Out of sync: Persistent mismatch between MGNREGA wage growth and inflation

The Parliamentary Standing Committee on Rural Development and Panchayati Raj has criticised the Centre for its failure to ensure daily wages under the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) keep pace with inflation.

 

An analysis of MGNREGA wage and inflation trends reveals a persistent mismatch between wage growth and inflation. Over the past few years, wage growth has consistently trailed both general and food inflation rates, with the exceptions of FY21 and FY24 (Chart 1). 

 

Another issue highlighted by the committee has been the disparity in wage rates across different states under MGNREGA. The data shows significant