Tatsat Chronicle Magazine

Aadhaar-Based Payment System Is Making Life Hard For MGNREGS Workers

Thousands of the rural poor have been deprived of MGNREGS wages due to problems in linking job cards and bank accounts with Aadhaar details, exposing the limitations of technology
January 29, 2024
Photo; Wiki Commons

As directed by the government, payment of wages under the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) must be done through an Aadhaar-based payment system (ABPS) from January 1, 2024. Under this system, a worker’s Aadhaar number needs to be seeded in their MGNREGS job cards and the bank account into which the payment will be made should be linked to the same Aadhaar number, while the bank must be linked to the National Payments Corporation of India (NPCI), which is the umbrella organisation for routing all digital payments as mandated by the Reserve Bank of India.

The day after ABPS was declared mandatory, Rural Development Minister Giriraj Singh pointed out that several deadlines had been given for completing the linking. “We will penalise states, not workers, if they are not yet linked with ABPS,” he said.

But, even minor typological mistakes in name or date of birth in the Aadhaar card, job card or bank account are resulting in stoppage of wage payments. This is depriving thousands of the rural poor of their only source of livelihood—especially women, who make up a greater proportion of the MGNREGS workforce.

Though ABPS was made mandatory by the Centre from February 1, 2023, the deadline was extended several times—first to April 1, then to July 1, September 1, and finally to December 31. It was done at the request of the states for more time to complete the seeding of job cards with Aadhaar details. The Centre refused to relent despite criticism by worker unions and experts, highlighting the multitude of flaws with the system.

Quoting government sources, The Hindu reported that the decision to not extend the deadline beyond December 31, 2023, was “guided by active workers, rather than job card holders”. Active workers are those who have worked for at least one day over the past three financial years. Until December 27, 2023, the report said, “12.7% of these active workers are still not eligible for ABPS. Of the 25.25 crore registered workers under the flagship rural jobs scheme, 14.35 crore are categorised as active workers”.

The report added, “Anecdotal evidence and ground reports suggest that, facing pressure from the Union government to have 100% ABPS-eligible job cards, states have deleted a number of cards, which were not eligible for Aadhaar payments.” Quoting LibTech India—a collective of academics and activists—it reported that 7.6 crore workers have been deleted from the system over the past 21 months.

In August last year, Bengaluru-based news website The News Minute reported that over 20.8 lakh people in the south Indian states actively working under MGNREGS were “yet to qualify to receive their wages” under ABPS. The reportpointed out that of the nearly 3.57 crore MGNREGS workers active in the southern states, about 3.36 crore were able to complete this process. Around 20.8 lakh workers were unable to do so as of August 17, 2023, and remained ineligible for payment.

“This is despite the five southern states featuring among the top six states with the highest success rate of workers qualifying for ABPS, along with Tripura. Across India, out of over 14.4 crore active workers, 2.89 crore workers were yet to qualify for the new system as of August 17, 2023, according to government data,” said the report. Kerala is the only state where 100% active workers are eligible for ABPS payment.

The Centre’s decision has come in for criticism from the main opposition party, the Congress. “Despite many challenges highlighted by workers, practitioners, and researchers in using ABPS for MGNREGA wage payments, the Modi government has continued with its destructive ‘experiments with technology’. This is the Prime Minister’s cruel New Year gift to exclude crores of the poorest and marginalised Indians from earning a basic income,” alleged Jairam Ramesh, party general secretary in charge of communications, in a statement.

When the Centre made ABPS mandatory from February last year, CITU—a worker union affiliated to the CPI(M)—termed it “one more blow to workers”. It issued a statement in March, saying, “This will create huge problems for workers as presently only 44% of workers are eligible for payment under ABPS. This means 56% of MGNREGA workers will be suffering.”

On August 30, 2023, the Rural Development Ministry itself shared in a statement, “Out of the total 14.33 crore active beneficiaries, Aadhaar has been seeded for 13.97 crore. Against these seeded Aadhaar, a total 13.34 crore Aadhaar have been authenticated and 81.89% of active workers are now eligible for ABPS.  In the Month of July 2023, about 88.51% of the wage payment has been made through ABPS.”

However, the statement also claimed that in consultation with different stakeholders, ABPS was found to be the “best route for making wage payment through Direct Benefit Transfer (DBT)”.

According to information available on the Rural Development Ministry’s MGNREGS portal, as of January 16, 2024, the total number of job cards issued was 14.3 crore, where the number of workers was 25.16 crore, while the total number of Active Job Cards was 9.78 crore against the number of active workers at 14.36 crore. A worker is considered active if he/she has worked under MGNREGS, which guarantees 100 days of work to rural households, for even one day in the past three years.

The ministry has issued a clarification on January 1 this year. “In a working paper released by a Public Research and Advocacy group, LibTech, it has been referred and according to this it is claimed by some of the researchers that there is no significant gain with ABPS vis-à-vis bank account payments and it is just 3% more in case of ABPS. It needs further clarification that keeping the scale of Mahatma Gandhi NREGS in view, this 3% gain is also a very significant gain. This research by LibTech endorsed that ABPS process is resulting in the favour of better implementation leading to a greater transparency,” the statement said.

On “weaponising technology”, the release claimed, “Mahatma Gandhi NREGA is a demand driven scheme and is affected by various economic factors. Total number of registered job cards is 14.32 crore, out of which just 9.77 crore (68.22%) is active job cards. There is a total of 25.25 crore workers, out of which just 14.32 crore (56.83%) are active workers. The use of different technologies ranging from space technology/remote sensing to IT enabled technology, has brought a transformation in the implementation of the scheme.”

Considering that not all citizens have been connected to Aadhaar, the ministry stated that “the Government of India may consider exemption from ABPS on case-to-case basis till the resolution of the issue”. It further added, “…out of the total 14.32 crore active workers, Aadhaar seeding of 14.08 crore (98.31%) active workers has already been completed. Against these seeded Aadhaar, a total 13.76 crore Aadhaar have been authenticated and 87.52% active workers are now eligible for ABPS.”

Even as allegations and counter-allegations are traded, the moot point is whether the money is reaching the poor in rural India for whom MGNREGS is the only source of livelihood, especially at a time when unemployment is soaring in the country.

Jayanta Bhattacharya

Journalist. Curious about astronomy, cinema, communications, digital media, geostrategy, human rights, military, tech, and nature.