Despite Spending MGNREGA Works Remained Unfinished in J&K Part-II

(This news article is a three-part series. Part-II is published today. Part-I can be read here.)

SRINAGAR: Jammu and Kashmir spent ₹1,897.10 crore on MGNREGA works that remained incomplete, while nearly three-fourths of all works taken up under the rural employment programme during five years were still unfinished.

A new Comptroller and Auditor General (CAG) report has exposed a striking gap between expenditure recorded and assets delivered.

The audit of the Mahatma Gandhi National Rural Employment Guarantee Scheme also found hundreds of crores of rupees owed to workers, suppliers and others, payments made where basic supporting records could not be found, and government funds held back beyond prescribed deadlines.

Between 2019-20 and 2023-24, Jammu and Kashmir planned 27.14 lakh works under MGNREGA.

Only 20.16 lakh were actually taken up. Of those, merely 5.34 lakh, or 26 per cent, were completed. That left 14.82 lakh works unfinished, representing 74 per cent of everything taken up for execution.

By March 2024, ₹1,897.10 crore had already been spent on these incomplete works. The CAG recorded an especially significant detail: reasons for the failure to complete 74 per cent of the works were not available in departmental records.

On headline employment figures, the programme appeared considerably better. Of 37.82 lakh job-card households demanding employment over the five years, 34.99 lakh, or 93 per cent, received some work. But MGNREGA promises eligible rural households up to 100 days of wage employment.

Only 77,512 households, about two per cent, received 100 days of employment during the five-year period. The audit also found that the Rural Development Department had not conducted the mandated door-to-door survey to determine how much labour was actually required and when.

District Perspective Plans were absent.

The CAG concluded that planning had effectively become input-driven rather than demand-driven, reversing the basic logic of a programme intended to respond to demand for rural employment.

₹704 Cr Waiting to be Paid

By March 2024, the Department had accumulated outstanding liabilities of ₹704.39 crore.

These included ₹49.19 crore in unskilled wages, ₹646.92 crore for skilled and semi-skilled wages and materials, and ₹8.28 crore in administrative expenditure.

The scale of the material backlog was extraordinary.

Against ₹1,333.25 crore spent on materials and skilled or semi-skilled labour during 2019-24, ₹646.92 crore, or 49 per cent, remained unpaid.

Some bills had been pending for between one and five years.

The Department told the CAG in August 2025 that liabilities would be cleared when funds were received from the Union Ministry of Rural Development.

But the unpaid amounts were only one part of the financial-management problem.

The CAG found that the J&K Finance Department delayed transferring ₹2,150.39 crore received from the Centre to the State Employment Guarantee Fund.

The delays ranged from four to 122 days beyond the permissible period.

Under the conditions governing the releases, such delay attracted interest at 12 per cent. The CAG calculated Jammu and Kashmir's resulting interest liability at ₹44.18 crore. It found no correspondence on record showing that a demand for this interest had been raised.

The audit becomes more troubling when it moves from macro figures to individual works. Auditors examined 400 sampled works. For 266 of them, or 67 per cent, Measurement Books were not found in the corresponding work files.

A Measurement Book is not a ceremonial document. It records the quantity of work actually executed and provides the basis on which payment is calculated.

Without the books, the CAG said it could not establish the accuracy and authenticity of the payments.

The Department subsequently assured auditors that future payments would not be processed without certified Measurement Book entries.

There was a similar problem with muster rolls.

In 84 of the 400 sampled works, physical muster rolls for skilled and semi-skilled workers were unavailable, although ₹24.72 lakh had been paid on the basis of entries in the NREGASoft system.

The Department argued that payments could not be made without generating muster rolls because transactions passed through the Public Financial Management System.

The CAG's response was telling: whatever existed electronically, physical muster rolls were neither on record nor produced during the audit or with the government's replies.

Reliance solely on electronic entries without corroborating records, it said, undermined transparency. For all 400 sampled works in 40 Gram Panchayats, auditors also found that the prescribed system under which workers themselves periodically verify bills and vouchers had not been operationalised.

Rejected Wage Payments

The audit identified 316,178 rejected financial transactions during the five years.

Of them, 283,196, or 90 per cent, related to wages of unskilled workers worth ₹48.91 crore.

Dormant bank accounts, changed banks, incorrect IFSC codes, incorrect account details and failure to map Aadhaar numbers were among the reasons.

The significance is difficult to miss. A programme intended to put cash quickly into the hands of rural workers was generating large volumes of payments that failed before reaching their recipients.

The audit separately found non-payment of unemployment allowance and delayed wages and compensation.

MGNREGA funds were also converged with other programmes to create village assets.

In four sampled districts, 144 Anganwadi Centres were sanctioned between 2017 and 2024 at a cost of ₹9.33 crore.

By March 2024, 104 centres, or 72 per cent, remained incomplete. ₹2.42 crore had already been spent on them.

The shortfall in completion ranged from 54 to 100 per cent across the four districts.

The CAG called the ₹2.42 crore expenditure unfruitful, attributing the failure to inadequate inspection and monitoring by district authorities. J&K - Report No. 4 of 2026_CAR …

These findings are significant because MGNREGA till recently was simultaneously an employment programme and a public-asset programme. Its money was supposed to leave behind both wages in rural households and durable assets in villages.

The CAG audit suggests that Jammu and Kashmir frequently achieved neither objective completely.

Workers received some employment, but only two per cent of households demanding work reached 100 days. Contractors and suppliers accumulated unpaid bills. Basic measurement records were missing from sampled files. And ₹1,897 crore had been spent on works that remained incomplete.