Finance Minister Nirmala Sitharaman on Thursday strongly defended the Centre’s decision to suspend funding for the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) in West Bengal, citing widespread non-compliance with central directives and serious allegations of fund misuse.
During a discussion on the Central Excise (Amendment) Bill, 2025, in the Rajya Sabha, Sitharaman revealed a critical breach: she claimed the West Bengal government had issued 25 lakh fake MGNREGA job cards, resulting in the siphoning off of “crores of government money.”
The Centre’s decision to freeze funds was initially prompted by noted irregularities, including the awarding of contracts on a nomination basis and a general lack of transparency in the scheme’s implementation.
Sitharaman stressed the Centre’s commitment to ensuring transparency and curbing corruption within MGNREGA. She highlighted that the Ministry of Rural Development had sent repeated communications to the state, based on inspection reports from central teams, demanding rectification of implementation issues.
However, she noted that “no noticeable improvements were observed in the State.”
The move has intensified the ongoing political tussle between the Centre and the state. Trinamool Congress (TMC) members, including Derek O’Brien and Dola Sen, raised vehement objections in the Upper House.
They accused the Centre of withholding essential funds, thereby deepening the distress for lakhs of rural households who depend on the scheme.
TMC members claimed the BJP government has withheld substantial dues, stating, “The BJP government has not paid Rs 2 lakh crore dues which are for the people of West Bengal… We are protesting to demand that the pending amount should be paid.”
The Finance Minister countered the allegations by pointing to a key development: the West Bengal State’s own Action Taken Report (dated 11th July 2025). This report, she said, acknowledged the completion of recoveries totaling Rs 4.81 crore identified by the Central Teams in four districts, along with the status of disciplinary action initiated.
Sitharaman asserted that this report “in itself is an admission of misuse of NREGA funds.” She concluded with a sharp retort to the TMC’s claims of neglect, stating, “West Bengal has never been ignored by this government… In fact, it is the government of Trinamool Congress which is hurting the growth of West Bengal.”