West Bengal left high and dry after Centre freezes MGNREGS funds for State

The Mamata government is at its wits’ end trying to handle growing discontent among the people.

None of the Sabars of Kultari gram panchayat in West Bengal’s Purulia district has got any work under the MGNREGS this year. The delay in release of wages has brought work to a complete halt in the State.  | Photo Credit: DEBASISH BHADURI

The Centre has withheld funds for several welfare schemes in West Bengal, including the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS), for almost a year now, putting the Trinamool Congress government in an uncomfortable situation ahead of panchayat elections likely early next year. While the State government tries to resolve the impasse, it is desperately looking for avenues to generate income in rural Bengal. With the State exchequer depleted, as per the government’s own admission, and very little investments flowing into the State, the government has its work cut out in quelling the growing discontent at the ground level.

Bengal’s rural economy is overwhelmingly dependent on the MGNREGS, which is mandated to give 100 days of work to rural households. In the 2021-22 fiscal, West Bengal topped the list of States in terms of the number of people (1,11,19,765) employed under the scheme and in terms of man-days generated (36.41 crore) was second only to Rajasthan. However, since December 2021, the State has not received funds for the Central scheme, and as a result the total man-days generated until October 2022 dropped to 3.67 crore.

The Centre’s reason for stopping funds was rampant corruption in the implementation of the scheme. After repeated requests to release funds, the State government was forced to try to generate alternative means of employment at the grassroots level. Following a meeting with district magistrates, Chief Secretary Hari Krishna Dwivedi stated that the government’s “emphasis” was on engaging MGNREGS job cardholders in the schemes of State government departments.

“All departments are requested to engage only unskilled labourers having job cards under Mahatma Gandhi NREGS during execution of their schemes. The field level officers of the departments should be directed to ensure that the implementing agencies comply with this direction,” the Chief Secretary’s circular dated November 3 stated. District magistrates have also been directed to issue job cards to unskilled labourers who do not have them. West Bengal has around 3.42 crore registered workers under the MGNREGS.

The State government’s recent announcement to waive 50 per cent of outstanding electricity bills over a period of time for households and connections used for agricultural work can be seen as an attempt to lessen the hardship brought on by the lack of Central funds for income-generating schemes. The one-time waiver, which includes all surcharges, was also clearly made with the panchayat elections in mind.

The Centre’s decision to freeze MGNREGS funds is seen as a long-term strategy to neutralise Chief Minister Mamata Banerjee’s system of creating beneficiaries. | Photo Credit: PTI

The Centre’s decision to freeze funds is seen as a long-term strategy to neutralise Chief Minister Mamata Banerjee’s system of creating beneficiaries, which is a core component of her politics. The implementation of the MGNREGS through the State administrative machinery has been an important part of her method of creating beneficiaries, and Bengal has always been among the top States in terms of providing employment through the scheme. The system has paid her political dividends even in her most trying moment, as was seen in the 2021 Assembly election when the Bharatiya Janata Party (BJP) presented a stiff challenge to the Trinamool. With the Centre stopping funds, this particular aspect of Mamata Banerjee’s welfare politics is getting severely hampered with every passing day.

‘Misutilisation of funds’

In July, in response to a question in the Rajya Sabha, the Ministry of Rural Development stated that of the Rs.3,989.58 crore the Centre owed to States for the MGNREGS, Bengal alone accounted for Rs.2,605.82 crore. A month later, the Ministry, replying to a question by Trinamool Rajya Sabha member Jawhar Sircar, said West Bengal was the only State that had not received any funds for 100 Days Work. The reason cited was “non-compliance of directives of the Central government”.

In her most recent letter to Prime Minister Narendra Modi on this issue, on August 5, Mamata Banerjee said: “MGNREGA is a major wage-earning support of the economically weaker sections in the rural areas. Awas Yojana and Gramin Sadak Yojana are significant schemes on providing housing to the houseless and enhancing rural connectivity. Fund due from the Central government on these schemes now is about Rs.17,996.32 crore. State government is complying with all the directions of the Central government. However, funds have not been released, thus creating a huge blockade to implementation of the schemes and putting the rural people in great distress.”

Leader of Opposition in West Bengal Legislative Assembly and BJP leader Suvendu Adhikari. | Photo Credit: PTI

In fact, on August 6, the Leader of the Opposition in the Bengal Assembly, Suvendu Adhikari of the BJP, wrote to the Prime Minister highlighting the government’s alleged misuse of Central funds. He claimed that “novel kinds of means and ways” had been adopted in Bengal to “swindle money” granted through Central schemes. “MGNREGA has become the primary source of employment. So it must be ensured that the amount granted must reach the last mile beneficiary who sheds blood and sweat to earn his employment, not to be gulped down by the corrupt people who run the panchayats,” the letter stated.

The socio-legal researcher and RTI activist Biswanath Goswami said the Comptroller and Auditor General had not done any audit or inspection on the MGNREGS in West Bengal after 2011-12. “MGNREGA has always been a tool of narrow politics between the funding and the implementing agencies in West Bengal for a long time, and there have been repeated instances of fund mismanagement and fund manipulation by the State,” Goswami told Frontline.

According to the psephologist Biswanath Chakraborty, the freezing of Central funds will hurt the Trinamool grassroots workers and leaders particularly hard. “These panchayat level leaders and workers have been big beneficiaries of the siphoning of funds within the system. We have seen that with the money flow drying up, the rural cadres of Trinamool are also becoming disheartened and losing enthusiasm for work. If this continues, it will have an impact in the panchayat elections,” Chakraborty said.

As of now, Mamata has ordered the district administration to clamp down on corruption at the panchayat level, and the normally outspoken Mamata has been restrained in her criticism of the top BJP leadership, including the Prime Minister, and even the RSS. After the Morbi bridge collapse tragedy, when pressed by journalists to comment, she said: “I will not say anything against the Prime Minister.”

For one who has made no secret of her political ambitions at the Centre and has been one of the most vocal critics of Modi, Mamata’s sudden change of tone is seen as a “conciliatory gesture” at a time when her government has its back to the wall owing to ongoing investigations on several scams, including the School Service Commission recruitment scam.

Victimising the poor

Significantly, the BJP’s decision to freeze funds comes at a time when, following its defeat in the 2021 Assembly election, it has rapidly lost whatever ground it gained after the 2019 Lok Sabha election by winning 18 of the 42 seats in the State. Not only did the saffron party fare miserably in subsequent byelections and civic body elections, it also lost a section of its leaders and workers, many of whom returned to the Trinamool fold after jumping ship just ahead of the Assembly election.

Many people feel that ultimately it is the poor who are caught in the midst of a Centre-State feud. “Whatever be the politics, this is victimising the poor,” said the political observer and academic Surajit C. Mukhopadhyay. “It is politically expedient to call the Centre’s fund-freeze a move against corruption… but what it essentially intends to do is to put the State government on the mat ahead of the panchayat elections. But as a result, the poor are suffering even more. Both the Centre and the State are equally at fault here.”

The Crux

• The Centre has withheld funds for several welfare schemes in West Bengal, including the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS), for almost a year now.
• The reason cited is rampant corruption in the implementation of the scheme.
• It is seen as a long-term strategy to neutralise Chief Minister Mamata Banerjee’s system of creating beneficiaries, which is a core component of her politics.
• The State government is trying to generate alternative means of employment at the grassroots level.