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Data: Budget allocation for MNREGA, NSAP & PM-KISAN reduced in 2022-23 after record allocation during COVID-19

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Under the direct financial support schemes of the union government to the marginalized sections, the NSAP & PM-KISAN stand out. After record expenditure in 2020-21 on account of the pandemic, the budget allocation in 2022-23 was reduced to be more in line with pre-pandemic years. Even the allocation for MNREGA are reduced despite record spending in 2020-21 & 2021-22. 

Expenditure incurred towards the implementation of the various schemes forms a major component of the overall budget expenditure of the Union Government. In every budget, the government estimates the expenditure for specific schemes for the financial year and makes allocations accordingly. Various factors could impact the implementation of the scheme and the actual expenditure incurred could sometimes be way off the budget estimates.  

The outbreak of the COVID-19 pandemic in 2020 meant that the government had to provide support & relief to the people and the sectors affected by the pandemic. The Pradhan Mantri Garib Kalyan Package (PMGKP), Aatma Nirbhar Bharath Package, etc. were among the key COVID-19 relief and support measures announced by the Government of India. 

The onset of the pandemic in India was after the 2020-21 budget was presented. Hence the expenditure towards the relief measures resulted in the actual expenditure for 2020-21 being way beyond the budget estimates for major schemes.  

As part of the budget for  2022-23, the details of the actual expenditure incurred for the various schemes in 2020-21 were provided. The information on revised estimates for 2021-22, when the country has been hit by a severe second wave of COVID-19 was also provided in the budget. The government had to continue certain relief measures because of the ongoing pandemic while the other relief measures were more of a one-time initiative, the expenditure for which was accounted in 2020-21. 

In this story, we look at the pre- & post-pandemic trend in estimated & expenditure for a few of the major central schemes that would help us understand the actual quantum of government spending during the pandemic. In this first part, we look at three specific schemes – MGNREGA, NSAP & PM KISAN, related to livelihood support and direct financial support to marginalized sections of the population during the pandemic. The data used for this story is actual expenditure from 2016-17 to 2020-21 and estimates for 2021-22 and 2022-23. 

55% increase in the actual expenditure towards MGNREGA in 2020-21 compared to 2019-20

The loss of livelihoods during the pandemic and the ensuing return of the migrant workers to their native places resulted in the need for more work in Rural India. We had earlier written about how MGNREGA came to the rescue of Rural Employment during the pandemic. 

During 2020-21, 389.1 crore person-days of work were generated compared to 265.32 crore person-days in 2019-20. This increase in the work provided under MGNREGA is evident in the expenditure for 2020-21.  The actual expenditure under the Scheme for 2020-21 was Rs. 111.17 thousand crores, whereas it was Rs. 71.69 thousand crores in 2019-20. The substantial increase in demand for work under MGNREGA due to the pandemic, was evident from the actual expenditure for 2020-21 as the budget estimate for MNREGA (2020-21) was only Rs. 61.5 thousand crores. In view of the increased demand during the pandemic, the revised Estimate was increased to Rs. 111.5 thousand crores, which was almost equal to the actual expenditure. 

For 2021-22, the Government allocated Rs. 73 cores in the budget estimates for MNREGA. However, in view of the higher work demand even during 2021-22, the revised estimate was increased to Rs. 98 thousand crores. The total person-days of work as on date for 2021-22 around 309 crores. 

In the case of MGNREGA, the actual expenditure has always been more than the initial estimates if one goes by the data from 2016-17. The pandemic has widened this gap further. 

An exponential increase in the expenditure under NSAP during 2020-21 

The National Social Assistance Programme (NSAP) is a Centrally Sponsored Scheme that provides financial assistance to the elderly, widows, and persons with disabilities in the form of pensions. 

For 2020-21, the initial budget estimate of the allocation under the different schemes of NSAP was Rs. 9.19 thousand crores.  However, the government extended direct financial support to the vulnerable sections of the society like the elderly & widows to tide over the financial problems during the lockdown. The revised estimate for 2020-21 was at Rs. 42.61 crores while the actual expenditure in 2020-21 stood at Rs. 42.44 thousand crores under NSAP. 

The more than four-fold increase can be attributed to ‘Direct Bank Transfers’ to Women account holders of ‘Pradhan Mantri Jan Dhan Yojana’ (PMJDY) under PM Garib Kalyan Package in view of the COVID-19 pandemic. Under this initiative, a sum of Rs. 500 per month was transferred to women PMJDY account holders for three months.  As per the government’s latest update, Rs. 30.95 thousand crores were transferred to around 20.65 crores beneficiaries under this one-time initiative. 

This disbursement was specific to the pandemic lockdown period in 2020-21 and was not extended. This is evident from budget estimates for both 2021-22 and 2022-23 which are back to the pre-pandemic levels. The revised estimates for 2021-22 is Rs. 8.73 thousand crores which are in line with the numbers for earlier years. 

No additional support under the PM KISAN scheme during the pandemic 

PM KISAN (Pradhan Mantri Kisan Samman Nidhi) scheme is a flagship Central Sector Scheme, where-in eligible farmers get up to Rs.6000 per annum as direct financial support. The scheme is inspired by similar successful schemes in states like Telangana, Odisha, etc. 

As part of the COVID-19 related Garib Kalyan Package, the government announced an up-front payment of Rs. 2000 to around 8.7 crore farmers. This payment as indicated, was an upfront payment and not an additional amount. There was no additional support extended to the farmers under this scheme. The initial budget allocation to the scheme in 2020-21was Rs. 60.9 thousand crores, higher than the Rs. 48.7 thousand crores in 2019-20.  However, this can be attributed to the gradual increase in the number of eligible farmers who were being brought into the scheme’s fold than any specific COVID-19 related support. 

While the number of beneficiaries under the scheme is expected to increase, the budget allocation does not account for this anticipated increase. The initial budget estimated for 2021-22 was Rs. 65 thousand crores while the revised estimate was increased to Rs. 67.5 thousand crores. The budget estimate for 2022-23 is Rs. 68 thousand crores. The trend since the inception of the scheme has been that the actual expenditure is less than the initial budget estimates.  

Despite MGNREGA & NSAP coming to the rescue, a decrease in the budget allocation 

It is evident from the information available that the financial support under NSAP as well as the provision of work under MGNREGA came to the rescue of the marginalized during the pandemic. However, the budgetary allocation in 2021-22 and 2022-23 does not leverage these schemes to continue to aid the marginalized sections impacted by the pandemic. In 2021-22, the budget allocation under MNREGA was only Rs. 73 thousand crores while the actual expenditure in 2020-21 was Rs. 111.17 thousand crores. The same amount of Rs. 73 thousand crores are allocated as part of budget estimates in 2022-23 as well despite the revised estimates for 2021-22 being Rs. 98 thousand crores. 

In the next story, we look at the budget allocation to other major schemes which provide support to the marginalized sections, especially around food security.  

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