the loan. Money laundering Enforcement Directorate (ED) case: The ED has charged Mallya under the Prevention of Money Laundering Act (PMLA). The agency alleges that Kingfisher Airlines diverted at least Rs 3,547 crore of the loan received from banks. Instances of alleged diversion include over-invoicing of aircraft lease rentals, payments for a corporate jet used exclusively by Mallya, and transfers to the Force India Formula One team and the Royal Challengers Bangalore IPL team. Service tax evasion Rs 100 crore service tax default: In 2012 and 2015, the service tax department filed complaints against Kingfisher Airlines for non-payment of over Rs 100 crore in service tax, despite collecting this amount from passengers. A Mumbai court issued non-bailable warrants against Mallya and others in connection with this case. Corporate misgovernance and fraud Serious Fraud Investigation Office (SFIO) case: In July 2016, the SFIO issued notices to 17 companies for taking loans from banks to finance the defunct Kingfisher Airlines. The investigation uncovered instances of corporate misgovernance and financial irregularities. Mallya's accusation of recovering debt "multiple times over" In February this year, Mallya moved the Karnataka high court challenging the debt recovery proceedings against him. In his petition, Mallya sought a statement by the banks of accounts for the amounts owed by him to United Breweries Holdings Limited (in liquidation) and other certificate debtors. It was submitted that the amount due had already been recovered, and even still additional recovery proceedings had been carried out against Mallya. "Parallelly there was a debt recovery proceeding, in that a sum of Rs 6200 crore was ordered to be paid by the primary debtor Kingfisher and the UBHL which was the guarantor. That order also attained finality," Mallya's advocate said. "However, between 2017 the Rs 6200 crore was recovered multiple times over and there is an admitted statement which I have filed, as on date, the recovery officer says Rs 10,200 crore has been recovered. While the official liquidator says banks have made their money restored. Lastly a statement is made in the Parliament by the Finance Minister that 14,000 crore is recovered," he added. (With TOI inputs)
India.com
06-06-2025
- Business
- India.com
This Indian billionaire publicly supports Vijay Mallya, calls former RCB and Kingfisher owner a ‘punching bag', his name is..
Vijay Mallya, who is facing fraud and money laundering charges had interacted with podcaster Raj Shamani recently. He spoke on all the topics he talked about for many years. The discussion about his podcast started surfacing on social media platforms this morning. While replying to Harsh Goenka's post Vijay Mallya claimed that the banks had recovered Rs 14,100 crores from him. In his post, Mallya thanked Goenka for speaking in his favour and added that he has been facing 'blatant discrimination'. Harsh Goenka's Post On Vijay Mallya Taking a part in ongoing discussion, Chairman of RPG Enterprises, Harsh Goenka stated, '' Vijay Mallya lived the high life, yes. Defaulted, yes. Unlike most others, his ₹9,000+ crore dues are now reportedly settled. Meanwhile, bigger defaulters walk free with much fatter haircuts from banks. If dues remain, the banks should clearly say so. If not, why is he still a political punching bag? Justice must be fair, not selective.'' Thank you Harsh. The Union Finance Ministry has confirmed in writing that Banks have recovered Rs 14,100 crores from me against a DRT judgement debt of Rs 6,203 crores. Why the blatant discrimination ? — Vijay Mallya (@TheVijayMallya) June 5, 2025 Vijay Mallya's Reaction On Post The former owner of Kingfisher Airlines and Royal Challengers Bengaluru (RCB) wrote, '' Thank you Harsh. The Union Finance Ministry has confirmed in writing that Banks have recovered Rs 14,100 crores from me against a DRT judgement debt of Rs 6,203 crores. Why the blatant discrimination ?'' On this, Goenka responded with a folded hands emoticon. Netizens Reaction On Discussion User name Gargi Rawat said, '' This is true sir. But as you stated, he's a political punching bag.'' Another user named as Mahesh Poddar said, ''We often forget he created world class airline KINGFISHER in no time. Many airlines failed like this too. Appreciate your public stance.'' Disagreeing with them another user named Balkrishnan B R said, ''Just to remind you, Vijay Mallya is also walking free and still living the high life in the UK. UK is a safe haven for all our criminals.''
