Kerala panchayats await ₹500-crore MGNREGS material dues amid shift to VB–G RAM G

Grama panchayats across Kerala are contending with unpaid material costs for works carried out under the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) in the last financial year, with the Union government yet to release the funds.

Office bearers of the Kerala Grama Panchayat Association raised the matter with Local Self Government Department Minister K.M. Shaji earlier this week. They said most panchayats in the State are under pressure, as contractors are demanding settlement of their bills. The material costs owed to panchayats in Kerala are estimated at more than ₹500 crore.

According to K.B. Madan Mohan, CEO of the Grama Panchayat Association, the dues cover an entire year of MGNREGS works. He said the State MGNREGS mission was itself unable to confirm whether the allocation would be made. Funds for works under the Viksit Bharat – Guarantee for Rozgar and Ajeevika Mission (Gramin), or VB–G RAM G, which began this year, have already been disbursed, he added. The association has taken up the issue with the LSG Minister, who is expected to raise it with the Union government.

VB–G RAM G came into force nationwide on July 1, replacing MGNREGS. A steering committee has been constituted to guide implementation of the new programme at the State level.

A key concern flagged in the revamped scheme relates to cost-sharing. Under the new arrangement, the Union government sets a normative allocation, of which 40% is to be borne by the States. Responsibility for all working days beyond that allocation rests entirely with the States. Kerala is estimated to face an additional burden of ₹3,500 crore because of this condition.