Decoding a development aspect, MGNREGS

Partha Roy

The Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) is a social security scheme that attempts to provide employment and livelihood to rural labourers in the country. In an effort to make inclusive and overall development a reality, the scheme was passed as a Labour Law and implemented across 200 districts in 2006. By 2008, it came to cover the entire country. It’s a guarantee to provide paid work opportunities for a predictable duration at a predetermined wage for public works.
Apart from the mandatory provision of resources required for MGNREGS, its success in enhancing the ‘livelihood security’ of rural households would critically depend on the effective implementation of the scheme. The scheme has generated more rural employment than any other government scheme or private initiative in the history of independent India. At the same time, it has spawned a great deal of controversy over its merits and demerits also.
Criticizing the UPA introduced scheme the Modi government branded it a “monument to 60 years of failure.” Its critics have called it wasteful, ineffective, leaky, and argued that it hurts the poor by fuelling inflation. They claim that the assets created by MGNREGS works are of poor quality, as it focuses primarily on wage-supported job creation. They also have pointed out kachcha works like water conservation, afforestation, irrigation, rural connectivity etc. all are non-durable and hence expenditure on it is drainage of public resources and thus providing income security to the poor households could be achieved more efficiently through cash transfer in their accounts. According to them the money would be better spent on skill-development to encourage economic growth and policy to be made to pave the way for private investment in alleviating rural poverty.
The number of households that received the legally guaranteed 100 days of work fell from 51.73 lakhs in 2012-13 to 46.73 lakh in 2013-14 (under the UPA), and then dipped sharply to 23.24 lakh in 2014-15 (under the NDA). One explanation for this could be that funds are not being released by the Centre.
If we look at the data on amount sanctioned, it shows a similar steep decline under the NDA government, from Rs. 27,484 crore in 2013-14 to Rs 17,074 crores in 2014-15.
India spends an estimated 4.2 percent of GDP on subsidies for food, fertiliser, electricity, oil, water, rail services etc., as documented in the Economic Survey. Much of these subsidies do not reach the intended beneficiaries. Targeting is imperfect. An untargeted Universal Basic Income (UBI) framework can make it possible to reduce or eliminate price distortions, and have a better efficacy of the income subsidy, claims the Modi government. Interestingly the government here is not taking lesson from the result of the previously launched Jan Dhan Yojana (JDY). During note-ban a potential number of Jan Dhan accounts were being used in a corrupted way and that also had cost the public resources.
A secure, productive and well-paying job is what most people in the labour force want. That cannot be guaranteed in general, not even in India’s rural areas, as the limited success of NREGS tells us. Jobs are needed for income security and poverty alleviation. Since only 10 percent of India’s labour is in the organised sector, unemployment insurance is not a remedy.
The idea behind UBI is like guaranteeing a dividend to each citizen, for being part of India. It is also supported by right wing economists, as a negative income tax, receivable for everybody with a zero income. It removes the stress and anxiety of workers and households who face irregular monthly incomes. Many countries are already toying with this idea.
Despite the opposition, the Modi government has brought about initiatives and changes to MGNREGS to improve the payment mechanism to tackle the issues pertaining to delayed payment of wages. The Mobile Monitoring System was introduced towards the end of 2014. This system makes way for real-time monitoring of the progress of projects that employ labour under the scheme. This also regulates attendance and work environment in these work sites. At the same time, the states were sanctioned Rs 147 crore by the Centre to strengthen the system of social audit used by the scheme.
Will all the changes the Modi government has made on the existing scheme with an intention to give an asset-intensive tone augur well? It’s hard to say. In country like India where average educational index is miserably low, the government initiatives on the development for poor class may miss the chance. Without proper education and understanding development can never happen. Government’s initiatives and policies can’t work until and unless it’s being received properly. So intended beneficiaries must learn the right process of being benefitted. Here the importance of cohesive participation comes and then the job creation will be the best asset creation and vice versa. Rather than criticizing each other whoever in the power should come forward with a comprehensive education policy, that’s very important. Right education policy only could make the downtrodden fit to get what they are craving for, otherwise the government in the power will always remain a giver and another 70 years will not be sufficient enough. An enlightened mind, a genuine outcome of education, certainly could make the class free from the bondage of ‘subsidy’ and the best demographic dividend for the nation - and the algebra of ‘MGNREGS & UBI’ will be solved sustainably.

Tuesday, 29 August, 2017