As MGNREGS remains a vital safety net for vulnerable households, the state has decided to commission a study to uncover the reasons behind this alarming trend and present its findings to the Union Ministry of Rural Development.
Published Feb 15, 2025 | 9:00 AM ⚊ Updated Mar 02, 2025 | 7:34 PM
A group of MGNREGS workers in Kerala. (Facebook)
Synopsis: The Mahatma Gandhi National Rural Employment Guarantee Scheme in Kerala is witnessing a sharp decline in its workforce. Workers and local authorities cite a mix of impractical norms, delayed wage payments, stringent audits, and unattractive wages as key reasons behind the alarming dropout rate. Considering Kerala’s unique geographical, socioeconomic, and demographic characteristics, the state government has requested the Union government to allow flexibility in implementation, but without success.
Kerala, once a frontrunner in implementing the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS), is now grappling with an unprecedented crisis — a sharp decline in its workforce.
It is estimated that over one lakh workers, mostly women, have dropped out of the programme, raising concerns about the future of this crucial rural lifeline.
As MGNREGS remains a vital safety net for vulnerable households, the state has decided to commission a study to uncover the reasons behind this alarming trend and present its findings to the Union Ministry of Rural Development.
The focus will be on, What’s causing this mass exodus, and what does it mean for the state’s rural employment landscape?
MGNREGS workers.
Workers and local authorities cite a mix of impractical norms, delayed wage payments, stringent audits, and unattractive wages as key reasons behind the alarming dropout rate.
Though the authorities cite that the dropout is a national phenomenon, the situation is particularly dire in Kerala, where most MGNREGS workers belong to the 60-80 age group.
With new entrants showing little interest, local bodies fear the scheme’s effectiveness is diminishing.
One major issue causing distress among workers is the NREGA Mobile Monitoring Service app, which mandates real-time attendance marking with geotagged photographs — both in the morning and evening.
However, Kerala’s unique landholding pattern makes this requirement impractical.
“Here, land holdings are small, and different works across 10 to 15 plots are often pooled together and marked as a single work. However, the central rule says that workers must return to the same spot where they marked attendance in the morning. For elderly workers, walking back to the starting point after a long day is impossible,” a local MGNREGS coordinator from a grama panchayat in central Kerala told South First.
The Union government’s additional restriction that each grama panchayat can only have 50 works at a time further complicates things. Local officials argue that such rigid stipulations ignore Kerala’s unique work distribution and land-use patterns.
Another reason for the declining participation is wages that remain unattractive.
Currently, the daily wage under MGNREGS in Kerala is ₹346, after an increase of ₹13 in the last financial year. Workers point out that this is significantly lower than wages in other casual labour sectors.
Gomathi, a 67-year-old MGNREGS worker in Thiruvananthapuram, is considering dropping out of the programme.
“In the past, people joined MGNREGS because it guaranteed work. But now, youngsters find the wages too low. Who will work for ₹346 a day when construction and other daily-wage jobs offer much more?” she asked South First.
New job cards are also not being issued, further affecting participation.
A state official noted that the Aadhaar-based worker verification system eliminated duplicate entries, which was necessary, but it also reduced the total number of active workers.
While social audits and ombudsman interventions ensure transparency, many workers feel they have become excessively rigid.
“For example, if the project sanctioned 100 rainwater harvesting pits, but 50 pits were enough to recharge the water table, the audit team still demands all 100 pits be completed. If not, workers are asked to dig the remaining ones without wages,” a grama panchayat member in Palakkad district told South First.
MGNREGS workers.
Such strict compliance measures, which fail to consider practical realities, have made workers wary of participating due to the fear of being held liable for unmet targets.
The Kerala government has also accused the Union government of deliberately restricting the scope of the scheme in the state.
Recently, Local Self-Governments Minister MB Rajesh didn’t hold back in the Assembly. He accused the Union government of deliberately sabotaging MGNREGS by imposing impractical and restrictive guidelines.
He claimed that these measures were designed to shrink the scheme’s scope, making it harder for Kerala to sustain its success.
“Kerala is not just a participant; we are a top performer. If you look at nine key parameters, we lead in four and rank second in the remaining five. Yet, instead of supporting us, the Union government seems intent on torpedoing the program,” Rajesh asserted, highlighting the state’s efficiency in implementing the scheme.
According to him, the Union government is delaying fund allocations, which disrupts wage disbursement and discourages participation.
“They know that if wages are delayed, workers will lose interest,” he said.
The state also sought approval for new works under MGNREGS to suit Kerala’s context, but the proposal remains pending with the Union Ministry of Rural Development.
With elderly workers dropping out and no new entrants, the future of MGNREGS in Kerala looks uncertain unless the Union government revisits its policies.
The state has now launched a social audit to analyse dropout patterns and suggest reforms.
“The findings will help present a fact-based case before the concerned authorities,” said MGNREGS Kerala Mission Director Nizamudeen A IAS told South First.
However, workers like Gomathi remain sceptical. “We don’t need studies; we need practical rules, timely wages, and reasonable wages. Otherwise, this scheme will die,” she said.
As Kerala remains one of the top-performing states in MGNREGS implementation, the fallout raises critical concerns about the future of rural employment in the state and the need for policy adjustments to address worker grievances.
The latest data on employment under MGNREGS in the state paints a telling picture of workforce participation and shifting trends in rural employment. Despite 39.69 lakh job cards issued and 58.49 lakh registered workers, only 20.86 lakh job cards remain active, signaling a significant drop in engagement. This decline is further reflected in the approved labour budget, which has seen a sharp fall from ₹1,050 lakh in 2023-24 to just ₹600 lakh in 2024-25, hinting at reduced work opportunities.
MGNREGA data – Kerala
Interestingly, while youth participation remains low — only 13,042 out of 83,954 registered workers (18-30 years) found employment — the highest engagement is among the 61-80 age group, where 5.05 lakh workers are actively employed.
This shift raises concerns about the lack of sustainable job opportunities for younger generations.
In the current financial year, 57.07 lakh workers have registered, but 2.12 lakh job cards were deleted, while only 1.36 lakh were added, suggesting a net decline in participation.
Among the total 57.07 lakh registered workers, 37.47 lakh are women, yet only 19.52 lakh women are active workers, emphasising a steep drop in female workforce engagement.
These figures collectively indicate a shrinking employment base, declining budget allocations, and an ageing workforce, underlining the urgent need for policy interventions to revive rural job opportunities and make the scheme more inclusive for the younger generation.
At the same time, following the Union Budget 2025, the Ministry of Rural Development reaffirmed its commitment to ensuring sufficient funds for the MGNREGS to meet the demand for work.
It stated that a record ₹86,000 crore has been allocated at the Budget Estimate (BE) stage for 2024-25, the highest ever since the scheme’s inception.
As per the MGNREGS mandate, beneficiaries must receive wage payments within 15 days of the closure of the muster roll, and the Union government has issued a Standard Operating Procedure (SOP) to facilitate timely payments.
Efforts to streamline wage disbursement include expanding the National Electronic Fund Management System (Ne-FMS), ongoing consultations with states, and regular reviews during key meetings.
Despite these measures, as of 27 January 2025, Kerala has pending wage liabilities amounting to ₹485.99 crore.
MGNREGS workers
Officials said that MGNREGS is implemented in India based on the provisions of the Mahatma Gandhi National Rural Employment Guarantee Act, 2005.
As a centrally sponsored scheme, states do not have the authority to amend its norms.
However, considering Kerala’s unique geographical, socioeconomic, and demographic characteristics, the state government has requested the Union government to allow flexibility in implementation, at least for 10 percent of the total expenditure.
Additionally, Kerala has submitted proposals to include new types of work under the scheme and increase workers’ wages, but no positive decision has been taken so far.
Under MGNREGS, unskilled wages and administrative expenses are fully funded by the Union government, while the material fund for asset development is shared in a 75:25 ratio between the Centre and the state.
However, in the financial year 2023-24, Kerala has not received its share from the Union government for administrative expenses and material funds, even though the state has fully allocated its share.
Currently, 266 types of works are permitted under the scheme, as per its implementation guidelines.
Despite repeated requests to update the work list to suit Kerala’s needs, the Union Ministry of Rural Development has not granted approval yet.
MGNREGS is grappling with serious issues at the national level as well as at the state level.
A 2022 Parliamentary Standing Committee report highlighted issues including fake job cards, widespread corruption, delays in muster roll uploads, and significant pending payments for wages and materials.
It stated that genuine labourers struggle to receive their rightful dues, and funds often get misappropriated due to collusion at the ground level. It also pointed to instances where labourers were absent from worksites, yet their names remained on records, ensuring full payments on paper.
In contrast, the Kerala government has intensified efforts to curb irregularities through Social Audits, Ombudsman inquiries, and Vigilance investigations.
Cases of financial mismanagement — such as the use of substandard materials, fake bills, siphoning off wages by peoples’ representatives and inflated procurement costs — have been identified, leading to timely recoveries, including ₹2,82,194 in the current financial year alone.
Clear guidelines have been issued to ensure transparency, and the Vigil App has been introduced to monitor project progress from initiation to completion.
The authorities concerned stated that with an increasing number of asset-creation projects under MGNREGS, additional oversight has been mandated.
Assistant Engineers from the Local Self-Government Engineering Department now supervise material-based works, while periodic inspections by other officials have been tightened. A strengthened social audit system ensures evaluations every six months to maintain efficiency and accountability.
Kerala, once a model state for MGNREGS implementation, is now facing an alarming decline in participation and the scheme’s future in Kerala appears uncertain. The state’s call for policy flexibility, wage revisions, and work modifications remains unanswered.
Unless urgent interventions address worker grievances, streamline payments and adapt the scheme to Kerala’s realities, MGNREGA’s role as a lifeline for rural employment may continue to erode, leaving thousands vulnerable and neglecting the state’s rural labour landscape.
(Edited by Muhammed Fazil.)
