Government may increase MGNREGA spend if need arises: Anurag Thakur

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New Delhi: The government would not hesitate to increase the spend under the Mahatma Gandhi National Rural Employment Guarantee (MGNREGA) Programme if the need arises in the future, Minister of State for Finance Anurag Singh Thakur has said.

The minister emphasised that the Modi government has taken steps in the past in the interest of the poor and vulnerable rural population.

Taking on the criticism by the Congress on the lowering of the MGNREGA expenditure in the Budget for 2021-22, the minister said this government has been increasing expenditure unlike them who would cut at the Revised Estimate stage.

Giving an example, he said that against the Budget Estimate of Rs 60,000 crore in 2019-20, the spending was raised to Rs 71,001.81 crore under the MGNREGA head as there was an increase in demand.

In the current fiscal, it has been raised massively from Rs 61,500 crore to Rs 1,11,500 crore to create additional jobs in the rural areas for those who had lost employment due to the outbreak of the COVID-19 pandemic, he said.

For 2021-22, the spending has been increased to Rs 73,000 crore as against the Budget Estimate of Rs 61,500 crore for the financial year ending March.

“During the lockdown, most of the workers had gone home. So, it was more important to provide jobs in rural areas. With unlocking taking place, workers are returning back to their work. So the requirements may not be that huge. However, we may increase if there is demand,” he said.

On the higher fiscal deficit number of 9.5% for the current fiscal, Thakur said for this fiscal it may look more but the government has indicated a glide path to bring it down to 4.5% by 2025-26.

“Various economists and experts had suggested increasing government spending to fight COVID-19, to help the poor survive. On the other hand, businesses were helped so that the jobs are protected. As a result, the fiscal deficit may look slightly high,” he said.

He said many parameters indicate that the economy is on the path of strong rebound and the Budget has also projected a nominal GDP growth rate of 14.4% for the next financial year.

“We saved lives, we saved the economy also. A massive contraction of 23.9% in the first quarter which narrowed down to 7.5% in the second quarter. The GST collection has been over Rs 1 lakh crore since October,” he added.