As labourers return home after note ban, work demanded under MGNREGS up 60%

The Indian Express quoted an official as saying the note ban's impact on sectors may be the cause

The average daily demand for work under the flagship Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) in December recorded an increase of 60 per cent over the preceding few months, as migrant labourers reeling under the impact of demonetisation returned home due to en-masse closure of industries, The Indian Express reported on Monday.

The data, which the newspaper accessed exclusively, show that the average labourer turnout per day under MGNREGS between July and November 2016  was 3 million. In December, the average numbers went up to 5 million per day.

And, on January 7, 2017, the labour turnout for the day was as high as 8.360 million — approaching three times the daily pre-demonetisation average of 3 million.

A look at the MGNREGS website’s job demand pattern section shows that the spike in demand for work has, in fact, been a pattern in most of the previous years and, in 2016-17, the number of people demanding jobs under the scheme has seen an overall decline as compared to 2015-16 which could be attributed to a good monsoon and record kharif acreage, which has provided good on-farm jobs to people.

In 2015-16, according to the MGNREGS website, around 13.52 million people demanded jobs under the scheme in November, which went up to 18.77 million people demanding jobs under the scheme in December as farm work dried up.

In 2016-17, around 10.27 million people demanded work in November, which rose to 13.70 million in December.

However, on a week on week basis, there is a definite spike in work demanded under MGNREGS in the weeks in December as compared to the weeks in November in 2016-17.

In the first week of November, the number of person days of work demanded was around 25.6 million, which dropped to 10.6 million by the end of that month.

However, since December, there has been a rise in the number of person days of work demanded — from 13.46 million in the first week of December to 29 million after the second week and thereafter 30.9 million, 42.65 million and 35.79 million in the third, fourth and fifth weeks of the month, respectively.

Quoting unnamed officials in its report, the Indian Express said that December — by when much of the rabi sowing is over — usually registers a slight increase in demand, but never to the extent that was witnessed last month.

"MSMEs (micro, small and medium enterprises) and other sectors did get hit due to demonetisation. In such cases, the labourers go back to their villages and seek work under MGNREGA which is one of the main reasons for the increase," the report said, quoting one such unnamed official.

It also added that on November 7, the day before Prime Minister Narendra Modi’s demonetisation announcement, 3.82 million labourers sought work under MGNREGS.

The number fell slightly to 3.56 million on December 2, but thereafter rose through the month and in January, reached 7.89 million on Thursday and 8.36 million on Saturday.

"The last time MGNREGS numbers were higher was between April and June when the onset of the monsoon was delayed, and drought-like conditions were prevalent over many parts of India. The figures had then touched 10 million per day," the report said.

The report added that with more than 85 per cent of the Rs 47,500 crore outlay for MGNREGS this year being spent already, the Rural Development Ministry has demanded an additional Rs 8,000 crore from the finance ministry so that the scheme can run smoothly until the end of the current financial year.