Mahatma Gandhi National Rural Employment Guarantee Act 2005

The Mahatma Gandhi National Rural Employment Guarantee Act was notified on September 7, 2005.The objective of the Act is to enhance livelihood security in rural areas by providing at least 100 days of guaranteed wage employment in a financial year to every household whose adult members volunteer to do unskilled manual work. The key features of the Act are:

• Legal right to work: Unlike earlier employment guarantee schemes, the Act provides a legal right to employment for adult members of rural households. At least one third beneficiaries have to be women. Wages must be paid according to the wages specified for agricultural labourers in the state under the Minimum Wages Act, 1948.
• Time bound guarantee of work and unemployment allowance: Employment must be provided with 15 days of being demanded failing which an ‘unemployment allowance’ must be given.
• Decentralized planning: Gram sabhas must recommend the works that are to be undertaken and at least 50% of the works must be executed by them. Panchayati Raj Institutions are primarily responsible for planning, implementation and monitoring of the works that are undertaken.
• Work site facilities: All work sites should have facilities such as crèches, drinking water and first aid.
• Transparency and accountability: There are provisions for proactive disclosure through wall writings, citizen information boards, Management Information Systems and social audits. Social audits are conducted by gram sabhas to enable the community to monitor the implementation of the scheme.
• Funding: Funding is shared between the center and the states. There are three major items of expenditure – wages (for unskilled, semi-skilled and skilled labour), material and administrative costs. The central government bears 100% of the cost of unskilled labour, 75% of the cost of semi-skilled and skilled labour, 75% of the cost of materials and 6% of the administrative costs.