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MGNREGA's Aadhaar-Based Payment System faces criticism, affecting 27% of workers, with funds withheld in West Bengal, calls for urgent action.

Scrutiny on MGNREGA Aadhaar Payment System

A new report finds 27% of MGNREGA workers ineligible for Aadhaar-Based Payments, urging restoration of withheld funds in West Bengal.

MGNREGA's Aadhaar-Based Payment System faces criticism

A recent report highlights challenges in MGNREGA's Aadhaar payment system, affecting 27% of workers, with funds withheld in West Bengal.

Around 27 percent of all MGNREGA workers and 1.5 percent of active workers are still ineligible for the Aadhaar-based payment system (ABPS), a new report said, as it also dismissed the government&rsquo;s claim that it is more efficient than the bank account-based payment system.
In a report released earlier this week, Libtech India, a consortium of academics and activists, also recommended that MGNREGA funds be urgently restored in West Bengal, which the Union government has stalled for more than three years.
ABPS, a mechanism to electronically transfer wages and subsidies to an Aadhaar-linked bank account that is mapped with the National Payments Corporation of India(NPCI) mapper, was made mandatory under the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) in January 2024.
The BJP-led government at the Centre and the TMC government in West Bengal have repeatedly tussled over the issue.
The central government has said ABPS was introduced to ensure timely payment of wages to the beneficiaries under MGNREGA and has claimed that there were irregularities in utilisation of funds released before March 2022.
In a written reply in Lok Sabha during the recent Budget Session, Minister of State for Rural Development Kamlesh Paswan said ABPS addresses the issues arising due to frequent changes in bank account numbers of the beneficiaries.
The Rural Development Ministry has said release of funds under MGNREGA has been stopped since March 9, 2022 as per provision of Section 27 of MNREGA law "due to non-compliance of directives of central government".
The report by Libtech India said on April 8, 2024, around 31 per cent of all workers and 8 per cent of active workers were ineligible for ABPS. The situation improved only marginally in 2025, and as of April 7, 2025, 27.5 per cent among all workers and 1.5 per cent among active workers are still ineligible for ABPS.
The report said though the Rural Development Ministry has stated that ABPS ineligibility will not lead to loss of work, field insights from 200 cases across 10 states inform that workers ineligible for ABPS are not provided work by frontline officials, fearing non-payment of wages which denied them their "right to work".
At state level, while Maharashtra followed by Gujarat and Jharkhand have the highest number of all workers ineligible for ABPS, West Bengal, Bihar and Punjab have the highest 'active' workers being ineligible, the report said.
According to the Rural Development Ministry website, 15.21 crore job cards have been issued under MGNREGA so far, and there are 26.21 crore workers in total. The number of 'active' job cards is 8.3 crore while the number of 'active' workers is 11.83 crores.
The report also expressed concern over the budget for the scheme, and said various studies in the past have established budget cuts and wage payment delays to play a significant role in the overall employment drop.
It also said the People&rsquo;s Action for Employment Guarantee (PAEG) has recommended a budget allocation of 2.64 lakh crores for MGNREGA for 2022-23, however, the Union government allocated only Rs 86,000 crores for 2024-25.
The report said despite an 8.6 per cent rise in registered households under MGNREGA in 2024&ndash;25, employment indicators point to a concerning decline, and said the person-days generated dropped by 7.1 per cent, average days of employment per household fell by 4.3 per cent, and only 7 per cent of households completed the full 100 days.
It also pointed out that there was no employment generated for West Bengal in 2023-24 and 2024-25, since funds for the state have been stalled by the Union government since March 2022 with the invocation of Section 27 of MGNREGS 2005.
The report also said that the trend of high deletions of MGNREGA workers was reversed in 2024-25 for the first time after 2022-23, and more job cards and workers were added than deleted.
The Centre has said that MGNREGA funds have not been released to the West Bengal as per provisions of Section 27 of Mahatma Gandhi National Rural Employment Guarantee Act, 2005 and has alleged irregularities in the implementation of the scheme.
The Rural Development Ministry has also alleged non-compliance of directives of the central government.
Under the Section 27 of the Act, the central government can "order stoppage of release of funds to the Scheme" on receiving a complaint of improper utilisation of funds.
The Calcutta High Court, while hearing petitions demanding that beneficiaries be paid for work already completed under the scheme, observed last month that the Act does not allow for indefinite suspension of the scheme&rsquo;s implementation due to complaints.

Cricketer Mohammed Shami's relatives are involved in an MNREGA fraud investigation in Amroha, Uttar Pradesh. 18 individuals, including family members, are accused of improper wage claims. Legal actions are underway.

Mohammed Shami's Relatives Involved in MNREGA Fraud

A significant MNREGA fraud sees Mohammed Shami's relatives entangled. The district probe unveils improper wage claims and initiates serious legal actions against the accused in Amroha, spotlighting governance issues.

Mohammed Shami's kin entangled in MNREGA fraud probe

Relatives of Mohammed Shami face MNREGA fraud allegations in Amroha. The probe reveals improper wage claims by 18 individuals. Legal actions initiated, with steps to recover funds and examine deeper involvement.

A district-level investigation into an alleged fraud involving Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA) has implicated several individuals, including relatives of Indian cricketer Mohammed Shami, officials said on Wednesday.
District Magistrate (DM) Nidhi Gupta Vats announced late Wednesday evening that a preliminary investigation confirmed the allegations of fraudulent MNREGA wage disbursement in Amroha (Uttar Pradesh). Consequently, orders have been issued to suspend implicated workers listed as workers with MNREGA, register a formal police report and initiate departmental action under the Panchayati Raj Act.
"The investigation by local officials revealed that 18 individuals received MNREGA wages without performing any work. Among those implicated include Mohammed Shami's sister Shabina, Shabina's husband Ghaznavi, Shabina's three brothers-in-law Aamir Suhail, Nasruddin and Shekhu, along with sons and daughters of village head Gule Ayesha," informed the DM.
Gule Ayesha, the mother-in-law of Mohammed Shami's sister and current village head of Amroha, is at the centre of this scandal.
The fraudulent entries were registered in the MNREGA job cards in January 2021 and the individuals received wages in their bank accounts until August 2024-25 without performing any labour, the officer added.
The DM also directed the recovery of the misappropriated funds and the seizure of the Gram Pradhan's accounts.
The investigation was launched following recent media reports about the fraud. Initial investigations point to the involvement of the then Village Development Officer (VDO), Assistant Programme Officer (APO), operator, Gram Pradhan and individuals close to the Gram Pradhan. Further investigations are underway.

Demand for work under MGNREGS hits a 23-month high in June, with 3.37 crore households seeking employment due to a weak rural recovery 

Rural employment demand soars: MGNREGS hits 23-month high in June

Demand for work under MGNREGS hits a 23-month high in June, with 3.37 crore households seeking employment due to a weak rural recovery&nbsp;

Demand for work under the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) reached a 23-month high in June, according to a recent report by Business Standard. The report revealed that approximately 3.37 crore households, sought to avail the benefits of the scheme.
This surge in demand can be attributed to the inadequate rainfall experienced during the early southwest monsoon season and the overall weakness in rural recovery, which has intensified the need for employment opportunities. Such circumstances have driven more households to turn to the MGNREGS for livelihood support.
The last instances when the number of households utilizing the MGNREGS exceeded 3 crore were amid the covid pandemic in May 2020, with 3.3 crore households, and in June 2020, with 3.89 crore households, as reported by Indian Express.
The Mahatma Gandhi National Rural Employment Guarantee Scheme is a flagship initiative aimed at improving the livelihood security of rural households. It offers a minimum of 100 days of guaranteed wage employment in a financial year to households whose adult members willingly engage in unskilled manual labor.
The Department of Economic Affairs under the Ministry of Finance, in its monthly review report on July 6, stated that an increase in the minimum support price (MSP) for rabi and kharif crops, a rise in the fair and remunerative price (FRP) for sugarcane, and an elevation in the MGNREGS wage rate are expected to enhance the financial stability of rural households and stimulate rural demand.
Simultaneously, the Ministry of Rural Development urged states to organize camps and diligently follow up with beneficiaries to ensure 100% coverage under the mandatory Aadhaar-based payment system (ABPS). While beneficiaries are requested to provide their Aadhaar number, work should not be denied to those without one.
With the demand for work under the MGNREGS reaching a 23-month high, it is evident that rural households are grappling with economic challenges exacerbated by insufficient rainfall in the early monsoon season and a fragile rural recovery. The scheme's role in providing a safety net and generating employment opportunities is crucial in supporting these households and promoting overall rural development.
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