Government Position
- The Centre is unlikely to raise daily NREGS wages significantly beyond the usual annual 2–7% hike.
- Reason: Fear that a sharp increase could fuel inflation and complicate fiscal and monetary management, especially with moderating price pressures.
Current Wage Scenario
- Post FY26 hike, most states still offer below ₹300/day under NREGS.
- Only Haryana pays ₹400/day, meeting the panel’s recommended level.
- NREGS wages act as a benchmark for rural and industrial wages, impacting farm costs and overall production economics.
Parliamentary Panel Recommendations
- The Parliamentary Standing Committee on Rural Development, led by Saptagiri Sankar Ulaka, recommended:
- Raising NREGS wage to at least ₹400/day
- Increasing annual workdays from 100 to 150
- Centre is not inclined to accept these recommendations in full.
Effectiveness Under Scrutiny
- Government may instead focus on reviewing the scheme’s implementation:
- National survey recommended by the House panel
- NITI Aayog is currently evaluating NREGS for performance and impact
Sinha Panel (2023) Recommendations
- Headed by Amarjeet Sinha, the expert committee advised:
- Substantial wage increase
- Enhanced budgetary allocation
- The government has not implemented these recommendations yet.
Budget Outlook
- Budget for NREGS in FY26: ₹86,000 crore, same as FY25, indicating no major expansion planned.
Rural Consumption Implications
- Experts note that higher wages could boost rural demand, but this must be balanced against inflationary risks.
TET
