New Delhi, Oct. 14 -- The government is reassessing the budget for its flagship rural job guarantee scheme amid worsening distress following widespread floods across Bihar, Uttar Pradesh, Himachal Pradesh and Punjab, two people familiar with the matter told Mint.

The outlay for the scheme under the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) has been unchanged at Rs.86,000 crore for two consecutive fiscal years. The amount may be revised upward as officials examine whether additional funds are needed to meet surging job demand in flood-affected regions where agricultural work has been disrupted.

"Floods have left large stretches of farmland unusable in some states, pushing labourers in some states to seek fallback e...