Poverty & Inequality

MNREGA: Technology vs. technocracy

  • Blog Post Date 17 March, 2016
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Reetika Khera

Indian Institute of Technology Delhi


In this article, Reetika Khera, Associate Professor of Economics at IIT Delhi, argues that for MNREGA to flourish in the future, technologies that empower workers should be encouraged, and the tendency to over-centralise the implementation of the programme should be reversed.

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MNREGA has received a hostile reception from the current political dispensation. From the Rajasthan Chief Minister questioning the need for a law, the then Rural Development Minister’s suggestion to limit MNREGA to a few districts, and the Prime Minister’s speech in Parliament in 2015, reveal the Bharatiya Janata Party’s (BJP) hostility as well as their double standards on social policy. In 2005, MNREGA was passed unanimously.

Yet, it would be wrong to lay the entire blame on this government. The perceived ‘success’ of MNREGA in United Progressive Alliance - I (UPA) became a burden under UPA-II. Instead of consolidating on the basics (work on demand, timely payments, better assets, participatory planning), other objectives were foisted on MNREGA - convergence, sanitation, self-help groups, unionising labour and lame attempts at political mileage by mandating construction of ‘Rajiv Gandhi bhawans1.

Technology-friendly to technocracy-servient

From the start in 2005, MNREGA embraced technology. NREGASoft, a management information system (MIS), was specially designed. It has its flaws but greatly facilitated implementation and brought unprecedented transparency to the programme. Similarly, around 2008-09, it was ordered that MNREGA wages be paid only through bank and post office accounts (instead of cash in hand) to curb corruption.

Come UPA-II, MNREGA went from being technology-friendly to being technocracy-servient. The corruption discourse was so dominant that before the impact of wage payment through bank accounts could be evaluated, electronic muster rolls (EMRs) – attendance sheets - were introduced. As it happens, according to estimates by Clement Imbert, wage corruption did go down between 2007-08 and 2011-12 – from 44-58% to 22-32% (cited in Drèze 2014).

EMRs meant that the names of those who applied for work were to be entered in NREGAsoft, to generate EMRs with pre-printed names. The rationale for EMRs was that when labourers demanded work, they could have a dated receipt as proof to claim their unemployment allowance (as per the Act, if work is not provided within 15 days). Further, EMRs were meant to check corruption.It was felt that with paper MRs, names of workers who never came to the worksite (‘fake names’) were being entered and EMRs could put an end to this malpractice.

In practice, EMRs have solved neither of the two problems. In many areas, work is provided to those who show up at the worksite; their attendance is maintained in a ‘kachha’2 register. This register is used to generate post-dated work demand and EMRs. The tear-off receipt in the work demand form remains with MNREGA functionaries. As far as ‘fake names’ are concerned, EMRs allow that sort of corruption to continue. Fake labourers can bully or collude with MNREGA functionaries to register them.

In a nutshell, except in small pockets, EMRs have been damaging: they have undermined the right to demand work at the worksite, added extra layers of paperwork (the ‘kachha’ records and the work demand forms), and in some placesbrought back middlemen (because workers don’t know where and how to apply).


The technocratic approach has been accompanied by over-centralisation. In a short period, the Ministry of Rural Development issued over 1,000 circularsrelated to the MIS. Instead of each state having an MNREGA fund to allocate, the Electronic Fund Management System (eFMS) has centralised flow of funds. In West Bengal, an exasperated Block Development Officer(BDO) told us that it took him eighthours to process one payment through theeFMS.State funds are up (in the ‘cloud’) for grabs on a first-come-first-serve basis. As soon as MNREGA staff hear that funds are available, they all start processing pending payments. Those with better internet connectivity (and luck!), manage successfully, those in remoter areas are left hanging. The trauma was similar to that of booking a tatkal railway ticket3 on the Indian railways website, where after one has made the payment, the transaction can still fail at the last step.

Worse, before one set of changes could take root, another change would be brought in. One official said “before we had read the previous one, a new circular would arrive.” For instance, before eFMS related issues were resolved, Public Fund Management System (PFMS) has been introduced (in Karnataka, 38,000 payments are crippled due to PMFS). MNREGA functionaries have yet to learn what “PMFS” stands for and “Ne-FMS” is in the wings.

Aadhaar collateral

The alleged benefits of Aadhaar4 and of biometric authentication at the time of withdrawing MNREGA wages have long been debunked. With wages being paid into bank accounts, wage corruption is only possible by coercing or colluding with labourers. Coercion means that once the labourer has withdrawn her wages, money is forcefully taken away. Collusion means that the labourer himself becomes party to corrupt practices (that is, fake labourers who are on MRs, but never work). Coercion and collusion can both continue even with biometric authentication. Biometric authentication combined with banking correspondents were supposed to decongest banks, but those pilots failed or never took off.

Since 2013, the Supreme Court has ordered several times that Aadhaar is not compulsory. The Ministry has repeatedly attempted to evade these orders. One-line clarifications (that Aadhaar is not compulsory), are accompanied with half-page instructions on how to seed Aadhaar into NREGAsoft. NREGAsoft was reworked so that work demand could only be registered if it was accompanied by the Aadhaar number.An exemption feature exists, but is not understood by field staff. More recently, written circulars have been replaced by verbal pressure (for example, through video conferences) to achieve Aadhaar-integration. The message is clear – no Aadhaar, no work.

The pressure to ensure Aadhaar-integration has been so immense that in some states field staff deleted job cards when the Aadhaar number was unavailable.In Chitradurga (Karnataka), Rs. 100-150 million wages from 2014-15 are were held up for a year. When payments were being processed, their job cards could not be traced in NREGAsoft. Upon enquiry, the district administration learnt field staff had deleted them to achieve ‘100% Aadhaar-seeding’. Similar instances have been reported in Jharkhand too (Aggarwal 2015).

The Tamil Nadu ‘model’

The only hope for MNREGA comes from Tamil Nadu (TN). Technology has been put to good use,MNREGA administrators have remained firm masters. In TN, MNREGA labourers have remained at the centre of administrator’s efforts. In fact, TN outperforms the two states that are often considered the ‘poster boys’ for MNREGA: Rajasthan and Andhra Pradesh (AP). In 2014-15, each job cardholder in TN got 32 days of work on average, almost twice as high as Rajasthan and AP (their average was 17 days). Women’s share in total employment was 85%in TN, and only 68%and 59% in Rajasthan and AP respectively. On controlling corruption too, TN has done very well. In 2011-12, there was a near perfect match (995) between self-reported workdays in the National Sample Survey (NSS) and official records for TN. In AP and Rajasthan the match was 78% and 69% respectively (Imbert and Papp

In earlier writing on TN, we had noted that the quality of works could be improved considerably in the state (Khera and Muthiah 2010). It appears that some progress has been made on that front too. A remarkable experiment with solid waste management is underway. In 2,000 peri-urban Gram Panchayats, MNREGA labour is used to collect segregated garbage from homes in tricycle carts brought to a yard where biodegradable waste is composted. Non-degradable waste is either sold (for example, glass bottles, rubber, etc.) or in the case of plastic, the Gram Panchayat sells it to a self-help group at Re. 1/kg, which shreds it for resale at Rs. 30/kg to road contractors who use it in road laying. In Pudukottai district, massive tree planation work has been undertaken. In Tiruvallur district, it is widely believed that clearing bushes and grass in existing channels ensured better drainage during the recent flood, as a result of which fewer bunds (embankments) were breached.

TN has successfully resisted Delhi’s attempts at overcentralised technocratic control. In 2008-09, when the Ministry wanted the transition to bank payments within a year, TN ignored Delhi’s deadlines. Ensuring low corruption in others ways, the transition was completed in about five years. Similarly, the state does not use EMRs at all,is able to ensure timely employment, and wages are mostly paid within seven days. The worker-centric efforts in Tamil

Nadu provide the greatest hope for MNREGA’s future.

Bring back focus on labourers

If MNREGA is to flourish in the future, the focus on labourers needs to be brought back. Rather than mindless technical fixes, those technologies which empower labourers should be encouraged (example, decluttering the NREGASoft website, enhancing its multilingual features, etc.). Finally, the tendency to over-centralise implementation of the programme (example, where Delhi issues guidelines to build toilets through MNREGA) needs to be reversed.

A version of this article first appeared on NDTV: http://www.ndtv.com/opinion/for-nrega-tamil-nadu-is-the-only-hope-1272338


  1. ‘Convergence’ refers to different departments (for example, fisheries, forest, etc.) using MNREGA labour budgets for their activities. MNREGA workers have been organised into groups in Andhra Pradesh and elsewhere to form labour groups or self-help groups. ‘Rajiv Gandhi bhawans’ are buildings built with MNREGA funds for use as Gram Panchayat offices.
  2. Kachha’means ‘rough’ in Hindi.
  3. Tatkal railway tickets are meant for short-notice or immediate travel plans.
  4. Aadhaar is a 12-digit individual identification number issued by the Unique Identification Authority of India (UIDAI) on behalf of the Government of India. It serves as a proof of identity and address across the country.

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