MGNREGA may be the worst hit due to budget cuts

The MGNREGA rural job programme and other social welfare schemes will take a significant hit due to the 15 percent budget cut that the ministry of finance is believed to have proposed recently, social activists said Saturday.

"You (the government) cut fund allocations from social and development programmes and then talk of development. That is so wrong. Such notion is misplaced and insulting," said Jayati Ghosh, a professor of economics at Jawaharlal Nehru University .

A cut of Rs.3,000 crore in the current MGNREGA budget is expected to affect about 5,000 daily-wage earners, the activists said at a meeting organized by the Centre for Budget and Governance Accountability.

"I have learnt from my sources that the finance ministry has asked for Rs.3,000 cut. I would love if the government could deny that figure," said Nikhil Dey, a social activist.

The finance ministry announced the budget cut in order to meet the fiscal deficit of 4.5 per cent of the fiscal year of 2013-1014.

Tripura Chief Minister Manik Sarkar's has already demanded more funds for implementing MGNREGA in his state.

Ten other states, including many ruled by the BJP such as Chhattisgarh and Madhya Pradesh, have either passed a resolution in their respective assemblies or have written to the union government requesting for raise in these funds.

While acknowledging the importance of Prime Minister Modi's Smart Cities project and the Ganga Rejuvenation programme, the activists urged the government not to compromise the needs of the social sector in order to meet the targets of its new commitments.

Alternatives like raising taxes could be considered to serve the purpose instead."Pitting the social sector against other sectors is not a solution. Find resources for new commitments like Swachh Bharat Abhiyaan not from existing social programmes like MGNAREGA," proposed Subrat Das of Centre for Budget and Governance Accountability.

The bone of contention are the revised budget estimates of the current fiscal year.The government may propose a 15-percent reduction in funds for the social sector. But the activists contend that this year's budget estimates for the social sector, food security, and rural development were already insufficient as compared to what the UPA government had provided in the financial year of 2013-14.

Hence, there should be no further reduction in the revised budget estimates of 2014-15, they said urging the government to expand the pool of resources instead.

"Allocate resources for new priorities by expanding the size of the budget in proportion with the current GDP. That's possible if you collect more revenue," Das said.

Over a hundred social organizations are converging in Delhi next month to drum up support for their demand to stop budget cuts.