States struggling to pay workers under a national employment guarantee scheme have received additional funds from the Centre to meet their pending liabilities, but the money is unlikely to be sufficient for the rest of the financial year. They may have to use their own funds to meet unpaid wages for the next two months, says the Centre.

The financial statement of the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) scheme shows that as on January 30, 19 States and Union Territories were in the red, with liabilities ranging as high as ₹1,605 crore in Andhra Pradesh and ₹1,342 crore in West Bengal. Nationally, the scheme shows a negative net balance of ₹4,101 crore.

The Rural Development Ministry received a supplementary additional allocation of ₹6,084 crore this week, as promised earlier this month. “On Monday, we approved disbursement to States based on their liabilities,” said a senior Ministry official, although this is yet to reflect on the financial statement.

Having paid off liabilities, the scheme will now be left with less than ₹2,000 crore for the next two months. “The Ministry has requested another additional allocation of ₹5,000 crore,” said the official.

In case the additional funding does not come through, States will have to use their own resources to pay workers.

“We have authorised States which are willing to put in their own money to go ahead,” said the official. “Centre will pay them back in the first week of April. We want to ensure that labourers get paid on time.”

West Bengal, Madhya Pradesh and Karnataka are among the States that are likely to use their own funds to pay workers, said the official.

The fund crunch has already resulted in extensive wage payment delays. MGNREGA data shows that 81% of Fund Transfer Orders (FTOs) generated in January 2019 and 43% of FTOs from December 2018 still remain unprocessed by the Centre. Currently, MGNREGA workers are only paid compensation for late payment of wages caused by delays in the generation of FTOs by the States, not delays in processing of wages by the Centre.