The decision effectively means that there will be no advance release of funds any longer. The decision effectively means that there will be no advance release of funds any longer.

The government on Wednesday approved the release of wages directly to the accounts of the workers engaged under the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA).

The Cabinet decided that the wage component of MGNREGA will now be released directly to the workers’ account based on a fund transfer order to be generated by the state’s implementing agencies. The Rural Development Ministry will prescribe the procedures for this.

The decision effectively means that there will be no advance release of funds any longer. The fund release will match the expenditure on a daily basis, thus meaning no surplus or deficit. Accordingly, the funds will then flow electronically directly into the worker’s accounts. This will help eliminate delays in wage payments as well as unnecessary parking of funds.

The move essentially is aimed at further streamlining the fund flow system and to empower the state governments or grassroots implementation agencies to deliver entitlements as per the objectives of the Act, government sources said. The system is expected to benefit all stakeholders and improve the overall efficiency of the scheme.

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