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CAG report on NREGA: Fact and fiction

The draft report of the Comptroller and Auditor General on the working of the National Rural Employment Guarantee Act was used by many sections of the media to strongly criticise this employment programme. Much of the coverage sensationalised the findings of the report. What did the CAG actually say? Where did the CAG fall short in its investigations? And what can we learn from the CAG to improve the functioning of the NREGA?