Current Context : For the first half of Financial Year 2025–26, the Ministry of Finance has imposed a 60 percent spending cap on the Mahatma Gandhi National Rural Employment Guarantee Scheme to manage persistent budget overruns and pending wage dues.

About MGNREGS Spending Cap

• Scheme Background
  • Established in 2005, guarantees 100 days of wage employment per rural household per year.
  • Demand‑driven: rural families can register and request work at any time.
• Rationale for Cap
  • Historically, 70 percent+ of the annual budget is spent by September, leading to pending dues of ₹15,000–25,000 crore at year‑end.
  • Cap ensures fund availability in the second half and reduces reliance on ad‑hoc supplementary allocations.
• Financial Details
  • Budget for 2025–26: ₹86,000
  • Release by June 2025: 28 percent (≈₹24,080 crore).
  • Pending dues from 2024–25: ~₹19,200 crore (≈22 percent of current budget).