Fund Crunch Hits MGNREGA In MP, Districts Await Money As Pending Wage Dues Touch ₹1,661 Crore

Bhopal (Madhya Pradesh): A severe fund crunch under the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) has left districts across Madhya Pradesh struggling to clear wage payments.

Official documents submitted by the Panchayat and Rural Development Department in response to a question in the Assembly reveal that pending wage payments under the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) had reached Rs 1,661.04 crore as of June 1, 2026.

The state repeatedly approached the Union Ministry of Rural Development in April and June this year seeking additional funds to clear outstanding liabilities and continue implementation of the scheme.

Letters sent by the Madhya Pradesh State Employment Guarantee Council to the Centre reveal that on April 2, the state informed the Union government that Rs 800.20 crore in wage payments, Rs 1,324.69 crore in material payments and Rs 103.32 crore in administrative expenses were pending. Just 11 days later, in a revised communication dated April 13, the state reported Rs 776.54 crore in pending wages, Rs 1,455.07 crore in material payments and Rs 137.28 crore in administrative liabilities, while requesting release of the first instalment for 2026-27.

The Centre released only Rs 10.03 crore on June 10 as the second instalment of the first tranche towards wage payments for MP. The sanction order notes that the amount would be released through the Direct Benefit Transfer (DBT) system and that further instalments would be released based on utilisation and financial reporting.

District-wise pending payments as of June 1

Khandwa - Rs 1,135.35

Agar Malwa - Rs 686.73

Alirajpur - Rs 348.43

Bhind - Rs 53.00

Bhopal - Rs 165.08

Gwalior - Rs 223.67

Indore - Rs 366.59

Jabalpur - Rs 135.42

Mandsaur - Rs 84.01

Morena - Rs 2,176.07

Narsinghpur - Rs 136.09

Neemuch - Rs 126.33

Niwari - Rs 171.52

Raisen - Rs 112.47

Ratlam - Rs 230.48

Sagar - Rs 481.50

Sehore - Rs 368.59

Shajapur - Rs 98.43

Singrauli - Rs 127.22

Ujjain - Rs 720.23

Vidisha - Rs 6,440.39

MGNREGA payments cover more than wages

MGNREGA does not only pay labourers' wages. It also pays for construction materials (cement, bricks, pipes, gravel etc.) and administrative expenses (staff, monitoring and implementation).

Although the Centre continued releasing funds for wages, assistance for material works and administration reduced significantly, making it difficult to pay suppliers and execute projects.

Officials said wages are required to be paid within 15 days, but did not specify when the pending dues would be be cleared. They added that wage and material payments are a continuous process and depend on the availability of funds released by the Central Government.