New Delhi:  The government is expected to increase the budgetary allocation for the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) by more than Rs 5,000 crore in the upcoming 2024-25 full Budget.

According to an official, this substantial hike is anticipated due to an expected rise in demand for work under the scheme, driven by the government’s plan to construct an additional 20 million houses in rural areas under the Pradhan Mantri Awaas Yojana-Gramin (PMAY-G) over the next five years, reported FE.

In the interim Budget for 2024-25, the allocation for MGNREGS was set at Rs 86,000 crore, which was also the revised estimate for the previous year 2023-24.

However, the demand for work under the scheme witnessed a 10 per cent year-on-year decline in April, indicating a moderation in the initial months of the current fiscal year.

The official cited an internal assessment that anticipates a rise in demand for work, necessitating a higher budgetary allocation.

The MGNREGS, a demand-driven program, aims to provide at least 100 days of guaranteed wage employment in a financial year to every rural household whose adult members volunteer for unskilled manual work, primarily during off-seasons.

To address potential leakages, estimated to be around 30 per cent of annual spending, the government has implemented various measures.

From January 1, 2024, the Aadhaar-Based Payment System (ABPS) has been made mandatory for wage payments, linking workers’ Aadhaar numbers with their MGNREGS job cards and bank accounts.

Additionally, the adoption of Direct Benefit Transfer (DBT) has resulted in an estimated 10 per cent savings on wages due to the deletion of duplicate, fake, non-existent, and ineligible beneficiaries as of March 2022.